Monday, August 12, 2002

not a red herring

recently i had the privilege of talking about the coffee price depression and its resulting horrible effects with one of the nation's premier independent roasters. among the problems we discussed was the fact that in latin america, many former coffee farmers are now growing illegal drugs, like coca, to avoid hunger, bankruptcy and loss of their family lands.

the roaster replied that this issue is a "red herring." with all due respect, i have to disagree. nearly every 2 weeks i see another news article discussing the rise of coca production; the reason given is nearly always the low price of coffee.

let's work this out. at what appear to be current market prices, a farmer can get about US$1.82 per pound (half a kilo) for coca from narco-traffickers. meanwhile, most quality arabica coffee is worth less than US$0.50 cents a pound. fair-trade coffee programs pay the farmer about US$1.26 a pound. the cost of producing coffee is between US$0.80 and US$0.90 a pound.

these facts seem pretty clear; if a farmer wants to stay legal and keep his land, then fair-trade programs will allow him to do this. the fair-trade price is 30% less than the coca price, true, but still close enough to encourage farmers to stay legit.

since much of the cocaine that will be manufactured from the increased coca crop will end up on streets in the u.s.a., i'd have to say that those concerned with containing our country's drug problem need to focus in on the coffee situation, by expanding fair-trade programs to places that are not currently eligible, or helping farmers change production and organization to make them eligible for fair-trade programs. for example, the u.s.a. has given troubled colombia US$1.3 billion over the last two years for coca elimination programs in the "war on drugs." maybe more of this money should go to a market-oriented coffee program.

in this light, the berkeley initiative to force retailers in that city to sell only fair-trade coffee appears less silly. not that i support the plan, since it seems unenforceable. but when you're in your local roasters, considering what coffee to buy this week, i'd encourage you to remember this issue, and consider buying fair-trade. . .

posted by fortune | 6:48 PM | top | link to this | email this: | links to this post | | 0 comments

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