The Brawl Over Fair Trade Coffee
For a long time, Rice has felt constrained by the rules of the global fair trade system. At a conference in Boston in 2003, he was booed for suggesting that plantations should be incorporated into fair trade. He believes the current model is antiquated and inefficient, and that opening the sector to corporations will usher in a rising tide that will lift all boats. “We’re all debating what do we want fair trade to be as it grows up,” Rice told William Neuman of the New York Times in November. “Do we want it to be small and pure or do we want it to be fair trade for all?” “For Paul, it’s all about volume,” says Jonathan Rosenthal. “And that means getting the big guys on board.”
It’s a strategy that raises many questions and warrants close scrutiny. Owing to the limited global market for fair trade coffee (which accounts for about 4 percent of coffee exports to developed nations), the 360 farmer cooperatives sell only a portion of their crops—estimates range from 30 to 35 percent—to fair trade networks; the rest is sold to commercial networks at commercial rates. In my interview with Rice, I asked him why he wasn’t focused on perfecting the current system—which would mean bolstering the farmer co-ops by raising the percentage of coffee they sell to the more equitable fair trade networks—instead of bringing in new supply networks from plantations and small farmers.
Rice’s response was that large coffee companies are determined to mix beans from plantations and fair trade farmer cooperatives in order to label the resulting blend “fair trade.” In order to do so, plantations (Rice prefers the term “estates”) must be brought into the fair trade system through the back door by certifiers like Fair Trade USA—which, since its break from Fairtrade International, is free to do as it wishes. Explains Rice: “The fair trade default response to this was, ‘Can’t you just take the estate coffee out and replace it with co-op coffee?’ Well, that, my friend, is the height of arrogance.” Arrogance toward whom? Toward the professional roastmasters at the major coffee companies: “They’re like alchemists, and they are masters of their universe,” says Rice. “No one tells them how to put together the perfect French roast.” Rice poses a question: Should a roastmaster “listen to some NGO dude who tells him to rejigger his business and re-engineer his blends? No.”
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The response from the fair trade activist community has been fast and furious. Equal Exchange has been at the forefront of the charge, in ways both strategic and pedagogical. The company’s full-page ad in the Burlington Free Press, which urged Green Mountain to stop doing business with FTUSA, was a quixotic attempt to deprive Rice of his biggest customer. Equal Exchange says Green Mountain is FTUSA’s “largest single source of revenue and a critical pillar of support.” (A Green Mountain spokesperson told me that the company will maintain its ties to FTUSA.) Equal Exchange is also circulating a petition in support of “authentic fair trade,” which at press time had garnered more than 8,000 signatures and backing from 550 organizations. (Like many in the fair trade activist community, Equal Exchange is worried that consumers will be misled by a “fair trade” seal that masks corporate involvement; hence its desire to highlight farmer co-ops.) Meanwhile, Rice is circulating his own petition in support of his initiative, which is called “Fair Trade for All”; signers include John Mackey, the CEO of Whole Foods, and Arturo Rodriguez, president of the United Farm Workers of America.
Much of the anger directed at Rice emanates from his unilateral decision to exit the global fair trade system, which prides itself on its democratic, inclusive structure and its historical roots on the left. Indeed, fair trade producers will soon occupy half the seats on Fairtrade International’s rulemaking general assembly. (Rice’s split with the parent organization has been messy: Fairtrade International claims that FTUSA still owes $1 million in membership fees; Mary Jo Cook, chief impact officer of FTUSA, says the fees were too high and that “our fees for 2011 are still under discussion.”)
Rice’s critics say they were taken by surprise when FTUSA left the parent organization: Merling Preza, who helped to found PRODECOOP along with Rice, told Coffeelands blogger Michael Sheridan, “It hit us like a bucket of cold water.” Says Matt Earley, co-founder of the cooperatively owned wholesaler Just Coffee in Madison, Wisconsin: “The way that FTUSA did it was absolutely undemocratic, and it just flies in the face of what we all consider a broader fair trade movement.”
For Rice’s critics, extending certification to plantations and small farmers is tantamount to a betrayal of core principles. “Cooperatives cannot compete with plantations on the economy of scale,” says Earley. “They can’t compete with them in terms of what they are paying their workforces.”
Rice insists that he cares deeply about the fate of the 360 farmer cooperatives. “I am not going to be the guy who abandoned co-ops,” he told Sheridan. Rice’s effort to expand the fair trade model is currently limited to three pilot projects—two of which, in Colombia and Costa Rica, involve small farmers who are not in cooperatives, while the third, in Minas Gerais, Brazil, involves an estate. Rice is quick to defend that estate, Fazenda Nossa Senhora de Fatima, which has between seventy-five and 110 workers on 568 acres. “It has two amazing owners who are pioneers of organics,” he says. “Those owners have demonstrated a deep commitment to sustainability and to their workers. Fazenda is a natural fit for us.” (Rice is planning other pilot projects as well.)
Moreover, Rice has rolled out a proposal to protect at least some of the co-ops that could suffer under an expanded system that includes corporations and plantations. It’s called Co-op Link, and the goal, he says, is to fortify some of the larger cooperatives—the ones that are likely to sell beans to Green Mountain, Starbucks and Costco. Several of these projects are under way in Latin America, Africa and Asia, and over the past five years, Rice has assembled powerful institutional actors to co-sponsor them: the US Agency for International Development, the Clinton Global Initiative, the Kellogg Foundation, the World Bank and Walmart. But what about the 300-plus farmer co-ops that are not a part of his Co-op Link scheme? Rice doesn’t say, though he admits that many of them are in precarious shape.