A Niche for Sustainability? Fair Labor and Environmentally Sound Practices in the Specialty Coffee Industry

Globalizations (Impact Factor: 0.47). 06/2008; 5(2):231-245. DOI: 10.1080/14747730802057621


Facing a worldwide coffee crisis in which prices fell to levels that do not support small-scale production or living wages for coffee workers, nongovernmental organizations (NGOs) and specialty coffee companies have attempted to promote transparent and sustainable exchanges between producers and buyers. The NGO-based initiatives are diverse; they may focus on improving the lot of small farmers via Fair Trade, emphasize environmental protection, provide technical and/or business assistance to producers, or offer differentiating certifications based how producers score on a long list of social and environmental indicators. Specialty coffee roasters have introduced their own comprehensive sustainability projects. This is a critical review of many sustainability projects and their outcomes to date, including two examples of smallholder farmer-NGO collaborations that have yielded positive results.A Chinese version of this article's abstract is available online at:

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    • "Since the coffee crisis, national governments, NGOs and international donors have promoted the marketing of coffee through group-based, certified market channels as a viable business model for poor smallholders (Kilian et al., 2006; Linton, 2008; Willer and Yussefi, 2007). The changes in consumer demand and policy thinking have led to a growing body of literature investigating the effects of environmental and social certification standards on environmental indicators like tree, mammal, bird, and butterfly species (Gobbi, 2000; Gordon et al., 2007; Philpott et al., 2007) as well as on socio-economic indicators. "
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    ABSTRACT: Governments, donors and NGOs have promoted environmental and social certification schemes for coffee producers as certified market channels are assumed to offer higher prices and better incomes. Additionally, it is presumed that these certifications contribute to poverty reduction of smallholders. Yet, gross margins, profits and poverty levels of certified smallholder coffee producers have not yet been quantitatively analyzed applying random sampling techniques. Our quantitative household survey of 327 randomly selected members of conventional, organic and organic-fairtrade certified cooperatives in Nicaragua is complemented by over a hundred qualitative in-depth interviews. The results show that although farm-gate prices of certified coffees are higher than of conventional coffees, the profitability of certified coffee production and its subsequent effect on poverty levels is not clear-cut. Per capita net coffee incomes are insufficient to cover basic needs of all coffee producing households. Certified producers are more often found below the absolute poverty line than conventional producers. Over a period of ten years, our analysis shows that organic and organic-fairtrade farmers have become poorer relative to conventional producers. We conclude that coffee yield levels, profitability and efficiency need to be increased, because prices for certified coffee cannot compensate for low productivity, land or labor constraints.
    Preview · Article · May 2011 · Ecological Economics
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    • "Other benefits have included improved access to credit and international support, access to local development networks, and in several cases higher levels of school attendance among youth, as some cooperatives have used the Fair Trade Premium to fund scholarships for youth (Jaffee 2007; Mendez 2008; Taylor 2002; Utting 2009; Arnould et al. 2009). Access to Fair Trade aids smallholder cooperatives in networking with international development organizations that can help pay for social development projects as well as organic certifications (Linton 2008). Latin Americanbased field research also sheds light on the limitations of a certified Fair Trade only approach to sustainable livelihoods. "
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    ABSTRACT: Why do relatively few Salvadoran farmers sell to Fair Trade certified markets? This article examines the proximate and root causes that limit the participation of coffee smallholders in Fair Trade markets. Drawing upon a historical analysis of rural coffee society in El Salvador as well as Fair Trade value chains and the empirical evidence from two case studies, one in El Salvador's Eastern mountains, and the second in the Western coffee growing region, this study illustrates the practical obstacles to participation in Fair Trade. It also shows how farmers are developing alternative marketing solutions such as direct trade and selling organic coffee domestically. The findings suggest that smallholders currently face at least five barriers to accessing Fair Trade, including: certification costs, economies of scale to cover coffee exports operations, stringent quality requirements and altitude constraints. However, the root causes of smallholder coffee farmers' limited access to Fair Trade are rooted in decades of state-based policies and politics that have undermined rural civil society, discouraged education, perpetuated uneven access to land and debt forgiveness, and repressed the development of dynamic cooperative unions with capacity to export smallholder coffee. Resumen: ¿Por qué pocos agricultores salvadoreños venden a mercados de "comercio justo"? Este artículo examina varias causas que limitan la participación de pequeños productores de café. Basado en un analisis historica de sociedad y café en el Salvador y de las cadenas de valor con dos estudios caso, uno en la sierra oriental y otro en la región oeste, ilustran los obstáculos prácticos de participar en comercio justo y notan como los productores han desarrollado soluciones alternativas tales como comercio directo y un mercado doméstico para café orgánico. Algunas de las barreras que ellos confrontan incluyen los costos de certificación, las economías de escala para cubrir las operaciones de exportación, las rigurosas exigencias de calidad y la limitación de tierra alta para su cultivo. Sin embargo, causas históricas como la represión de la sociedad civil, las desigualdades en el acceso a la tierra, y problemas con la deuda, también han afectado este sector. Una desventaja corriente que los pequeños productores deben negociar es el sistema de políticas estatales que han desalentado históricamente el desarrollo de uniones cooperativas dinámicas con capacidad para exportar el café producido.
    Full-text · Article · Jan 2011 · Journal of Latin American Geography
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    • "Fair trade coffee consumption worldwide is growing annually 20% (FLO, 2007). Thus, national governments, NGOs and international donors promote the marketing of coffee through group-based, certified market channels as a viable business model for poor small-scale farmers (Linton, 2008, Willer and Yussefi, 2007). "
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    ABSTRACT: The marketing of coffee through group-based, certified market channels is often promoted by governments and donors as a viable business model for poor small-scale farmers. Organic and fairtrade coffees have become very popular among socially, environmentally and health conscious consumers in recent years. While coffee certification programs have been in place for over fifteen years, there are few studies on the welfare impacts of certification schemes. Therefore, this research seeks to analyse the impacts of certification on poverty alleviation and to identify the critical factors which explain success or failure of certification schemes. We use a combination of qualitative and quantitative research, comparing small-scale coffee producers in northern Nicaragua who are organized in conventional, organic, and organic-fairtrade certified cooperatives. Our results indicate that certification schemes have a low impact on poverty, including the aspect of food security. Reasons are seen in low yield levels, indebtedness, lack of entrepreneurial skills as well as cooperatives’ management capacities. We conclude that unfair trading conditions are not the main cause of poverty among smallholder coffee growers in Nicaragua. Thus, policies and projects need to address entrepreneurial skills of farmers and cooperative managers as well as amplify extension services.
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