In the early 1990's, CoDevelopment Canada, the non-profit that owns Café Ético, was working with a rural community on Ometepe Island in Nicaragua on a project to improve access to water. Many of the community members were part of Finca Magdalena, a co-operative of small-scale coffee farmers. Although at the time coffee prices on the world market were not abysmal, the cooperative did not sell their coffee directly to importers, but rather to middle men, vastly reducing the price they received. The co-operative also had a fairly large bank loan that was eating up the meagre profits from their coffee harvests, and, thanks to high interest rates, the loan was growing rather than shrinking. The co-operative was caught in a vicious cycle, and feared for their survival.
Seeking a long-term solution, Finca Magdalena co-operative members told CoDev and other grassroots Canadian organizations working with CoDev that something they really needed was a way of getting a better price for their coffee. The organizations sat down with co-operative representatives, and hammered out a price for coffee that would reflect the immense amount of labour and expertise that goes in to organic coffee production, and that would afford farmers and their families a dignified standard of living. Soon, CoDev and their partner organizations were buying 100% of the co-operative's coffee.
Within two years, the Finca Magdalena co-operative had paid off 100% of it's bank loan, and could begin operating free and clear of debt, and begin investing in their co-operative, their members and their community. Today the co-operative is a thriving organization, which, in addition to farming coffee, now operates a successful hostel, attracting thousands of visitors and educating tourists on coffee and organic agriculture.
Demand soon outgrew supply, and Café Ético began purchasing coffee from farmer co-operatives in Northern Nicaragua, from which we continue to purchase today.
Why fair trade?
Café Ético believes in doing business with a conscience. With millions of people's lives worldwide depending on the coffee trade, paying a fair price for coffee makes a significant difference in the lives of coffee farmers and their families.
At Café Ético, we believe that farmers deserve a fair price for the enormous amount of labour and expertise they put into growing top quality coffee for us to enjoy. We are dedicated to creating direct, long-term relationships with coffee producers based on respect, fairness and equality.
In conventional trade, coffee prices fluctuate wildly not just from year to year, but from month to month and day to day, making it difficult for farmers to predict what their harvest will be worth. What's more, coffee is generally a yearly harvest, and farmers often have to take out loans at the beginning of the year to invest in their crops and to pay for day-to-day living expenses. If coffee prices fall drastically, as they have often done, a farmer can lose everything paying off their loans, including their land.
With fair trade, farmers are guaranteed a minimum price that will never fall below an established base. Farmers are entitled to deposits on their coffee at the time importers place their order, meaning they are less reliant on loans. Thanks to the stability of fair trade prices, farmers and their families are able to plan, invest and improve their standard of living.
Why direct trade?
While fair trade is important, direct trade is just as essential to ensuring that farmers get a fair deal.
Most small-scale coffee farmers don't have access to the overseas market. Instead, they sell to middlemen, often called 'coyotes' in Latin America, who in turn sell to exporters, who in turn sell to importers, who sell to roasters, who sell to grocery stores, who sell to us. By the time everyone has taken their piece of the profit, there's very little left for the actual coffee farmer. Even if the world market prices is reasonably high, small-scale farmers only get a fraction of that price.
By purchasing directly from farmer associations, direct trade ensures that farmers get the highest price possible for their beans. Café Ético buys coffee directly from the Pancasán Association of Organic Coffee Farmers (ACOPAN) in Nicaragua, and from the Campesino Committee of the Highlands in Guatemala.
Why Café Ético?
Café Ético is proud to be one of Vancouver's first fairly traded coffee importers, and continues our commitment to fair trade today. We have consistently paid a higher price that international fair trade minimums, and today have a commitment to pay at least 20% more than the established fair trade base price.
Café Ético is also thrilled to be starting a three-year project with the co-operatives we purchase coffee from in Northern Nicaragua to help farmers improve coffee production efficiency and quality, and to help co-operatives serve their members better. We also worked with the Campesino Committee of the Highlands in Guatemala to help install electricity for the water pump at their coffee processing facility, thereby helping them process more coffee more efficiently.
Café Ético is proud to educate Canadians about fair trade, and is always happy to come to your school, workplace or special event to talk about fair trade, organic agriculture and social justice in Latin America. We also run coffee-themed tours to Nicaragua and Guatemala.