Coffee Farmers

17-PROTO-articleLarge(Piture from “Coffee’s Economys, Rewritten by Farmers”, by Nicole LaPorte)

All Coffee comes from the coffee beans, which were planted by coffee farmers, who also happens to be the ones that earn the least in the coffee commodity chain. Most coffee comes from countries in centrual America, like Costa Rica and Guatemala. Kenneth Lander, a former lawyer, is a coffee farmer in Costa Rica. As a coffee farmer, he belonged to a co-operation called “fair trade”, and it only guaranteed farmers minimum prices. So he was only making $1.30 for a pound of coffee that retailed in America for $12 a pound, and only had a 12-acre farm that produced 6000 pounds of beans each year (LaPorte 2013).

However, by involving in a different trade modle, Thrive, Lander is now able to make profit that is 4 times as much as they would  through fair trade. What is so different about Thrive? In a fair trade system, a farmer earns the market price because the commodity market price is higher than the fair trade price, but the co-op gets the premium. Fair trade buyers buy the unroasted beans from farmers, but the additional price and value of beans comes after the beans are processed. In a Thrive system, farmers will be paid only after their beans have been exported, packaged and sold; in addition, they also need to pay higher costs of processing and exporting. However, through Thrive system, farmers can get 50% of the price coffee is sold. For example, if a package of coffee were sold for 8 dollars, farmers receive around 4 dollars. In this way, not only do the farmers make a lot more money, they can also see their coffee being processed, exported and sold, so they are also more involved in the whole coffee chain and gain more control over their coffee in a way. For farmers to make a better living, innovative business model like Thrive provide them with a chance to play a far more important role than just selling their coffee in a low price because of coffee middlemen’s “manupilation” and fair trade business model, and thus earn more money as a result.

 

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