Certifications

Fair and Direct Trade

Sips: Fair Trade debate

There are so many great voices in the fair/Fair trade movement, I keep out of it aside from environmental aspects of certification and occasional links. Here are a few of those links to some posts I have found most thought-provoking lately. Fair Trade is having growing pains, and recent high market prices for coffee have added to the turmoil.

The Stanford Social Innovation Review is a publication of the Center on Philanthropy and Civil Society at Stanford University. They recently ran two pieces on Fair Trade. The first, is The Problem with Fair Trade Coffee, by Colleen Haight, an assistant professor at San Jose State University. About a third of the way down is a good illustration of the author’s interpretation of why Fair Trade coffee has a “quality problem.” Lots of history and stats in the piece, and excellent comments, as well.

They followed up with a rebuttal from Fair Trade USA head Paul Rice, Fair Trade: A Model for Sustainable Development.

Meanwhile, Small Farmers. Big Change the blog of Equal Exchange, an alternative trade organization, also put out two pieces. Fair Trade is NOT the End Goal: Part I and Part II. Part I explained the pressures on co-ops during periods of uncertain high market prices, and the choices they face when it is time to deliver on pre-negotiated contracts which will pay less than the market price. One passage struck me,

When the coffee starts coming in, the competition (in the form of multi-national businesses) is knocking at the farm gates offering farmers more money for their beans than the price the co-op has promised them.

I added the emphasis. I suppose anybody could come along and offer higher prices at the farm gate, but look who is specifically singled out* as the entity who is trying to get  farmers to break their contracts with their co-ops: corporate coffee. As the post explains, this far-reaching problems. And those multinationals won’t be at the farm gate when prices drop again.

Part II is a view of the future of Fair Trade by Santiago Paz, co-manager, CEPICAFE, a co-op in Peru.

Food for thought.

*Update: A Wall Street Journal article, “Battle brewing over coffee” published on 17 July confirmed it is the “cash flush” multinationals tempting the farmers. The first sentence reads, “Rising prices have upended the coffee trade, as multinational brokers increasingly woo farmers away from local cooperatives in the world-wide scramble for beans.” It specifically mentioned these are representatives from  Nestlé SA,  ED&F Man Holdings Ltd.,  and Ecom Agroindustrial Corp. Ltd. The latter two are very large organizations that include coffee divisions (ED&F Man’s is Volcafe) that buy coffee for multinational roasters. These companies say that it’s up to the farmers who to sell to.

That’s true, and I can’t really blame the farmers, who need the cash. But these multinationals won’t be providing loans and support when coffee prices drop, and if the cooperatives go under, nobody will.

Maybe these high prices wouldn’t be as tempting if we’d been paying the real cost of coffee all along, providing a price that reflects all the work that goes into growing coffee, and enough for farmers to cover their costs of production and feed their families, send their kids to school, and invest in their farms and communities.

There is no such thing as cheap coffee.

Update #2: Fairtrade International (FLO) has been holding workshops on risk management and contract negotiation for cooperative managers to help them with the problems surrounding defaults on their contracts. FLO reports that Bolivia, Peru and Indonesia were the countries hit hardest by co-op member defaults. Read more here.

Photo by Ian Murchison under a Creative Commons license.

Certifications / Data summary tables

Eco-certified coffee: How much is there?

Latest update March 2021

When sales and market shares of various certified coffees come out, I try to put them together in a post. Each certification scheme tends to announce them at different times of the year, and provides slightly different data. I’ve decided to put the most salient data together in a table for four of the main coffee certifications with environmental criteria, plus Starbucks CAFE Standards (a third-party verified set of supplier standards), with past data for reference. I’ve standardized the unit to metric tons for easy comparison. Links on the year go to source information, which usually has more detail.

For a little perspective, world production in 2018 was about 10.4 million metric tons, and the U.S. imports around 1.5 to 1.6 million metric tons of coffee a year.  With the recent lowering of the environmental standards of Rainforest Alliance (merged with Utz as of 2018), only the only real benchmark we have of certified truly eco-friendly coffee is Smithsonian Bird-Friendly; this coffee must also be certified organic. Certified organic coffee comprises less than 10% of the global market (see note 3).

Hectares
certified		 Production
(metric tons)		 Sales in metric tons
(% of production)1
Smithsonian
Bird-Friendly		 2008: 5000
2010: 7600
2012: 8650
2014: 5544
2018: 12,800		 2006: 3600
2008: 2700
2010: 4400
2012: 4735
2014: 3524
2018: 8620		 2006: 200 (5.5%)
2010: 206 (4.7%)
2014: ~325 (9.0%)
Rainforest Alliance2 2007: 200,000
2009: 305,383
2012: 323,500
2014: 360,000
2016: 387,000
2017: 411,519
2018: 470,841
2019: 470,611		 2006: 27,152
2007: 41,494
2008: 123,766
2009: 168,114
2010: 219,337
2011: 245,000
2012: 375,000
2013: 454,962
2014: 458,058
2016: 509,000
2017: 557,911
2018: 655,314
2019: 669,698		 2008: 62,296 (50%)
2009: 67,583 (40%)
2010: 114,884 (52%)
2011: 129,864 (53%)
2013: 133,000 (37%)
2017: 289,485 (52%)
2018: 328,082 (50%)
2019: 393,550 (59%)
Organic3 2007: 546,541
2008: 463,500
2009: 560,368
2010: 642,833
2011: 534,392
2014: 762,916
2016: 882,000
2017: 849,675		 2008: 195,782
2009: 204,606
2010: 230,819
2011: 248,767
2013: 248,000
2016: 447,000
2017: 370,000		 2006: 30,000
2007: 38,000
2008: 117,560 (60%)
2009: 112,900 (55%)
2010: 117,960 (51%)
2011: 133,163 (53%)
2013: 133,000 (53%)
2017: 160,000 (43%)
Starbucks CAFE Practices4 20105: ~435,000 Same as sales,
see note 4		 2007: 103,000
2008: 134,000
2009: 136,000
2010: 103,000
2011: 166,468
2012: 230,878
2013: 171,004
2014: 199,696
2015: 249,929
2017: 285,000
2018: ~294,000
2019: 310,000
UTZ Certified6 2006: 163,300
2010: 320,308
2011: 348,086
2012: 508,661
2013:473,953
2014: 473,953
2015: 476,953
2017: 592,977
2018: 770,423
2019: 720,250		 2006: 108,500
2007: 218,358
2008: 308,464
2009: 365,010
2010: 394,003
2011: 476,903
2012: 715,648
2013: 726,591
2014: 729,918
2015: 821,399
2017: 857,803
2018: 1,102,826
2019: 1,083,649		 2006: 36,000 (33%)
2007: 53,000 (24%)
2008: 77,478 (25%)
2009: 81,367 (22%)
2010: 120,994 (31%)
2011: 136,752 (28%)
2012: 188,096 (26%)
2013: 224,028 (31%)
2014: 258,867 (35%)
2015: 238,394 (29%)
2017: 365,091 (42%)
2018: 518,807 (47%)
2019: 589,522 (54%)

1 Not all coffee produced under certification criteria is sold as certified. For example, for convenience producers may sell their certified coffee “at the farm gate” to local traders rather than transport it through the supply chain per certification rules. The coffee can’t be sold as certified.

2 Generally, Rainforest Alliance figures come from their press releases.  2017-2019 data came from their Coffee Certification Data Report 2019. Hectares certified is for production area certified, not the total area of certified farms, which can include buildings, etc. and  is often a much larger figure. For example, in 2016, RA stated that coffee farmers safeguarded the health of 945,000 hectares, but showed production hectares as approximately 360,000.

3 Organic coffee statistics are not centrally aggregated and notoriously hard to parse. Figures on total land in organic coffee often come from The World of Organic Agriculture yearbooks based on research by the Research Institute of Organic Agriculture (FiBL). 2017 data from State of Sustainable Markets 2019.

4 Starbucks regularly publishes updates to their ethical coffee sourcing program on their web site. The figures here for production and sales are identical as they include only CAFE Practices sourced coffee.

5 Land area is extrapolated from data in 2011 Ethical Sourcing Factsheet stating that at least 102,000 ha are set aside for conservation on Starbucks’ suppliers farms, and that represents about 23% of total area verified under CAFE Practices. Figures for sales for Starbucks are actually purchases by the company under this program.

6 UTZ and Rainforest Alliance agreed to merge in 2017 and retain the Rainforest Alliance name. 2017-2019 data came from the Coffee Certification Data Report 2019 which retained figures from both certifications. After 2021 data should reflect coffee all under one umbrella. Older UTZ accomplishments and data are gleaned from past annual reports. Prior to 2017, at least, UTZ figures for sales are actually the amount of certified coffee purchased by the first buyer. The amount of coffee sold as UTZ certified is slightly lower.  UTZ and Rainforest Alliance merged in 2018.

Certifications / Rainforest Alliance

Rainforest Alliance to require upping the ante

A frequently heard complaint about Rainforest Alliance is that they allow their seal on coffee that contains as little as 30% RA-certified beans. I understand RA’s rationale: that for a very large roaster to source 30% of many tons of coffee has an arguably larger impact than a small company sourcing 100% of a half ton, and allowing less-than-total content gets big corporations to the table. But while the percentage of certified content has to be specified on the label, many consumers, roasters, and coffee professionals I’ve talked to think that the ”30% rule” tarnishes a great certification, confuses or misleads consumers, and indicates too much concession to corporate interests.

The mantra from RA has always been that these “30 percenters” must continue to increase the amount they source. For instance, the RA blog says, “We are committed to ensuring that companies scale up their commitments… If a mainstream brand begins … by sourcing, say, 40 percent of its coffee from certified farms, that brand must agree to source increasing quantities from certified farms as they become available.”

Alas, that does not seem to have happened in practice, with the most glaring example being Kraft’s Yuban coffee, still at 30% since it began using RA beans in 2006. (A very notable exception is Caribou Coffee, which has increased the number of offerings that include RA certified beans and the percentage in those offerings. In 2006, their stated goal was having every one of their coffees 100% RA certified by the end of 2011; they are currently on track to meet the goal.)

The problem has been, apparently, that the actual rules do not seem to be specific enough. RA’s “Use of Seal” Guidelines dated December 2007 states that “Companies requesting to use the RAC seal on single-ingredient products with less than 90% certified content should also agree to a SmartSourceTM plan: a step-wise approach to scaling up the percentage of certified content over time with specific benchmarks and timelines along the path of sustainability.”

This is due to change with the next update of the Use of Seal Guidelines. Any company that offers a coffee that does not contain 100% certified beans will be required to scale up the amount at least 15% a year until the content reaches 100% certified beans. I thought this might mean 15% of the current certified content per year (e.g., from 30% to 34.5% to 39.7%, etc.), at which rate Yuban would not be 100% until I was past retirement age in 2020 or so. However, I confirmed with Alex Morgan, RA’s U.S. Manager of Sustainable Agriculture, that this meant 15% of 100 (30% to 45%, etc.).  This is a significant, meaningful, and important milestone, in my opinion.

This rule will apply not just to coffee, but other products using the seal, such as cocoa. Thus it is taking awhile to implement to accommodate varying production methods associated with different products, but the update should take place sooner rather than later. It’s my understanding not every partner is thrilled with this change, and it will be interesting to see if anybody drops the certification. My guess is that it would be pretty awkward for a player like Kraft to quit Rainforest Alliance after touting their involvement for years. We will see which big companies are actually committed to sustainable sourcing, and which may have been using RA certification to greenwash via token sourcing.

Coffee awards and competitions / Rainforest Alliance

Rainforest Alliance Cupping for Quality – April 2011

As promised in the last post, here are the winners of the Rainforest Alliance Cupping for Quality awards from the April 2011 cuppings, which covers countries in Latin America, Ethiopia, and India. The award is designed to recognize exceptional coffees carrying the Rainforest Alliance seal and to highlight the linkage between sustainable farm management practices and cup quality.

In the April cupping, 76 coffees from 10 origins competed. Aside from the origins of the top ten winners noted below, the other competing countries were Nicaragua, Costa Rica, and the Dominican Republic.

  1. Aguadas Rainforest Group (Alegrias, El Diamante, Villahermosa), Colombia (89.00). Located in the Andean rainforest in northern Colombia, the group has over 1800 ha under certification, at 2100 m.
  2. Sidama Coffee Farmers Cooperative Union, Ethiopia (86.79). Also Fair Trade.
  3. El Diviso, Colombia (86.46). Near TimanÁ¡, Huila at 1550 to 1700 m.
  4. COMICAOL, Honduras (86.07). A cooperative out of El ParaÁ­so, growing at 900 tp 1500 m.
  5. Santa Teresa, El Salvador (85.71). A rather well known estate located in the Apaneca-Ilamatepec region, near Ahuachapan, part of the Cofinanzas Estates. Also produces Smithsonian Bird-Friendly certified coffee from its certified organic crop.
  6. Jumboor Estate, Tata Coffee Ltd., India (85.50). Tata is a very large company running multiple farms. Jumboor is in northern Coorg (which is in southern India), growing S795 (which has Kents variety in its background) and HDT x catuai on 370 ha at 915 m.
  7. Finca Kassandra, Mexico (85.46). In central Veracruz, at 1200 to 1500 m.
  8. El Guayabito, Catalina, Los Naranjos, San Antonio, Colombia (85.36).
  9. Finca el Zapote, Guatemala (85.35).
  10. ADESC, Guatemala (85.29).

Congratulations to all the participating certified farms.