No Middle Ground in the Coffee Crisis?

Valley Advocate
by Andrew Varnon
October 09, 2003

Dean Cycon, of Dean's Beans in Orange, says he "hate(s) to be the one to spill the beans on Paul Newman," but there he goes. In an advertisement, little-guy roaster Dean is taking Paul Newman and his Newman's Own Organics label to task for a good cause: the coffee growers of the world who are being driven out of business by coffee prices that recently hit a 30-year low.

Now, Dean isn't trying to make Paul into the bad guy here, or so he says. Rather, he's trying to push the socially-conscious movie star into taking a stronger stance for an idea that Dean holds dear: fair trade organic coffee.

Perhaps unbeknownst to the average coffee drinker in the United States, the worldwide "baseline" price paid to coffee growers for their harvest -- which had hovered around $1.20 a pound in the 1980s -- has plummeted in the past three years to currently around 50 cents a pound.

In the third world, it's a crisis of dust bowl proportions. Coffee plantations in Latin America are being abandoned as growers and workers find that the beans cost more to grow than the price they can expect to get for them. The International Coffee Organization estimates that 25 million families around the world depend on coffee, at least in part, for their livelihood.

But while disenfranchised Mexican coffee farmers have died trying to cross the border into the United States, the coffee crisis hasn't affected the price of a cappuccino here at home. That's because only about 2 percent of the price of a cup of coffee in a coffee shop goes to the farmers, according to the ICO.

That's where the idea of fair trade coffee comes in. Under the system monitored by Fairtrade Labeling Organizations International, participating coffee sellers purchase their coffee through registered farmer cooperatives at a price that is agreed to provide a living wage. Currently, that price is $1.26 a pound for conventional coffee and $1.41 for organic coffee.

The sellers then can label their coffee as "fair trade" so consumers know that the farmers who grew the beans were paid a premium price. Even Procter & Gamble and Dunkin' Donuts have jumped on the bandwagon, promising to introduce fair trade coffees into their offerings. But most companies don't convert wholesale to buying fair trade beans -- Dean's Beans is one of only a handful of roasters that TransFair USA lists as selling exclusively fair trade coffee.

So our boy Dean pops off a full-page advertisement that ran this past month in a feisty new 'zine called Arthur that claims national distribution in coffeehouses, CD stores and bookstores.

Dean's argument is this: Newman's Own Organics (an offshoot of Newman's Own co-run by Paul's daughter Nell and her business partner Peter Meehan) places its socially responsible label on a line of coffees roasted by Green Mountain Coffee Roasters. This line of coffees is 100 percent fair trade certified and organic. Dean likes that, because he is 100 percent fair trade organic, too. Only thing is, Green Mountain is not -- about 10 percent of the coffee Green Mountain roasts is fair trade certified, according to the company's website.

Dean says, how can you tell one farmer that you'll pay him a negotiated "fair" price and the other nine that, sorry, they're out of luck? "It's really an ethical choice," he said. "The profit is there in all that coffee. Three years ago, we were paying $1.70 for that coffee on the ordinary, conventional market... Now, we're paying $1.41 for fair trade organic coffee."

So his challenge to the Newmans is: put pressure on Green Mountain to roast more fair trade beans, or find a roaster that's 100 percent fair trade.

To Nell Newman, that's niggling. Green Mountain has the national distribution that she needs and moreover, by going with Green Mountain, she is pushing them to roast more Fair Trade Coffee.

"I don't really see the point in needling or finger-pointing," she said.

So, in a sense, this is a battle of ideological purity. Green Mountain is not Maxwell House. The Waterbury, Vt.-based roaster says it is increasing the amount of fair trade coffee it buys and it gives 5 percent of pre-tax profits to charity. However, it is also no longer a mom 'n' pop Vermont coffee roaster -- it is traded on NASDAQ and cleared $100 million in sales last year. In contrast, Dean's Beans did about $1.5 million in sales last year.

Dean says the coffee industry is taking a huge profit on the backs of third-world farmers, but it doesn't have to be that way. He says there's enough money to go around.

"It's a basic human choice," he said. "Are you going to pay people who provide you with such a good living a reasonable wage?"

Nell agrees with Dean on principle, and she said she was shocked when she traveled to Guatamala to see where some of the beans for the Newman's Own Organics coffee was being grown and how completely the farmers depended on coffee for their living. However, she said her company is going about pushing for fair trade in its own way.

"You have to applaud people who are actually doing something," she said.