13. Coffee for $0.23/kilo?


Black GoldI watched a documentary film tonight called Black Gold. It’s about coffee. I love coffee. And I started to buy fair trade coffee a few months ago, not really aware of all of the issues, but aware that there is a problem between the price the farmer gets and the price that we pay. “A problem” doesn’t nearly touch on the magnitude of the issue.

The did a little math in the film, with the coffee farmers in Ethiopia(members of the Oromia Coffee Farmers Cooperative Union). A cup of coffee sells for $2.90 (USD) on average in the western world. There are about 80 cups of coffee in a kilo. Which puts the price at $230/kilo. And the Ethiopian coffee farmer gets $0.23/kilo. Yeah, that’s right, TWENTY-THREE CENTS. Now, even if you talk about the price of a pound (2.2 lbs in a kg) of coffee that you don’t buy off of a retailer like Starbucks or whomever it is you choose to rip you off (and the coffee growers), it’s still insane. Even if you factor in travel costs and roasting costs, it’s still insane and inhumane and completely unfair. And one of the farmers suggested a price that would “change our lives beyond recognition” – that price: $0.57/kg. He lives with 15 other people under his roof and can’t send his kids or grandkids to school because of poverty. They don’t want to be rich and drive fancy cars and buy iPhones and giant flat screen TVs. They just want to feed their families and put shoes on their feet and send them to school (if they could afford to build a local school).

How did it get to this point? Well, there was talk of the International Coffee Agreement, which fell apart in 1989, leading to the 30 year low coffee price there is now. The coffee price is set by the New York futures market, which doesn’t have the farmers best interests in mind (surprise, surprise). For instance, it costs $0.90/kg to produce coffee in South America and New York pays them $0.63/kg. Wait a minute, they’re LOSING 27 cents for every kilo they produce? Yeah, that’s right. Then there’s the subsidies that western countries give our farmers, while African countries don’t have money to give their farmers subsidies, and therefore they can’t compete. And there’s a shedload of middlemen in the industry, but really, the coffee grower gets 1-3% of the profits, the shippers, exporters and local traders 7%, and the retailers/cafes, roasters and importers 90%.  There’s a good article on coffee at globalexchange.org if you’re interested in reading it. Or see the film. Or do both.

So… it’s fair trade coffee all the way for me now. By the way, great film. I highly recommend it.


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