Exchange Value: Is fair trade coffee all it’s cracked up to be?

Nothing better demonstrates the impact of coffee on society than numbers. Here are some to contemplate: Coffee is the second-most traded commodity (by volume) in the world after oil. Americans consume seventeen gallons per capita annually. 647,000 tons of coffee beans were imported into the United States in 2001.

Then there are the disheartening stats: According to Coffee Kids, an international not-for-profit organization dedicated to helping coffee-farming families improve the quality of their lives, 25 million families worldwide depend on coffee agriculture as their primary source of income. Yet coffee farmers in developing countries might earn as little as four cents per pound of coffee they grow.

The difference between the money paid for coffee and the income being received by those producing it is an obvious cause for concern, since most coffee producers live in poverty-stricken developing countries like Guatemala, where-Coffee Kids claims-there is only one doctor for every 85,000 people, and 43 children out of every thousand die before turning 5 (in the United States, the number is 6.32). Within the last decade, Americans have taken notice, using consumer choice as political expression to buy Fair Trade-certified coffee from their favorite coffeehouses. For a marginally higher price, café patrons can buy coffee with a clean conscience: Fair Trade certifies that coffee farmers receive a fair wage from the coffee they produce.

Yet, for its global importance, Fair Trade coffee makes a local impact. On the South Side of Chicago, that impact is cause for ambivalence. While the social responsibility Fair Trade offers is a feel-good commodity, it is, like four-dollar lattes, a privileged one.

“Fair Trade” refers to Fair Trade Certification, a process carried out by an international consortium of twenty Fairtrade Labeling Organizations (FLO) since 1999. In the United States, the certifying organization is TransFair USA. When a shipment of agricultural products enters the United States and meets the board’s standards, it gets slapped with a licensed sticker, a black-and-white stick figure bearing coffee bowls that appears on all the subsequent portions that come from that first shipment.

To receive certification, agricultural products must meet strict standards. First and foremost, it must be purchased at a fair price. In developing countries, cooperatives, which include multiple farming families on different plots of land tied together by a collective decision-making body, are guaranteed a minimum floor price by Fair Trade importers. Further, the coffee must be produced on cooperatives employing fair labor practices, democratic labor organization, and sustainable farming methods.

While TransFair USA certifies products including chocolate, tea, herbs, fruit, sugar, rice, and vanilla, coffee is by far the largest segment of foreign agricultural products falling under Fair Trade review. In 2005, 45 million pounds of coffee were certified Fair Trade, more than in any of the previous six years. Through 2005, 119 million pounds of coffee entered the United States decorated with the black-and-white emblem of Free Trade Certification. And the money being made is–ostensibly–accomplishing Fair Trade’s goal. According to TransFair’s latest annual report, $14 million in additional income went back to 400,000 coffee-farming families in 2005.

To the consumer on the street, the defining characteristic of Fair Trade coffee is its price. Because of the benefits it offers–not least being the price floor it promises to TransFair-member farmers–Fair Trade coffee consistently costs more than coffee offered at market price. Curiously, that has not stopped it from becoming a regular offering–if not the only offering–at venues throughout the country.

At the University of Chicago, students will no longer have a choice. Currently, all four coffee shops operated by the Office of the Reynolds Club and Student Activities (ORCSA) buy and sell only Fair Trade coffee from Metropolis Coffee Company (though Fair Trade is not the only coffee available from Metropolis). Classics Café and the shop in Stuart sell Fair Trade coffee from Intelligentsia. In Winter Quarter, the Divinity School (Div School) Coffee Shop on the lower level of Swift Hall, which currently offers a choice between Fair Trade coffee and regular wholesale, will switch exclusively to Fair Trade coffee. “Well, we’re restructuring the coffee shop,” explains manager Sarah Brown. “Since we are the Divinity School, and if our motto is sort-of unofficially ‘Where God drinks coffee,’ [we asked,] ‘What coffee would God want to drink?’ We were looking at what would be the most ethical way to treat coffee.” The change may cost the Div School Coffee Shop the unofficial title of cheapest coffee on campus. Starting in January, a small coffee will cost a minimum of one dollar, equaling the prices at nearby Cobb Coffee Shop, the Div School’s chief competitor. The mark-up will be due mostly to Fair Trade beans. “It’s partly because we’ll be selling more Fair Trade…but also to off-set some of the espresso and milk costs,” Brown says.

ORCSA’s coffee shops switched to a new roaster, Chicago’s Metropolis Coffee, in the spring, but the primary attraction was not the availability of Fair Trade beans. “We wanted to have a more local focus with our coffee. We work really hard to have local vendors [sell food], and we wanted that to carry that over to our coffee as well,” says Coffee Shop Coordinator Stacey Brown, who has also worked as a coffee roaster, wholesaler, and barista trainer. “It is important to me to support local business. And Metropolis ended up being the right fit.” All of the Metropolis coffee bought and sold by ORCSA’s shops, however, is also Fair Trade Certified.

Even if caffeine addicts could choose, would Fair Trade influence consumer decisions? Between the ORCSA shops and the Div School, only the latter currently offers a choice. “We sell more Fair Trade,” Sarah Brown states, matter-of-factly. “But it’s fairly evenly demarcated between people who only buy Fair Trade and people who only buy regular. I think the people who buy the regular, I think that has more to do with that it’s cheaper. And the people who buy the Fair Trade are very loyal and get upset if we run out of it and have to have regular. I don’t know if it’s taste- or ethos-related, but they’re pretty loyal to getting the Fair Trade.” Stacey Brown adds, “I do honestly think [Fair Trade] makes a difference. I think a lot of people see it as a socially responsible choice. I mean, no one wants to not pay someone a livable wage.”

Yet, despite its appeal to the socially conscientious, Fair Trade Certification is not perfect, nor is it necessarily effective.

“People need to understand that Fair Trade is only one approach to sustainability,” contends Tony Dreyfus, the owner of Metropolis Coffee, ORCSA’s supplier. “It primarily certifies that coffee is coming from cooperatives.” Stacey Brown confirms, “[Fair Trade], in general, is growers coming together in a cooperative and then negotiating a fair price.” Knocking the table for emphasis on every syllable, she adds, “The key there being that it is–has to be–a cooperative.”

For Dreyfus, the cooperative corollary is cause for concern. “Fair Trade limits farmers in their ability. Most Fair Trade coffees are blends, with beans from several mountains included in a single harvest. If a Fair Trade farmer makes a gourmet coffee, it doesn’t matter because it will be mixed in with lesser beans,” he says. Blends diminish the particular flavors that coffees, like fine wines, retain from their place of origin. Moreover, Fair Trade creates an implicit limit on the price individual farmers can command, since superior coffee which would normally warrant higher prices gets blended to make inferior coffee. Fair Trade farmers get a mandated price floor, certainly, but a ceiling comes with it.

The economics of Fair Trade Certification, however, are only one indictment. Ever since their inception in the Great Britain of the 17th century, when fops, dandies, and intellectuals feigned Turkish debauchery while sipping boiled coffee cherries, coffeehouses have always been the peculiar territory of higher classes. The coffeehouse as a marker of class persists to the Chicago of today. According to numbers from the University of Chicago Cultural Policy Center and the University administration, Hyde Park, an area comprising two ZIP codes, has ten coffee shops. In the five ZIP codes surrounding the neighborhood, including parts of Bronzeville, Washington Park, Woodlawn, and Oakland, there are three. The median household income in Hyde Park, according to the last census, is $36,454. In the surrounding neighborhoods: $16,855. (A similar argument could be made that race is also turned into a dividing line: Lincoln Park alone has eleven Starbucks franchises; South Shore, one of the wealthiest African-American neighborhoods in the city, has one.) This fact alone leaves Fair Trade prone to being the latest armchair philanthropy organization fetishized by privileged do-gooders, while poorer consumers receive no chance to exercise their empathy. Yet Fair Trade does nothing to alleviate that potential.

The most damning evidence lies in the coffee itself. “At places like Wendy’s, McDonald’s, and Dunkin’ Donuts, for the most part, [the coffee] is going to be robusta, which is a cheap, hearty, low-grown, virtually disease-free species, and so it is not as expensive to produce,” explains ORCSA’s Brown. “Arabica [the species sold by Fair Trade cooperatives] is a higher grade of coffee. It tastes better when roasted. It’s generally grown higher up-at a higher altitude-and is decidedly finicky. It’s on mountaintops, and it’s hand-picked because of it.” In other words, Fair Trade coffee is high quality, gourmet coffee that only rich coffee-drinkers can afford anyway, regardless of Fair Trade certification.

Roasters like Dreyfus, while still importing Fair Trade coffees, have recently started taking a quality-based approach to the coffee they sell. “We are trying to make coffee a gourmet item like wine, and what beer has become recently,” Dreyfus says. And gourmet items command gourmet prices. Dreyfus explains, “The price for Fair Trade coffee is currently $1.21 per pound. I have not paid less than two dollars per pound for any coffee for a long time.” Moreover, Metropolis eschews middlemen in favor of buying directly from sellers. “It’s frustrating when people come [into Metropolis Café] and won’t try a kind of coffee because does not have a Fair Trade sticker on it,” Dreyfus laments. “I try to explain that the coffee is exceptional coffee purchased directly from the farmer, and that we pay a price worlds above the Fair Trade-mandated price, but in the end there is no sticker, and so they won’t try it.”

Despite these flaws, Fair Trade continues to be a popular option for concerned drinkers interested in making a fair deal. As the Div School’s Brown concludes, “It’s not perfect, but Fair Trade is the most ‘buyable’ option. It’s currently the best way to ethically sell coffee.”