FAIR TRADE What is fair trade and how does it effect small scale farmers Sunday, December 21, 2008

Outline Coffee Facts Coffee in Canada What is Fair Trade? Supply Chain Comparison Where does coffee money go? Coffee Price History Conditions of certification How does Fair Trade Certification Work? Effects of Fair Trade –For the farmer –For the consumer –Case Study

Coffee Facts 2 nd most traded commodity in the world Top 10 coffee producing countries: 1.Brazil (31%) 2.Vietnam (15%) 3.Colombia (11%) 4.Indonesia (5%) 5.Ethiopia (5%) India, Peru, Mexico, Guatemala, Honduras (17% total) 2 Types : –High Quality Mountain grown Arabica –Lower Quality Robusta beans Source: International Coffee Organization, 2007

Source: Canadian Coffee Association (2003,2997) Coffee in Canada 81% of Canadians drink coffee occasionally We consume on average 2.6 cups per day. Canadians consume 31 billion cups of coffee a year on average 18% of total beverage consumption Consumer Awareness: 51% organic 38% Fair Trade

What is Fair Trade? It is a certification that guarantees certain production and trade conditions Fair Trade products sold in Canada (Coffee, Cocoa, Tea, Banana, Cut Flowers, Cotton, Shea Butter, Sugar) “Fair trade is a trading partnership, based on dialogue, transparency and respect, that seeks greater equity in international trade…” (Fair Trade Labeling Organization, 2008)

Conventional Trade Supply Chain and the Fair Trade Approach Local Farmers Transporter Exporter Broker Importer Roaster Distributor Retailer Multi Level supply chain Coffee changes hands many times Local Farmers Cooperative Importer Roaster Retailer Reduced involvement of middlemen More money for Farmers Conventional Trade Fair Trade Approach

Where does the Coffee $$ Go? Conventional Coffee Fair Trade Coffee Source: EWB Fair Trade Coffee Workshop

Coffee Price History Source: International Coffee Organization

Conditions for Fair Trade Certification Farmers create democratic cooperatives, Standards for hired labours No forced or child labour Must adhere to health and safety standards Implement programs to improve environmental sustainability

EWB Fair Trade Coffee Workshop Certification Process ProducersImportersLicensees (Processors)RetailersConsumers FLO International TransFair Canada

Effects on the Grower and Community Farmers become empowered because of the democratic cooperative Ensure price covers cost of production and cost of living Social premiums towards community development Access to credit (up to 60% of purchase price) Long term commitment from buyer Environmental protection because of sustainable farming methods that are mandated Education and capital to help diversify crops to reduce dependence on coffee only

Effects on the Buyer Feel like part of a larger movement Make a connection to farmers Drinking higher quality coffee Help lift farmers in developing countries out of poverty EWB Fair Trade Coffee Workshop

ACOC, Colombia (Asocacion de Caficultores Organicos de Colombia) Co-op Established: 1992 Year Certified: 1994 Case Study and pictures courtesy of Case Study

EWB Fair Trade Coffee Workshop Case Study ACOC Community Improvements: Education: 5 university technical scholarships / year Provides primary and secondary school supplies Productive Investment: Purchased new processing equipment

EWB Fair Trade Coffee Workshop Case Study ACOC Community Improvements: Environment: Pest control and fertilization education Assisting the transition to organic production Health: Economic support for emergency medical care, housing improvements and disaster relief

What can you? Step 1. Know about Fair Trade. Identify the Transfair logo and know what the term “Fair Trade Certified” means. Step 2. Connect with a Farmer Understand how your choices affect a farmer in a developing country. Step 3. Buy Fair Trade! Support a developing country farmer by buying Fair Trade coffee, tea, sugar, chocolate etc.

Where can I get Fair Trade Products? Got to for an interactive map of locations in the Ottawa Area. Bread and Sons Bridgehead 10,000 Villages Francesco’s Coffee Green Door Restaurant Human Beans Coffee Company..etc.

For more information: Check out websites of Transfair Canada Oxfam International Oxfam International Thank you!

Fair Trade’s approach Reduce involvement of middlemen Encourage farmers to work with community cooperatives Certify products comes from certified producer organization Local Farmers Cooperative Importer Roaster Retailer

Living on $2 per day

To make it fair… Local Farmers Cooperative Importer Roaster Retailer

Fair Trade is a movement By creating an international system of doing business based on dialogue, transparency and respect Contributes to sustainable development by offering better trading conditions for producers and workers in developing countries

Major issues from conventional trade Low, fluctuating world market price Unfair international trade rules Lack of access to markets, credit and technology Bad work conditions for farmers, laborers Environmental & health impacts of monocultures and pesticides use

Major issues from conventional trade Low, fluctuating world market price Unfair international trade rules Lack of access to markets, credit and technology Bad work conditions for farmers, laborers Environmental & health impacts of monocultures and pesticides use

Fair Trade makes trade fair by Ensuring the products certified are: Direct Trade Fair Price Access to credit Long term commitment Local Community Development Environmental protection