by Bruce Wydick
“After this comes roasting, which is usually done after the beans are exported to the consuming country, like los Estados Unidos or Europa. Roasting heats the beans to four hundred or five hundred degrees, and the oil inside the beans, the caffeol, begins to come out and makes the beans brown and gives them their aroma and flavor. Roasting removes another 20 percent or so of water weight, and this leaves you with 100 pounds of pure, roasted coffee.”
“My money says that’s where Señor Fernando’s profits are going,” Rich commented to the other students in English. “Profit probably captured at the roaster level. Few roasters, many growers. Buyers’ market.”
“Then from the roasters to the supermarket?” asked Angela.
“Yes, or Starbucks, Peets, or anywhere else,” said Rich. “Mmmm . . . this sure is good, Juana. Muy sabroso,” he added. A love of fine coffee was one of the few values he shared with the other citizens of Berkeley.
“What about fair trade coffee?” asked Alex.
José-Ernesto flashed the students a sparkly smile, again revealing his golden dental work, eager to respond to their barrage of questions. He narrowed his eyes as he considered his response. “With fair trade coffee certified by the Fair Trade Labeling Organization, and TransFair, the certifier for the North American market, international growers receive a minimum of $1.31 per pound for arabica green coffee and $1.01 for robusta.”
“A price floor,” Rich summarized.
“Exactamente,” agreed José-Ernesto. “When the coffee crisis hit a few years ago, the price dropped to less than half of this fair trade price, and selling under fair trade was a big advantage to growers. It helped many growers make it through the crisis. But when the world price of coffee is higher than this, being able to sell at the fair trade doesn’t bring much of an advantage.”
This confused Angela. “Wait a minute. You mean now that coffee prices are above the fair trade price floor, when someone in the US buys coffee that is called ‘fair trade’ it doesn’t pay the grower any more than regular coffee?” She realized that she had inadvertently stumbled on an important piece to the puzzle.
“Well, in addition to the $1.31 per pound, there is a premium of ten cents per pound added that is to be used by the producer associations for investment back into the association or into the local community. This means that the final price is always ten cents higher than the world price. Moreover, if the coffee is certified as organic, there is an additional premium to the grower of twenty cents extra. But you are right, when the world price of coffee is above the fair trade price floor, the added benefit to growers of fair trade over conventionally marketed coffee declines substantially.”
“I’ll bet that would be interesting news to latte-sipping liberals,” commented Rich not so subtly in Sofia’s ear.
José-Ernesto continued. “Fair trade certification is an important issue. To be eligible to sell their crop through fair trade networks, a producer must be certified. This means that his farm should comply with a set of environmental and labor standards. Some of these growers are very poor, so compliance is not perfectly enforced but the regulations say that growers must comply ‘as far as possible.’ The cooperative to which they belong must also meet requirements for democratic participation of members, especially in regards to how the social premium is spent by the cooperative. An umbrella institution in Germany called FLO-CERT oversees a network of inspecting organizations in coffee-producing countries that each certify growers for fair trade, administer the sello. The certification process costs each grower a little more than six cents per pound for the first certification and a little more than three cents per pound each year after that for recertification.”
Alex redirected the conversation. “Fernando, tell us about the advantages of fair trade over free trade.”
Rich interjected with a smile, “Gee, I always thought the two were the same thing.” Alex turned and looked at Rich, shaking his head slowly and disapprovingly.
Sofia rephrased the question. “What do you see as the benefits and costs for growers of fair trade coffee, Fernando?”
“Pues, to me it wasn’t an easy decision. There is the cost of getting the sello. And sometimes the fair trade price is much better, and sometimes it’s only a little better. It is a gamble. If I get the sello, then I’m betting that coffee prices are low. If I don’t get it, I am betting that the price is high.”
“And what about the organic coffee channel?” Sofia glanced up, sketching some kind of complicated diagram on her notepad teeming with the different channels the coffee beans might take.
José-Ernesto answered. “Organic and fair trade often go together, but not always. About 75 to 80 percent of fair trade coffee is organic, and most organic coffee is fair trade. The benefit that the organic growers receive is not so simple because of the relationship between fair trade and organically grown coffee. If arabica fair trade coffee is certified organic, then it does receive a higher price, right now $1.61 per pound. And to have, for example, Starbucks certified coffee, a grower receives a certain number of points, and farms with increasing numbers of points can get a higher premium from them, sometimes $30 to $35 per one-hundred-pound sack. And fair trade coffee can fetch a higher price by being certified as bird-friendly, which automatically means it is shade-grown as well as organic.”
“Do you grow organic coffee, Fernando?” asked Angela.
“No.”
“Why not?” she asked.
“Pues, it depends on coffee prices. If regular coffee prices are very low, then I would do better with organic coffee. But if prices are high, then I would do worse with organic.”
“What matters badly with organic?” Alex asked in Spanish. Any talk of organic or fair trade not being an obvious choice under all circumstances appeared to make him edgy.
Fernando explained. “Because organic costs more to grow. You have to pay for more jornaleros, the agricultural day workers, because there are many more tasks with organic. Because you can’t use pesticides, you have to spread compost carefully around all the plants and do about twice as much raking and weeding. Your coffee plants die more often, so you also must replant more frequently. So when regular coffee prices are high, I do better by getting higher yields on regular coffee using pesticides and chemical fertilizers.”
“It is unjust not to compensate borrowers for such added costs,” pronounced Alex to the others. It was clearly shocking for him to see a coffee grower involved in fair trade living in poverty.
But Angela and the others were discovering another piece to the puzzle: entering into the potentially beneficial fair trade and organic coffee channels involved some significant costs to growers. It wasn’t a straightforward decision.
“There is another problem,” added Fernando. The students listened. “The cooperative tells us they can only market a certain amount of coffee through fair trade channels because the market for fair trade is only so big, only about one out of every four sacks. So I only receive the high price on the part that can be marketed as fair trade. Es un problema.”
“So how much of your crop do you sell to the cooperative and how much do you sell to the coyotes?” Angela asked. The students had learned about the coyotes, local buyers who appeared at the farm gate every day during harvest, offering to buy growers’ coffee. The coyotes offered lower prices but paid in cash right away.
“It’s hard to wait such a long time to be paid,” Fernando explained. “Last year I owed a great deal of money for school fees. I needed money right away, so I sold about two-thirds of my crop to the coyotes for $120 and the rest to the co-op.”
“So let me understand,” said Angela to clarify, “you didn’t get any of the benefits of fair trade with two-thirds of your crop, and with the remaining one-third that you sold to the cooperative, only a quarter of that could be sold as fair trade?”
“Si,” said Fernando. “But prices weren’t too bad last year, so I got by. A few years ago when prices were so low, it was terrible, especi
ally for people without fair trade. Some people never even bothered to harvest their coffee because just the cost of paying the jornaleros was more than what they got for their coffee. Some growers couldn’t pay their debts, and everybody was leaving to immigrate illegally to the United States. It was really bad. In those days, the fair trade premium helped me and my family and other members of the cooperative to make it through okay.”
Angela was surprised to discover that the benefits of fair trade coffee were so finely nuanced, and that they were so heavily dependent on coffee prices.
They thanked Fernando and Juana for their time and for the wonderful lunch, then asked if Alex and Rich could come back tomorrow to do some cost calculations on Fernando’s crop. Fernando said it would be his pleasure, and he would see them tomorrow. The students began the two-mile walk back to the Hotel Chinita.
CHAPTER 8
Alex
ALEX AND RICH WALKED TOGETHER AS THEY DESCENDED THE mountain path. Angela and Sofia followed somewhat behind them. Only momentarily after their departure, Alex remarked, “Did you hear that? The problem is incredibly obvious—not enough people buying fair trade. Why can’t lazy, rich coffee drinkers wake up and see how much they are exploiting the growers down here?”
“Alex, I have a question for you,” Rich replied carefully. “Do you think Fernando and Juana’s poverty is caused by lazy, rich coffee drinkers?”
“Of course,” he replied. “And the corporate conglomerates that sell coffee to them. Wherever there are weak and vulnerable people in the world, the free market is expert at finding them and exploiting them to increase the profits and welfare of the rich. It all makes me sick.”
“What do you think about the US embargo against Cuba?” Rich asked him. Alex suspected this could be some kind of trap, but could not see it, so he decided on the earnest answer: “I believe it profoundly sucks.”
“Hmmm . . . okay . . . Not allowing countries like Cuba to export their products is oppressive. But when the United States signs a free trade agreement with a Latin American country, that’s oppressive too. Kinda leaves you wondering whether trade is a good thing or a bad thing, doesn’t it? I swear, Alex, if you put the collective brains of the antiglobalization movement in a gnat’s butt, it’d fly backwards.”
Alex didn’t quite make the connection between brains, gnats, butts, and globalization, but he persisted nevertheless. “Don’t you see, Rich, trade between rich and poor countries is fundamentally unfair. It always benefits the wealthy.”
“Gee, I was always under the impression that free exchange benefited both parties. Otherwise, why would they exchange? Well then, if you’re right, Alex, Cuba sure must be a lot better off with that embargo than those poor Latin American countries with the trade agreements who have access to the world’s biggest consumer market.”
“The world’s biggest consumer market is exploitative.”
“I don’t understand your use of the word ‘exploitation.’ ”
“You are right. You do not understand it.”
Rich grimaced. Sweat was starting to leave dark patches on his tightly fitting Hawaiian shirt, and it obviously wasn’t just from the hike.
As a master’s student scrapping with the doctoral candidate from Berkeley, Alex was beginning to see himself almost in a Davidic role, and he felt like he was at least effectively annoying Goliath with a few pebbles to the forehead.
Goliath responded, “Frankly, I find ‘exploitation’ to be an ill-defined word that is used by some folks to mean whatever they want it to mean. What I understand is ‘better off’ and ‘worse off.’ Would Fernando and Juana be worse off if they were prevented from selling their coffee on the world market? Obviously they would because they believe it to be their best option, unless of course you view them as incapable of making good decisions for themselves. Moreover, I never said that through international trade they would become rich as oil sheiks. With or without trade, poor folks are unlikely to be better off than rich folks. I just said that trade would make them better off than otherwise. Besides . . . didn’t the good Lord himself say that the poor would be with us always?”
Alex remembered this quote from someone in a debate he had attended once at his university. “Yes, indeed I believe so. But wasn’t it to Judas?” For the first time Rich didn’t seem quite sure what to say. With a flick of his shoulder-length hair, Alex turned to Rich, looking him directly in the eye. “If globalization is so wonderful, how can Fernando and Juana be remaining in destitution when they sell some of the most flavorful coffee in the world that you so fondly enjoy drinking?”
They arrived at the hotel, Rich looking sweaty and exasperated.
It was time to say good-bye until tomorrow when José-Ernesto would guide Sofia and Angela as they explored the fair trade cooperative that bought Fernando’s beans. Rich and Alex would be working together to carry out cost estimations on his coffee.
CHAPTER 9
The little bundle nestled against the young woman’s back began to stir. It was hungry. The young woman slowly rose up out of the hay and in one motion pulled on the knot in the colorful blankets, bringing it around in front to nurse. Somehow the infant had remained asleep through her dash to the barn, the screams of villagers, the gunfire.
Just as it began to nurse peacefully, they were jolted by the sound of the officer shouting orders through a bullhorn. The woman sat up to look. The bullhorn was aimed at a group of villagers who had locked themselves inside of the Iglesia Pentecostes, the local Pentecostal church. She knew the pastor of that church, Pastor Juan. She was fairly certain he was not a guerilla sympathizer. However, he may have sympathized with some of those who sympathized with the guerillas. She wondered how far removed from sympathy one would have to be in order to be safe from the army. Many of those locked inside the church were certain to be his parishioners. They were unlikely to be sympathizers either.
The army had come to the village once, to remind the villagers about the perils of helping the guerillas. They had delivered a stern lecture in the center of the village. They had encouraged villagers to tell the civil patrols if they suspected a particular person of helping the guerillas. The guerillas could not exist without villages friendly to their movement. They were like rats. If you take away the garbage, the army had explained, the rats will stay away. People who helped the guerillas were like garbage, and the guerillas were like rats. And so to get rid of the rats, the garbage had to be eliminated. This was how the villagers understood what the army had said to them.
The young woman considered what the army had said about rats and garbage. Some guerillas, she had agreed, might be like rats, sneaking around at night, stealing food, and causing trouble. But the guerillas who had come into the village, at least the ones she had met, were not like rats. They were mostly starving and wounded from fighting the people who were threatening them.
And she and Mildred had given them help.
One of the guerillas was Alberto. He showed them scars where bullets had come in and out of his leg, just below his knee. He was proud of the scars, proud to show them to her and to Mildred.
They had stayed up late one night and talked, the three of them, when Alberto was in the village. Mildred had asked him why he fought. He said that he fought the government because the government did not care about the Mayan people. It wanted them to be slaves of the ladinos forever, working their coffee as underpaid mozos. The government did not want to provide them education, he said, because it was operated by coffee owners who wanted to keep the mozo stupid and dependent, reliant on the landowner for work. He was fighting for a new government, he said, one that would bring dignity back to the Mayan people.
They were fascinated listening to Alberto. He was brave and had bold ideas, even if they did not understand much about a new government, or even the old one. People in their village had mostly preferred to be left alone by the government. That, they found, was generally how things turned out best. When the government came to their village,
it always seemed to spell trouble.
She saw at least four pickup trucks and two large wagons with canvas covers, which she assumed had brought most of the soldiers. There must be at least thirty of them, she thought, plus the members of the civil patrol from the village. She could tell even from a distance that the soldiers were not from this part of the country. They never were. Alberto had explained that the government always deployed soldiers from different parts of the country for counter-insurgency operations in an area that needed to be cleansed of guerrilla sympathizers. It made communication in indigenous language between the enlisted men and local villagers nearly impossible and played upon old rivalries between Mayan groups. Yes, Alberto had explained all of this to them. And he had told them other secrets as well.
Angela
June 11, 2007
After contacts with the growers had been established, Sofia and Angela began to pursue the second link in the coffee value chain: the purchase of Fernando’s harvest. They hoped to find more clues that would help explain how coffee growers cultivating some of the best arabica beans—brewed in some of the most expensive cups of coffee in the world—could be living in such destitution, even as they marketed through fair trade networks.
They had learned that coffee growers in Huehuetenango had essentially two options for marketing their harvest. The first was selling their coffee to the local wholesale buyers, the coyotes, who appeared doggedly at the farm gate during harvest offering immediate cash for their crop. Aside from the quick cash, another benefit of selling to the coyotes was that they were relatively lenient on quality. Ideally, coffee cherries should be picked when they have turned fire-engine red, but the coyotes would allow a small fraction of immature greenish or yellow-orange cherries in the mix. But the prices the coyotes offered were relatively low. The other option for growers like Fernando was to market their coffee through a local cooperative, which offered a higher price and had access to fair trade markets. But the cooperatives insisted on higher quality and required the grower to transport the coffee to the cooperative.