The haves and have nots of Australian dairy

The Milk Maid Marian


I’ve had requests from farmers, investors, the media and even politicians for an explanation of how milk prices work (or don’t). I’m going to start with the factors that affect the price a dairy farmer in Australia’s south-eastern states receives.

  1. Who buys Old Macdonald’s milk?

The opening prices of most of the processors are in:

ACM $5.30
Bega $5.00
Lion (variable option) $5.00
NDP $5.00
Warrnambool Cheese & Butter $4.80
Fonterra $4.73
Longwarry $4.60
Burra Foods $4.40 to $4.60
Murray Goulburn $4.31
ADFC To be advised

It’s a massive spread of prices, with the top almost 25 per cent higher than the bottom. And it doesn’t stop there. The pricing systems are incredibly complex, with the prices no more than weighted averages. I know of a farmer supplying MG, for instance, who will receive just $3.79kg MS for his milk. I’ll explain that later in this post.

But, why, you…

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World Fair Trade Organisation (WFTO) conference Milan 2015: Reflections on Fairtrade 101

IMG_6821It is 8 years since I seriously engaged with the WFTO Global conference. Then, in Blankenburg, Belgium (2007) our pioneer Equal Exchange brand was already struggling to compete in crowded UK market beginning to  commodify with Fairtrade. But it was also the year after I first travelled to Kerala to meet the farmers from FTAK and the year we launched Liberation CIC to trade cashew nuts. How far had we come? How relevant was our movement several decades since we began? Was innovation needed?

The 2015 WFTO conference was organised by AGICES the Italian World shops movement, a network of fair trade shops and partner organisations.

This year of the 13th WFTO Biennial, the main venue, Hotel Klima (with its giant green wall and eco credentials) was located in an old industrial zone undergoing transformation, a mixture of IMG_6811immigrant worker housing, old factories, new roads and next to the site of the Milan Expo… was it a homage to neoliberalism or door to sustainable futures, it’s theme ‘Feeding the Planet, Energy for Life’.

I realised that I was hoping for positive transformation and innovation and a (hopefully) critical personal reflection. Perhaps a return perhaps to Fair Trade 101. With two years behind me in Australia, now living on a few acres exploring tropical food crops, trying my hand at what I had advocated for many years I had an appetite for new insights.


Setting the scene

Keynote Speaker Palagummi Sainath was former rural affairs editor for The Hindu until departing for his journey People’s Archive of Rural India, PARI. We were stung by his eloquence and the need for a reality check, in a world seemingly out of control plunging headlong into crisis.

Neoliberalism… trades in two crops… hunger and thirst, harvest self-regenerating poverty. The multiple crisis of …water, of soil… rurality under threat, livelihoods disappearing.

A Global commodity trade, 4 companies ,Archer Daniels Midland (ADM) etc controlling the supply chain hourglass, of the soils of Africa less polluted, now more valued yet off balance sheet

Water crisis… California, experiencing its worst ever drought, where large scale dairy is exempt from regulation and soft drinks have become virtual water… the privatisation of utility continues… ex Uruguay

MARVEL Silva Ridge Estate 23 villas each with swimming pools and in a forest reserve and built by the farmers (now labourers) whose land these ‘opportunities’ now occupy. On the other side of the world less than 2% of US citizens regard farming as their occupation. 85% of US farmers’ income comes from off farm activity…

We were reminded of the terrible suicide statistic, 300,000 over the last 19 year in India alone and the link to other livelihoods. Statistics hide the interconnectedness of our rural lives. When a farm is lost a carpenter is under threat, paid 1/3 in cash and two thirds in kind, perhaps rice and veg, the potters and weavers who make the utensils and homeware are in the same chain, so bankruptcy follows and of course then migration, the largest in human history. These farmers or farm workers have swelled the ranks of the unemployed or under employed

I tried to capture one story:

‘I visited a farmer who had survived suicide due to the valiant efforts of his neighbours. Owing a debt of Rp100’000, accumulated over 3 years for high farm inputs and unpayable because of failed crops. He had drunk pesticides, the tool of choice in this grim journey but been prevented from finishing his task. His neighbours cut down his bed, removing the legs and carried him 5 kms to the nearest road then flagged a truck to take him to hospital, where I interviewed him.’

‘Instead of being thankful for them saving him from death, he was raging at his neighbours…

How am I going to pay the hospital bill. After only 4 days in hospital I owe another Rp50,000, How am I going to pay this?’

Perhaps I have lost the power of the original storyteller but here lies the connection. A farmer with no choice, a refugee prepared to risk life for a better future perhaps?

Finally he turned to civil society and the role of the State reinforcing inequality and removing safety nets of the most marginalised. We have all heard complaints from the Right of erosion to our freedom of expression… Article 19 of the UN Declaration of Human Rights. He urged not to forget those following it, Articles 23 and 24, the right to organise, collective bargaining, decent work and employment and to earn a living wage. He suggested that Fair Trade should be a Human Right!

Solidarity with Farmers and Artisans from Nepal

IMG_6797Conference listened with great respect and appreciation to Chandra Prasad of Fairtrade Group Nepal, the umbrella for 9 WFTO members there. He spoke of the terrible human, infrastructural and cultural cost but demonstrated the networks capacity developed after 14 years. Members were organised and effective delivering relief to many outlying villages. Without fair trade beginnings within WFTO this group could not have responded so professionally.

Trade for Change

Carol Wills linked our present to WFTO’s organisational journey … the first global Fair Trade network to bring farmer and artisan organisations, the so called producers into a fair trade governance structure on equal footing to other stakeholders, and a critical voice at the table a decade before FI did so.

brandGeoff White Board member and NZ Trade Aid MD described ingredient branding with examples and reference to the commercial world. He asked us to understand the differing conceptual frames between certification approaches and their relationship with a business’s own brand. It helped visualise how the WFTO journey towards a Guarantee System offered a fundamental difference to the FI approach. An ‘augmented’ brand strategy reinforces strategic relationship with FT movement and differentiation based on values and commitment to movement, supports a price premium, compliments host brand marketing strategy, achieves regulatory acceptance and retains member exclusivity. It was music to my ears. How often had we heard Fairtrade doesn’t work for brands or reverts to ‘fairtrade/minimum price’

Safia Minney’s People Tree experience in developing their Guarantee System (GS) had uncovered problems in their value chain, assisted communication of FT principles within the chain and to external opinion leaders within the fashion industry. Through setting the agenda they were becoming a a rural production standard.

All WFTO members are now required to engage with and complete the new GS. Selyna Dulanjali from Selyn Exports in Sri Lanka described her engagement, as a social enterprise completing one of the first 9 pilots as ‘a sustainable system to manage our own adherence to the 9 principles of Fair Trade which we live by’. Not only that she wants to import the CIC (used by Liberation Foods) legal form to Sri Lanka

Perhaps this Guarantee system had not developed as far as I expected. Traceable cotton supplies for artisan producers of Fair Trade products remains a challenge due to the small scale of workshops. I resolved to learn more.

Workshops explored critical themes illustrated by member’s experience.

Craft retailing in specialist shops could be profitable according to the experience of TradeAid in NZ and Asha in India

Rain Morgan lead an exploration on Living Wages… a project that a WFTO working group had contributed to over the last couple of years. Immediate reaction was split by those worried about the cost of implementation but the majority saw the strategic importance of moving from a minimum wage standard. Before us lies an opportunity to position ourselves for the next few decades against the ills of our time and to move fair trade onwards, out of a tick box/balance sheet mentality, an audit paradigm, towards a theory of change, a staged journey of development against the flow, towards living wages.

The workshop put a resolution to the floor of the AGM and now WFTO will continue to integrate this work into its standards.

Deepening gender participation was not just an issue of justice but also critical to livelihood development. We heard from an ongoing WIEGO project in Africa and Latin America. Members demanded greater commitment towards gender empowerment both internally by members and to increase WFTO capacity to engage effectively on gender issues.

Recent years have seen both the destruction of local milk production and a decline in small scale farming across the developed world whilst the most marginalised sectors of society experience destruction of public safeguards and the monetary policy of austerity. Conference heard stories from Domestic Fair Trade across Europe and Latin America where solidarity trade was seen to be a new frontier. A wide range of local products were increasingly being sold in retail alongside those from the Global South. Participants both identified the risks of confusion and direct competition with traditional FT, dilution, and lack of clarity on levels of disadvantage and proposed that further work was needed to define this globally. But also saw the potential for defining a more holistic approach to a just economy and gateway to addressing issues such as climate change and food security which remained under the radar for most of FT. An exception was Ryan Zinn from Dr Bronner Soaps who described their project engagement on adaption to climate change. Across Europe especially, alliances were being forged with the Organic movement, Slow Food and social cooperatives. One commentator from Ecuador noted that our ‘legitimacy comes from inclusion’. This is surely a critical usp.

Unexpectedly a workshop on food certification revealed the depth of the farmers market movement in Brazil and Latin America. It was a joy and hidden gem to hear of chefs connecting with small scale farmers and local authorities supporting organic food markets.


In conclusion I realised that our work is more important than ever. Whilst I have missed a description of the keynote from Father Franz van der Hoff … you can by now find all of it online I hope. It’s message just as critical as 20 years ago. Now our job is both to reveal the invisible, that 70% of productive activity in the informal sector, the collateral damage from our governments neoliberal ideologies and to strengthen and expose successful alternatives through the creative collaboration our new business models engender. We must counter the dismissal of migration, the inhuman irrationality of ‘offshore solutions’ and marginalisation, demonstrating that we have inclusive solutions that can be scaled up to address the deep and necessary policy changes required resolve

Why are foodies turning their backs on Fairtrade: Part 1?

Small-holder walnut in shell

Is there is a growing critique of Fairtrade from the ‘foodie’ end of the market as was highlighted in the Guardian Development recently?

This is not the first time writers have explored this theme. The so-called ‘Direct Trade’ in the coffee industry, as also seen here in Australia, has had airings before, but what of ‘foodies’?

Rather than pose the disillusionment of foodies as a cause of the small fall in UK Fairtrade sales I would explore the opportunity that a growing foodie market represents and how it compliments a Fairtrade business strategy for small-holder farmers.

I suggest foodies have been around since well before Fairtrade grew to its current size. Certainly for the decade since I tried to sell Fairtrade certified products at Speciality Fine Food trade shows. For those that have never been, the sheer diversity and quality at these shows is mind boggling and for a foodie, it’s like being a kid in a toy shop. They are awesome fun but exhausting for the taste buds! Serr Walnuts from ChileWe struggled to find interest in high quality Fairtrade Darjeeling tea or fine Orange Blossom honey. We just couldn’t find UK customers willing to pay a premium for the world’s best walnuts grown by small holders in Chile.

The fact is, most speciality products are not widely distributed, selling through specialist retail or online so few get to supermarkets. Consumer trial and therefore the opportunity of developing scale will, for the most part, be small.

On the other hand, many such brands are the pride and joy of artisan food makers and growers too. The foodie market suits them well. Their food passion is unsurprisingly shared by foodie consumers. Very high quality cannot be mass produced, so it was common to see innovation, combining the feedback from market access, careful product development with the skills of farmers and growers on show at these Fairs each year.

In my experience smallholder farmers (even in developing countries) have always been good at responding to market exposure and they can easily acquire skills to grow amazing quality or taste. All it takes is that market access to begin with. In that sense, this is what the Workshop or Chef Roellinger is doing, providing the information and support for farmers to do better. However, and a critical difference, they neither have the intent nor the resources to develop transformational change at any scale, where the focus is on poverty alleviation, given the number of farmers that grow coffee or any other tropical crop and exist on precarious livelihoods. Product educationThis type of business development work is happening more and more in Fairtrade with the assistance of experts.

I believe if Fairtrade, had targeted it’s business strategy at this small specialist sector of the market 25 years ago it would have failed! We needed scale, both for impact but also to achieve competitive business costs and viable products. But several decades later, in a global billion dollar market, the time is now right for differentiation and we see ‘Direct Trade’ of high quality products and examples of foodie success in Fairtrade too. For instance Fairtrade company Zaytoun sells a wonderful freekah from small farms in Palestine. No doubt there are others, but even here, the cost of certification is prohibitive and for the farmer not the entire solution to better livelihood

Consumer foodies are naturally interested in the story of any product and its provenance so explored Fairtrade and its authenticity. So, many enthusiasts in the food trade also saw an opportunity to emulate the stories of traceability told by Fairtrade and told their own in similar terms. Even sometimes criticising Fairtrade to differentiate their own approach as a positive attribute, perhaps ideologically (not unusual here in Australia) or perhaps just from a business cost or quality perspective.

So what is happening to the foodie market (as the article rightly questions)? It is definitely growing and perhaps now fast outgrowing the ability of Fairtrade to deliver a range of high quality and interesting raw materials or finished products, especially in such a promiscuous category. By this I mean foodies get bored easily. They graze, moving on to the next tasty morsel for excitement! Whilst this is a fascinating aspect of consumer behaviour it is not a fundamental flaw in the Fairtrade paradigm. Of course a product can be ethical without being Fairtrade too! The key issue now is one of Fairtrade capacity to deliver. The same Annual Report highlighted the growing Fairtrade support from upmarket UK supermarket Waitrose; I hope Fairtrade can keep up with demand.

Both opportunities can complement each other providing a more secure livelihood for the small holder farmer. So let’s celebrate the skills and capacity of small scale farmers wherever they grow and whatever they grow. If you are a business, be ethical about product development and your terms of trade. If you want to use the complimentary certification, remember Fairtrade is fundamentally a tool to give market access to those who are marginalised.  If you are a consumer, enjoy your food but I would still urge you never to buy a Fairtrade product if you didn’t like the taste! That is the best feedback a farmer can get.

In the second part of this blog I’ll explore some of the Guardian article content in more detail.


Beyond Fair Trade premiums: Onam brings celebrations for farming families in Kerala

September brings the onset of Onam, the annual harvest festival, in Kerala, South India.IMG_2507

Small-holder farmers are celebrating this year. 4500 growers of cashew, coconut, coffee and spices amongst many crops, all very small scale (a couple of hectares), are collectively Fair Trade Alliance Kerala (FTAK). The alliance was formed in 2005, to address twin threats of farm debt and poverty both on the increase at that time and characterised in the extreme at times by the tragedy of farmer suicides.  Each year since then it gets stronger, a collaboration between farmers, promoters and consumers, defending the Kerala Development Model and using Fair Trade as a market tool to secure a strong sustainable business.

10666084_1489731467945805_4827038276676895373_nThe Onam celebration marks the annual distribution of price additional to the market. This year INR 11 million or $189,655 from cashew sales in to Fair Trade markets in Europe and USA.  Fairtrade premiums (certified by Fairtrade International) make up an additional INR 5 million.

This is the true inspiration. They are proud not just for the their own individual achievements as farming families managing the yearly risks but for that of the system as a whole and for all the cashew farmers of the region who have also indirectly benefitted from higher seasonal prices due to the associations strength and market share of the their supply chain. The security of a Fairtrade consumer market has added value to their crop and empowered many families.

Whilst you can read more about their Fairtrade story on the pages of the UK Fairtrade IMG_0296Foundation or on brands that sell their product such as Liberation CIC,  the wider farmer story is the one that goes on 365 days a year on their small homestead farms.

The glut of cashews collected at peak season gave power to processors who traded down prices well below cost of production as farmers became price takers. They had little choice and for some the stress was too much. Now with guaranteed contracts and pre-season finance flowing before harvest, FTAK and their supply chain partners can negotiate above market prices for the entire crop. Committed consumers are very happy to pay a small premium at retail to secure the deals.

Individual farmers in turn, trust the integrity of their Association and such is market share, local farm gate prices were estimated to be 30% higher at peak season. Now there are 40,000 small holder families farming cashews in the northern districts of Kerala producing between them around 30 million Kilograms of raw cashew nuts. The additional benefit the cashew farmers at large received because of the presence of FTAK intervening strategically in the market is about USD 0.30 per kg. This is an addition of nearly INR 450 million or USD 7.7 million in to the local economy this cashew season … just how much indirect benefit  is Fair Trade bringing!

Surely changing the paradigm like this is the true value and strength of Fair Trade when organisations leverage power beyond the personal bargaining of individuals to compete with businesses and bringing benefits to the many.IMG_2549

Empowerment has developed fast, their Fairtrade+3 policy is beginning to address the wider regional issues of biodiversity, gender equality and food security.  Also, having learnt that most value is accrued by businesses ahead of them in the chain, the farmers and their supporters now have confidence to launch their own brand into the BxT1NCyCMAAE_55Indian market, spearheaded by high quality organic coconut oil. What a fantastic example to farmers everywhere!


Dilmah’s Ethical Tea Society


I have just spent a fascinating morning researching Dilmah teas… after years in Fairtrade, setting up the Equal Exchange and cafedirect brand and tea supply chains, visiting Indian and Sri Lankan tea farms, I wondered what was behind Dilmah’s brand position ‘ethically produced tea packed at origin’.

I bought some tea, read the packaging and websites and researched a little background into the development of the Sri Lankan tea industry over the last few decades.

The Dilmah brand is now widely available in retail and food service, is good tea, but has no third party ethical certification or benchmark.

I am convinced that it is a private family firm with strong ethics and passionate philanthropic generosity. That said it is not Fairtrade or Fair Trade! On the one hand it is an entirely worthy private enterprise. On the other, as a good ethical example, it is not a model that is easily replicated to achieve transformative change for tea farmers generally, whatever the passion or belief of the owners or the impact to workers associated with that business.

A few facts first, then an exploration of the public statements from the Dilmah website.

What is Fairtrade?
•  What is Fairtrade in tea? The website is informative on general principles and standards.
• An interesting comparison of certifiers approach to tea from 2010 helps focus on the commodity.

An important difference , when considering the use of premiums, is the democratic decision making of workers from plantations This road to empowerment, this voice for the tea worker and opportunity for them to learn and become empowered in the business of tea does not exist in the Dilmah chain.

Who is Dilmah?
• A family owned tea company that is the 10th biggest global brand. Strictly it is part of the MJF Group
• Founded by Merrill Fernando in Sri Lanka during the 1970’s to challenge the commoditized tea industry, it took off as a brand in the 1980’s, with breakthrough selling tea to Coles in Australia. (I wonder who the buyer was!)
• Merrill has established the most integrated family tea business in the world ‘with ownership or investment in plantations, printing and packaging, tea broking, import & distribution of equipment & materials for the industry’
• The MJF Group also has interests in coconut, rubber and spices, real estate and the Sri Lankan leisure industry. It also imports tea processing machinery
• Dilmah is a large estate owner in Sri Lanka. As such it is the largest producer (one family) owned brand too, but only in the sense that the Fernando family owns the gardens. Brands such as Divine Chocolate, Cafedirect and Liberation CIC are all owned by small scale farmers who actually farm and own collectively.

The Dilmah website offers a thoughtful interaction with Fairtrade…


Why not join Fairtrade?


  • Value is in the brand and packaging with all the product blend knowledge that goes with it. Correct
  • Dilmah equates vertical integration of its business model to control the chain from grower to market as ‘Fair’. I would advocate this model as common sense as it develops many skills at origin. Opinion
  • Removal of middlemen: Fairtrade does not claim to cut out middlemen in the tea chain, especially if the tea comes from plantations or estates. Standards are focused on the workers or small holders. This strategy achieves market penetration faster as this is where the traded volumes are. Communication
  • Removal of middle men: This is true in a vertically integrated chain by definition. Other brands are also vertically integrated e.g. Tata’s Tetley Tea but do not claim fairness. The majority of teas still follow the conventional brokerage model. Due to the economy of scale and power of the large entities they offer most advantage as it is difficult to enter those markets. Dilmah has been successful developing a brand selling good quality Sri Lankan tea. This does not work as well in the UK, where the consumer preference is for a stronger East African dominated blend. Communication spin
  • Price paid to workers under Fairtrade certification is governed by national labour standards. Tea workers in India are paid according to regular negotiations between trade unions and government too, predicated under the 1948 Plantation Labour Act. Equivalent to Dilmah
  • Tea prices under Fairtrade standards are subject to a minimum price and a premium defined by origin and grade of tea. Fact
  • Sri-Lankan teabag grades of orthodox teas suitable for teabags (fannings or dust) have a minimum price of $2.40/kg FOB. (East African teas $1.60/kg FOB)
  • Fairtrade pays premiums to worker premium committees and Dilmah pays to MJF Charitable Foundation. Teabag grades of orthodox teas suitable for teabags (fannings or dust) attract a Fairtrade premium of 50 cents per kg. The MJF is governed by members and staff of the Merrill Fernando family and several non-execs drawn from accounting and business backgrounds in Sri Lanka.
  • The Fairtrade premium paid to Sri-Lankan premium committees is worth about 20% more than the price of made tea. Dilmah makes donations of > 10% on packed tea products. Whilst we are not party to the actual packed cost per kg it is safe to say it is probably more than 50 cents…. Does anyone know the estimated cost?
  • Through his Mankada based MJF Charitable Foundation, an NGO and recognized Charity, Merrill Fernando distributes much of his wealth to his staff & workers and to underprivileged persons in Sri Lanka. The Foundation’s key objectives include the improvement of medical and educational facilities for over 30,000 workers and their families on MJF Group plantations, and the approximately 1,500 staff and workers in its trading and production activities. A good model for private business. Nothing wrong with philanthropy.


Views on Fairtrade and sourcing
The first Fairtrade certified teas came from Darjeeling and the Nilgiri Hills in India in 1994 (20 years ago)  Fact

• The tea industry supplying UK has moved towards sourcing from both estates and very large farmer associations in Kenya, Tanzania and Uganda over the last 30-40 years. This production is called CTC tea (Cut, Tear and Curl) made in larger factories and also common in India. Sri Lankan tea comes mainly from estates and is sold predominantly to Mid-East and Russia/Central Asian markets with higher quality Orthodox processed still strong in the US and Australian markets. The cost of tea is strongly influenced by wage costs which are relatively higher in SL than India and EA. It was a new business strategy for South Asian firms to enter the tea market as brands as and manufacturers given that margins were so low in the brokering of tea. This strategy is now common in Sri Lanka with over 30% sold this way.

  • It is impossible to find out how much of Dilmah’s tea comes from their own plantations and how much (if any) is sourced from the national market.   Query

Much of the UK supermarket tea is also sourced from tea estates in India owned by the Bombay Burmah company. It has proven very difficult for smaller companies to break in due to the economies of scale. This demonstrates the competitive difficulty Dilmah faced.  Fact

• Many Sri-Lankans are still small-scale farmers. Some grow tea. Most of these are outside the export economy.
The tea sectors in India and Sri Lanka have moved away from estates (where tea is grow and processed) to small farmers (processed in independent factories without the mandatory social requirements).
The area of tea grown by large and small farms is approximately equal after a huge change away from estates over the last 30 years. This development makes tea cheaper to produce but relies on large numbers of small scale family farms outside the wage economy
Merrill will have faced this trend of declining profitability in his estate business when choosing a business strategy after buying estates in 1971.  Facts

• An Oxfam-Novib study on tea wages in India estimates the ‘in-kind’ services and benefits worth an additional 75% value over the national minimum wage. The inclusions of this are broadly similar to those in Sri Lanka.  Facts

Other critiques
New Zealand fair trade company Trade Aid criticised Dilmah publically ( I could find no record of the article in the NZ Herald) in 2008, eliciting the following response from Dilhan Fernando one of the founders sons and now CEO, on their own blog site

All of this rather confirms my view that Dilmah has achieved significant commercial success as a branded product picked and packed in Sri Lanka. It’s ethical position is certainly very strong for a private company buying from plantations. Because part/all of the tea comes from within the group and there is no third party scrutiny, it is difficult to say absolutely that all is well. However if you want good quality ethical Sri Lankan tea, Dilmah is probably a good bet. I did enjoy the tea! If you want to support small holders, if you want independent scrutiny and want to critique the wider world of trade, choose a Fairtrade certified brand but also knowing that it’s value added is very likely to remain outside Sri Lanka or the producing country.

Having said that both organic and Fairtrade certified teas in my store cupboard are packed in Sri Lanka! Natures Cuppa Ceylon comes from ‘our plantations’… that’s interesting and Oxfam Premium Earl Grey from SOFA small farmers.

Finally, I was left thinking about the similarities and differences between the Fernandos and the Mohan family who set up Tea Promoters India to renovate Darjeeling estates which had been model gardens for the first Fairtrade tea standards, yet who had remained small scale plantation owners and tea makers and promoters of small farmer development too. Perhaps that’s another story.

Coffee Rust: La Roya threatens coffee farmers in Latin America


The Coffee Rust fungus is devastating coffee production across Latin America. In many areas such as Peru, production is down by 75%. Climate change is a major contributor has been widely reported (Video).

As most coffee is grown on tiny family acreages this crisis is increasing poverty amongst those with least resilience.

Yet again, it is interesting how opinions become polarised once Fair Trade is mentioned as part of any sustainability solution once dialogue starts on forums. This is a shame as there is much practical experience to learn from all sides. In my experience there are farmers affected by La Roya supplying a bit of their coffee Fairtrade (FT) certified via coops and many many more unable to sell as the market is too small. The dominant tradition is Free Trade, not Fairtrade, nor Direct trade, nor any other cheaper certification. For those lucky enough to have a FT contract it does not offer a solution to La Roya any more than a Free Trade one. Premiums are just too small as it takes seasons to address the issue. 

That debate about effectiveness is therefore about one’s business philosophy. Whether one’s business is small, entrepreneurial, unprepared to have third party scrutiny and unaccountable or large and needing a cost effective CSR programme to field company ‘ethicality’ to shareholders. Either way the issue is systemic. Farmers are rarely powerful intermediaries in the coffee trade, an ocean of sharks few understand and even fewer have the skills and resources to influence, which is only too willing to exploit weaker players. Fairtrade, for all its faults at least gives consumers some insight and some control on the outcomes however imperfect and is at last redressing the balance. Small-scale coffee farmers begin to have a voice.

Most coops are unable to sell anything like enough certified FT to provide enough reinvestment to combat the fungus. Equally, so-called ‘direct’ trade offers such small purchase volumes to specific farms and does not get coverage nor offer down side security. Consumers have no idea who to trust and who is making it up as they go. The real issue for farmers is the trade itself, pushing prices lower for competitive advantage, whether for certified or uncertified coffee. This can happen in any coffee transaction.

FT has no power to adjudicate or influence the transaction when it is above the COP. It would be most interesting for consumers to have transparency on the price /quality/volume equation. A real choice could then be made.

Fairtrade International (who set global standards) remains the only third party certification system that farmers actually have an equal stake in governance, strategy and standards development. As such it can be promoted as part of coffee farmer’s strategy to secure more of the value chain.

Free Trade is in general unable to provide an element of price security that a well-functioning coop can offer when prices fall as supply increases. Unlike Fairtrade, it cannot offer finance for coops to make critical early harvest purchases, which makes farmers price setters. Fairtrade on the other hand can also provide many examples of coop good practice and re-investment. But as a third party certifier, it does not control the transaction between buyer and seller, only certify and there are good and bad coops just as there are good and bad farmers. Most small scale farmers therefore use coops/certification as a price risk strategy, exploiting any upside by selling outside it and utilising it more when there is a perceived downside.

No doubt some excellent coffee is shipped from a few family farms via so called ‘Direct’ trade businesses. Whilst certified Fairtrade was created over 25 years ago by companies doing ‘Direct’ trade, there is now a new wave that does not buy into the values of those pioneers. ‘Direct’ has become a marketing term meaning ‘fairer than fair’ to position the new wave within the customer base created by Fairtrade. However, ‘Direct’ trade by definition has no middle men when really ‘walking the talk’. Few individuals are prepared to finance all the value-chain steps to sustain this at scale though, cherry-picking a few bags of fine coffee and leaving the farmer to market the lower grades. Fewer still are owned (like coops) by the coffee farmers and able to offer a range of services. By definition, they are small businesses which see any additional cost, especially that of independent third party scrutiny as a burden to competing.

The scale challenge remains and investment is needed to create climate resilience for small scale coffee farmers. Once the ‘Direct’ traders can sell thousands of tonnes of Fairtrade coffee, like British companies cafedirect and Twin Trading who also have farmers on their Boards, consumers, perhaps sipping a fabulous ‘Geisha’ coffee can make their ethical choice accordingly, knowing that perhaps, they are creating resilience to coffee rust too!

Science, knowledge and wisdom

When I was still at home in Norwich, a teenager I guess, I read loads of science fiction. Everything I could get my hands on came through the local library run by the Council. I was allowed 2 books’ then 4 as I passed some age, possibly 11, and was allowed into the adult section. The comprehensive school ran a book club, from which I bought one paperback every month. I can’t say my choices ran to classic literature or the moderns of that time, but the occasional sci-fi still featured. I feel sure the library and the club have gone now…

A few of my favourite Isaac Asimov novels (perhaps the Foundation series written in the early 1950s) survived post university clear-outs, sitting yellowed on the bedroom bookshelf until Mum moved to Edinburgh and we sold the house.

He was a professor of biochemistry at Boston but became an educator too and was a great populariser of science during the 1960s… he must have influenced me more than I realise.

I recently came across this quote from him writing in Newsweek (1980, January 21) in the cusp of America’s shift into the Reagan era of conservatism, he declared the U.S. “a cult of ignorance,”

“Anti-intellectualism has been a constant thread winding its way through our political and cultural life, nurtured by the false notion that democracy means that ‘my ignorance is just as good as your knowledge.’”

The thread has developed in the decades since then. As I listen to the disrespect dished out in public by some of our politicians in the name of free-speech, I am more than ever convinced of the need for evidence, wisdom and transparency .

And then, with particular current observation of the denialists debating climate science, as if it were built on a hypothesis developed in a pub. It all began centuries ago with patient experimentation and theory. As Asimov also reflected, and relating to a questioning mentality that has been with me all my life:

“The most exciting phrase to hear in science, the one that heralds the most discoveries, is not “Eureka!” (I found it!) but ‘That’s funny…”

I always felt an answer generated another question… even if the discovery had generated a high degree of certainty proving a hypothesis.

Finally, again written a while back, but still true, what we do with the science is up to our collective wisdom.  How do we make decisions about opportunity and threat?

“The saddest aspect of life right now is that science gathers knowledge faster than society gathers wisdom.”

Which perhaps leads us to values and ethics to guide our that wisdom.