Cost of coffee.indd - RISC

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Actionpage: Pros & cons 38 PROS Guaranteed minimum price for producers • covers production costs • can make a real difference to small farmers – provides cash necessary for medical costs, education etc • if prices collapse the guaranteed price ensures farmers can survive Better conditions for wage labourers • International Labour Organisation standards for large plantations, eg national minimum wage, right to form & join trade unions, minimum health & safety standards, child labour prohibited Social premium benefits the wider community • funding for development projects – health, education etc • long term impact of improved education Equal opportunities promoted • income generation & economic independence for marginalised groups – women, people with disabilities, landless etc • women may have access to credit, also improving children’s lives Democratic processes promoted • many small scale producers form cooperatives, which are often members of larger associations – these are able to support producers during crises, eg crop failure or hurricane damage Commitment to long term trading relationship • producers can plan for personal spending & invest in farm improvements Fewer links in production chain • less opportunity for unscruplous dealers • production processes more transparent – greater accountability, eg rights for farmers to check weight & quality control • direct traceability of some products • brings producers & consumers closer Gives a voice to Southern producers • producers involved in negotiations over prices with fair trade suppliers CONS (limitations) Fair trade located in an unfair trade system • world trade controlled by rich ‘Northern’ countries (G8) which dominate international organisations, eg International Monetary Fund (IMF) & World Trade Organisation (WTO) • tariffs against imports of processed goods into ‘Northern’ countries, so concentration on agricultural commodities – coffee, tea, cocoa, honey (the main fair trade products) – which fetch low prices on volatile world markets • prices paid to fair trade producers are still low and, at best, only allow small farmers or wage labourers to address some of the worst symptoms of poverty – development indicators, eg infant mortality, access to clean drinking water, literacy levels, remain poor • fair trade still subject to rules set by the WTO – TNCs (Trans-national Corporations) have objected to ‘ethical’ labelling on the ground of ‘unfair’ trading practices, eg GM-free crops & dolphin-safe tuna • by itself, fair trade does not change the existing system – it may just exist as a marginal ‘ethical’ niche market Maintains dependance on export markets • vulnerable to unpredictable Western fashions & style • best land used for cash crops rather than local food production which would provide increased food security No absolute guarantee on child rights • children involved in family production may be prevented from going to school Fair trade dominated by the ‘North’ • despite the involvement of producers’ representatives in decision making, labelling organisations dominate process of setting criteria, monitoring, marketing etc – they have more power because they are closer to the consumer and can choose which producers to work with Other important ‘ethical’ criteria ignored • existing Fair Trade Marks do not rate products in terms of contribution to more sustainable development, eg GM-free, organic, locallyowned production, small scale farmers • no additional premium to cover extra time involved in environmental protection or organic production, so may not cover full costs
Farmers still take most of the risks • risks, eg crop failure due to weather or pests, is not shared by consumers and processors Minimum environmental standards • increasing organic production • reduction in pesticide use • intercropping for small scale farmers encouraged – combining food & cash crops and increasing food self sufficiency Contributes to food/craft miles • environmental impact of transporting products – fuel emissions destroy ozone layer & increase greenhouse gases Fair Trade contributes to our high consumption society • Fair Trade does not question whether our high consumption society is sustainable or desirable Revitalise indigenous skills • new markets provide opportunities for declining traditional crafts Raise public awareness of development issues • campaigning & educational work can create a climate for fundamental change to the unfair international trading system • fair trade campaign & marketing materials often include information about living conditions, culture etc Marketing perpetuates stereotypes • advertising often uses same exotic ‘ethnic’ stereotypes as popular media Feel-good factor prevents further action • consumers may not feel that they need to act to change the unjust trading system which continues to exploit most producers illustration: Maurizio Forestieri “ The dishonesty of Nestle’s approach is all too familiar. Nestlé’s advertisement [Bridging the generations, Radio Times, 3-9 December] and website for its Fairtrade product imply it will have a significant impact on farmers in El Salvador and that the company’s activities in the coffee industry are ethical. The truth is only about 200 farmers in El Salvador supply coffee for Partners’ Blend and over 3 million farmers globally who are dependent on Nestlé remain outside the Fairtrade system. Nestlé is held partly responsible for forcing down prices paid to suppliers, driving many into poverty, while its own profits have soared. Recently I interviewed a researcher from Colombia who told me 150,000 coffee farming families have lost their livelihoods due to Nestlé policies. Baby Milk Action press release, 7 December 2005 ” 39
Page 2 and 3: credits devised, written and design
Page 4 and 5: “ A company that adopts and imple
Page 6 and 7: the instructions What you need - ge
Page 8 and 9: glossary bluewash The ploy used by
Page 10 and 11: coffee file Coffee: adaptation of A
Page 12 and 13: 8 the story of coffee D the coffee
Page 14 and 15: wet method D requires the use of re
Page 16 and 17: 200 Robusta coffee market 1986-2005
Page 18 and 19: drinker roasted, ground, instant CO
Page 20 and 21: 16 key ideas ◆ ◆ ◆ ◆ ◆
Page 22 and 23: Profit margins are high - Nestlé h
Page 24 and 25: key ideas ◆ ◆ ◆ ◆ In respon
Page 26 and 27: • because of past price fluctuati
Page 28 and 29: aim a fair price? ◆ To analyse th
Page 30 and 31: ◆ Although in The coffee cycle Ne
Page 32 and 33: s Analyse the photos used and the o
Page 34 and 35: ◆ ◆ Real costs A supply and dem
Page 36 and 37: aim how fair’s fair? ◆ To explo
Page 38 and 39: actionpage: how fair’s fair? s Re
Page 40 and 41: 1990 european fair trade associatio
Page 44 and 45: aim fair marketing ◆ To analyse t
Page 46: Actionpage: Logo ® 42
Page 49 and 50: actionpage: press release Statement
Page 51 and 52: appendix 1: the coffee crisis The I
Page 53 and 54: demand sides in which the coffee cr
Page 55 and 56: demonstrating that traditional shad
Page 57 and 58: appendix 4: co-op’s fairtrade cof
Page 59 and 60: appendix 5: mugged introduction The
Page 61 and 62: women earn less, work longer, have
Page 63 and 64: appendix 6: rescue plan A Coffee Re
Page 65 and 66: Consumer governments 1 Provide poli
Page 67 and 68: joining forces we believe that we w
Page 69 and 70: of shortfalls that occur (see Nestl
Page 71 and 72: appendix 8: robbing coffee’s crad
Page 73 and 74: appendix 9: behind the mask the rea
Page 75 and 76: • change the law to enable people
Page 77 and 78: Fair Trade in Action - KS 3-4 Fairt
Page 79 and 80: ackground reading* Behind the mask:
Page 81 and 82: useful contacts Anti-Slavery Intern
Page 83 and 84: International Coffee Organisation w
Page 85 and 86: isc Reading International Solidarit

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