Why Fair Trade?
Because coffee is so widely traded and consumed, it has an immense impact on the economic well-being of people in poor countries and offers one of the most promising avenues for bringing about positive change. For this reason, One World Roasters fully supports fair trade practices to bring you the most perfect coffees from around the world. For more information, we have included the following from Global Exchange's Coffee FAQ webpage...
What is the commodity chain of the coffee industry?
Coffee is an extremely powerful commodity, reigning as the world's most heavily traded product, behind petroleum, and the largest food import of the United States. The global commodity chain for coffee involves a string of producers, middlemen, exporters, importers, roasters, and retailers before reaching the consumer.
Coffee is a vital source of export for many of the developing countries that grow it. Some 20 million families in 50 countries now work directly in the cultivation of coffee; an estimated 11 million hectares of the world's farmland are dedicated to coffee cultivation. Arabica and Robusta are the two principle species of coffee harvested today. Approximately 70% of the world's production is the Arabica bean, used for higher-grade and specialty coffees, and 80% of this bean comes from Latin America. Robusta is grown primarily in Africa and Asia.
Most small farmers sell directly to middlemen exporters who are commonly referred to as coyotes. These coyotes are known to take advantage of small farmers, paying them below market price for their harvests and keeping a high percentage for themselves. In contrast, large coffee estate owners usually process and export their own harvests that are sold at the prices set by the New York Coffee Exchange. However, extremely low wages ($2-3/day) and poor working conditions for farmworkers characterize coffee plantation jobs.
Importers purchase green coffee from established exporters and large plantation owners in producing countries. Only those importers in the specialty coffee segment buy directly from the small farmer cooperatives. Importers provide a crucial service to roasters who do not have the capital resources to obtain quality green coffee from around the world. Importers bring in large container loads and hold inventory, selling gradually through numerous small orders. Since many roasters rely on this service, importers wield a great deal of influence over the types of green coffee that are sold in the US.
There are approximately 1200 roasters in the US today. Large roasters usually have one blend of recipes and sell to large retailers - the Big Three (Kraft, which owns Maxwell House and Sanka, owned by Philip Morris; Procter & Gamble, which owns Folgers and Millstone; and Nestle) maintain over 60% of total green bean volume. Microroasters, or those who roast up to 500 bags of coffee a year, offer the product we know as specialty coffee. Most roasters buy coffee from importers in small, frequent purchases. Roasters have the highest profit margin in the value chain, thus making them an important link in the commodity chain.
Retailers usually purchase packaged coffee from roasters, although an increasing number of retailers are also roasting their own beans for sale. The Specialty Coffee Association of America estimated that there are 10,000 cafes and 2,500 specialty stores selling coffee. Chains represent approximately 30% of all coffee retail stores. However, supermarkets and traditional retail chains are still the primary channel for both specialty coffee and non-specialty coffee, and they hold about 60% of marketshare of total coffee sales. Around the globe, the annual consumption of coffee is 12 billion pounds and in the U.S. alone, over 130 million consumers are coffee drinkers.
How does Fair Trade address environmental issues?
Coffee farming originally developed in Africa as an understory crop beneath diverse shade trees that provided habitat for wildlife such as birds, butterflies, insects, and animals. Traditional farmers usually use sustainable agricultural techniques including composting coffee pulp, rotating crops, and not applying expensive chemicals and fertilizers. In addition, they usually cultivate food alongside cash crops, and intercrop other plants such as banana and nut trees which provide food security as well as additional sources of income.
In the 1970s and 80s, as part of the general shift to 'technified agriculture' during the so-called Green Revolution, the US Agency for International Development and other groups gave $80 million dollars for plantations in Central America to replace traditional shade grown farming techniques with 'sun cultivation' techniques in order to increase yields. This resulted in the destruction of vast forests and biodiversity of over 1.1 million hectares. 'Sun cultivated' coffee involves the cutting down of trees, monocropping, and the input of chemical fertilizers and pesticides. This type of industrial coffee farming leads to severe environmental problems, such as pesticide pollution, deforestation and the extinction of songbirds through habitat destruction. The Smithsonian Institute has identified industrial coffee production as one of the major threats to songbirds in the hemisphere due to deforestation - the birds no longer have a habitat in which to live. Soil and water sources continue to be severely degraded by many coffee farms, as coffee pulp is often dumped into streams. In addition to the harmful effects on the environment caused by the use of chemical pesticides and herbicides in coffee cultivation, workers are also at risk of drinking contaminated water and being poisoned by pesticides.
For these reasons, many bird, tree, and biodiversity conservationists have developed standards for promoting "shade-grown" or "bird-friendly" certified coffee -- that is, coffee grown under a canopy of diverse trees that provide habitat to birds. The Smithsonian Migratory Bird Center, as well as Rainforest Alliance and the Seattle Audubon Society, all promote various labels of coffee that promote tree and bird conserving farming practices. In addition, many consumers are committed to purchasing organic coffee in order to promote sustainable farming techniques in poor countries.
For more information, please visit Global Exchange Coffee FAQ.
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