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  1. #1
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    FAIR TRADE : Does it help poor workers?

    I am not a fan of Fair Trade, nor any other coffee related organizations that were created by other rich countries or companies.
    this Video really explain what Fair Trade is about, in very concise form, and raises some questions what we have to do to really help the poor workers / pickers.

    By the way, when we talk about "helping farmers" by Fair Trade, RainForest...etc, you might be thinking about "helping & paying more money to the farm "owners"", but farm owners do not really need help from us. Most of them are already rich enough to have the land and hire workers.

    It is the workers / cherry pickers in that farm which is the 99% of coffee rated work forces around the world.

    https://www.youtube.com/watch?v=ui5ruDbpyy0

    so, if you have time, please check out this video, only 3 min, and give us your comments HOW WE CAN REALLY HELP THE POORS.

    thanks

  2. #2
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    Quote Originally Posted by ensoluna View Post
    I am not a fan of Fair Trade, nor any other coffee related organizations that were created by other rich countries or companies.
    this Video really explain what Fair Trade is about, in very concise form, and raises some questions what we have to do to really help the poor workers / pickers.

    By the way, when we talk about "helping farmers" by Fair Trade, RainForest...etc, you might be thinking about "helping & paying more money to the farm "owners"", but farm owners do not really need help from us. Most of them are already rich enough to have the land and hire workers.

    It is the workers / cherry pickers in that farm which is the 99% of coffee rated work forces around the world.

    https://www.youtube.com/watch?v=ui5ruDbpyy0

    so, if you have time, please check out this video, only 3 min, and give us your comments HOW WE CAN REALLY HELP THE POORS.

    thanks
    Ensoluna, this is a very fascinating subject for me because I'm, as a consumer, becoming more and more aware of what I purchase and how that purchase effects others. I'll admit that as a "Westerner" I was under the assumption the FTO is a good thing under the assumption that workers actually get a higher, more livable wage. Which to me is a positive exchange for me paying a little bit more for the things that I like. I really do hate the politics that's injected into so much that's meant to level the playing field. I hadn't considered that FTO doesn't actually provide for the actual worker. Isn't that part up the farm owners? With that question raised does FTO actually stipulate that the farmer pass the increase on to the workers too? Also, without a part of FTO that worker is guaranteed a lower wage so where does it end? In that scenario I'd say it's up to the farm owner to make sure that they pass the increase on to the worker as well.
    "There's coffee in that nebula."- Katherine Janeway

  3. #3
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    I hadn't considered that FTO doesn't actually provide for the actual worker. Isn't that part up the farm owners?

    Ensoluna : Farm owners are farm owners and workers are workers. they are entirely separate. As example, we have a coffee farm. when harvest season comes, we hire about 30 people to pick the coffee cherries. they are just near village workers. Just because farm owner gets rich does not mean the real pickers will receive more money.


    With that question raised does FTO actually stipulate that the farmer pass the increase on to the workers too?


    Ensoluna : No, it is not. FTO only works with NOT DIRECTLY WITH FARMERS, BUT WITH COOPERATIVES. It is Cooperative's responsibility to have farm owner's to follow FTO regulation. When cooperatives get extra money, they pay to the farm owners, not to workers. It is up to farm owners to pay extra to workers or not.

    Also, without a part of FTO that worker is guaranteed a lower wage so where does it end?


    Ensoluna : I do not know about other countries, but in Guatemala, whether the farm is Organic or FTO..whatever, the coffee pickers/workers get paid around $7 to $80 per day's work. I have never heard of any workers who get paid considerably more because the farm is Organic or FTO.

    In that scenario I'd say it's up to the farm owner to make sure that they pass the increase on to the worker as well.

    Ensoluna : yes, it is up to the farm owner. But no one does. Here is an example for you.
    Let's say that our farm is FTO or Organic and we produce 500 bags of coffee which is good medium size. In order to become FTO / Organic, there are a lot of regulations and fees you have to pay to join, about up to 10% of your net income.

    And since FTO prohibits from Child under 15 from working, we have to hire only adults with full pay. (In case of not following child law, when you hire a worker, normally, they family comes, including children, and help their parents to earn more money because workers get paid by how much pounds they pick a day) so basically a lot of workers do not like to work for the farm which is FTO/Organic. if you are organic farm, you will lose 30% of your production, compared to Chemical farm. that is a known fact. So you produce 350 bags instead of 500. you deliver 350 bags to cooperative. But in that year, the coop's customer does not want to buy everything and only buys 200 bags with extra $0.20 more which is standard rate for Organic. then, the rest 150 bags will be sold as normal coffee to other people who does not want organic/FTO.

    So, the bottom line is that farmer loses 150 bags of production, only gets paid $0.20 extra for only 200 bags. So at the end, farmer loses money which is most of case. I am not making this up because our farm wanted to be Organic 10 years ago and due to low income, we had to convert back to regular farm (no Organic / FTO) and using chemical fertilizers about 6 years ago.

  4. #4
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    Wow! With all that I can see how farmers are not seeing the benefits of becoming FTO or Organic aside from being able to tout the labels on the brand which is very popular here in the States. Who really benefits from these coop's then?
    "There's coffee in that nebula."- Katherine Janeway

  5. #5
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    Quote Originally Posted by LoveCoffeeLife View Post
    Wow! With all that I can see how farmers are not seeing the benefits of becoming FTO or Organic aside from being able to tout the labels on the brand which is very popular here in the States. Who really benefits from these coop's then?
    The real beneficiaries are Big Coffee exporters and big importers. Also probably USA wholesales and retails might benefit.

    here in Guatemala, the big problem with FTO/Organic is that many big Coffee exporters (int'l big companies like Olam, Export Cafe..etc) is forcing "poor" cooperatives to comply with FTO, so that they can dictate the market share and sell to overseas. 90% coffee sales in poor coffee regions are to huge coffee int'l exporters. So, if they do not comply, the poor cooperatives will be forced out or left out from selling their coffee.

    so, these poor coops are also forcing other small poor farms to turn Organic / FTO.
    for the poor farms, they have no choice but to turn FTO because they are just too small to sell directly to overseas customers. and other coops (who is not forcing to turn FTO) are too far from the farm that they can not work with them. So, all the small farms must follow knowing that would not be a good choice for them.

    The worst thing is that when these small farms finally go belly up, too much expenses for FTO..etc, not enough sales, 30% less yield..etc, Big and Rich other farm owners are buying off these small farms at penny for dollar!

    So, what should we do? Boycott FTO/Organic, Rainforest..etc. when there is no market for these BS certificate, then, at least most of poor farmers can get decent yield and sales at the end.
    Last edited by ensoluna; 03-19-2017 at 06:50 PM.

  6. #6
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    The b.s. just doesn't stop with the politics of the certifying bodies. As a roaster, we are not "officially certified" but we do purchase organic greens and sell them as such. The issue being that in order to label product an organic as certified, one needs to pay a fee, a royalty on total sales and give free access to audit your books. who in h*@# would give someone free access to your books at any time ? Money is too hard to come by, why would I give up 3% margin right off the top ?

  7. #7
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    Quote Originally Posted by ensoluna View Post
    The real beneficiaries are Big Coffee exporters and big importers. Also probably USA wholesales and retails might benefit.

    here in Guatemala, the big problem with FTO/Organic is that many big Coffee exporters (int'l big companies like Olam, Export Cafe..etc) is forcing "poor" cooperatives to comply with FTO, so that they can dictate the market share and sell to overseas. 90% coffee sales in poor coffee regions are to huge coffee int'l exporters. So, if they do not comply, the poor cooperatives will be forced out or left out from selling their coffee.

    so, these poor coops are also forcing other small poor farms to turn Organic / FTO.
    for the poor farms, they have no choice but to turn FTO because they are just too small to sell directly to overseas customers. and other coops (who is not forcing to turn FTO) are too far from the farm that they can not work with them. So, all the small farms must follow knowing that would not be a good choice for them.

    The worst thing is that when these small farms finally go belly up, too much expenses for FTO..etc, not enough sales, 30% less yield..etc, Big and Rich other farm owners are buying off these small farms at penny for dollar!

    So, what should we do? Boycott FTO/Organic, Rainforest..etc. when there is no market for these BS certificate, then, at least most of poor farmers can get decent yield and sales at the end.
    Yikes! I'll admit that I don't know enough about the industry to answer that. I can only give an opinion. At this point my opinion is the one that keeps small farms up and running profitable and eliminates abusive overbearing regulations. Guess there is still a ways to go. Since you are boots on the ground out there and see this first hand I'll defer to your expertize.
    "There's coffee in that nebula."- Katherine Janeway

  8. #8
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    Quote Originally Posted by wmark View Post
    The b.s. just doesn't stop with the politics of the certifying bodies. As a roaster, we are not "officially certified" but we do purchase organic greens and sell them as such. The issue being that in order to label product an organic as certified, one needs to pay a fee, a royalty on total sales and give free access to audit your books. who in h*@# would give someone free access to your books at any time ? Money is too hard to come by, why would I give up 3% margin right off the top ?
    That is a huge chunk! So then we are back to the basic question. What's to be done? Sounds a lot like fighting the machine to me. Wasn't this whole verified organic thing supposed to be a positive change?
    "There's coffee in that nebula."- Katherine Janeway

  9. #9
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    I got below article from "fairtrade UK" website.

    An average coffee farmer lives on 1.37 a day. With Fairtrade, farmers receive the Fairtrade Minimum Price, which aims to cover costs of production and act as a safety net when market prices fall below a sustainable level. If the market price exceeds the Fairtrade Minimum Price level, then farmers receive the market price. Over the last six months, the Fairtrade minimum price of coffee has been higher than the market price, showing the important role Fairtrade plays.


    Definition of FAIRTRADE MIN PRICE IS : The Fairtrade minimum price defines the lowest possible price that a buyer of Fairtrade products must pay the producer. The minimum price is set based on a consultative process with Fairtrade farmers, workers and traders and guarantees that producer groups receive a price which covers what it costs them to grow their crop. When the market price is higher than the Fairtrade minimum price, the trader must pay the market price.

    In the case of Organic coffee, FTL pays extra $0.30 per pound over the market coffee C pricing.
    as of now, it is around $1.30 per pound. which means, if a farm provide organic, they will receive $1.60? Realistically, they will get about $0.07 extra for Organic because of administration fees, advertising fees, coop fees, FTL fees..etc, that the farmer has to pay.

    So, farmer gets $1.37 for their organic coffee but as we all know, the farmer will lose between 25% to 30% total coffee production when they turn their farm to Organic. Is it worth it? definitely not.

    As example, when a GOOD TRADER OR EXPORTER buys 82 to 84 point SHB beans from a farmer, for direct sales to foreign buyers, mostly roasters, not importers, the farmers can make between $1.95 to $2.15 per pound of their coffee (not organic). That was the going rate last year for us.

    so, what farmers need is to work directly with good roasters around the world.
    Ensoluna S.A. Guatemala
    facebook.com/ensolunausa
    ensoluna.com

  10. #10
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    $1.95 to $2.15 ??? Wow, that seems like alot!
    I was under the impression that most of the small landholders make something like $0.80 per pound.

    My business partner was in central America meeting with an executive of their coffee federation ....... after a certain deep roasting unnamed company has just gotten through with them. They were so mad they could spit. I was told the negotiation was about fractions of a cent and the quality above a certain point was unimportant and not rewardable as they were pooling all the coffee of that region. It as an all or nothing deal.
    Last edited by wmark; 08-19-2017 at 09:14 PM.

 

 
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