Is 'Fair Trade' fair?
We are invited to buy 'fair trade' coffee to sustain small producers against the giant multi-nationals. The fair trade stuff costs more, but we are told we can buy it with a clear conscience. The fair trade movement believes that small growers are not receiving enough for their crop. Certainly world coffee prices have declined rapidly over a decade, and the reason is simple: since 1990 supply has increased by 15%. International aid was given to Vietnam to set up the coffee plantations which have produced much of the over-supply. In Brazil and Columbia, producers were encouraged to switch from cocaine to coffee. By introducing efficiency and good management, some producers can pay good wages, and provide education and other benefits. Some have switched to the high quality beans instead of the low quality 'robusta' variety. But the coffee cannot be labelled 'Fair Trade'. Their farms are deemed too big to be eligible. Conversely, the typical fair trade producer is small and inefficient, with the coffee produced often of low quality. It is why such producers find it difficult to earn a decent living. One obvious solution is to get them to switch to something else. Instead of trying to keep inefficient production going by paying higher prices, we should be letting their alternative products into our markets.