A New Direction for Fair Trade USA: A Contextual Analysis of Latin American Coffee Farmers

This paper uses the historical context of the United States and Latin American coffee trade to analyze the new direction Fair Trade USA has taken in parting from the Fair Trade label certifying board, Fair Trade International (FLO). The original Fair Trade Model set minimum prices per pound on coffee, offered premium payments for community development, and enforced environmental standards to small farmers who organized into democratic cooperatives. Coffee importers and Latin American farming cooperatives designed the original model; therefore, farmers organized into democratic cooperatives have always been a requirement for Fair Trade certification. The reason is that cooperatives empower small farmers against a confluence of past events that economically marginalized them in the conventional coffee trade. The benefits—prices, premiums, and environmental improvements—continue through Fair Trade USA. However, Fair Trade USA now certifies small independent coffee farmers and coffee plantations. Opening up Fair Trade certification to farmers who are not part of a cooperative, challenges Fairtrade International’s theory of change: cooperatives lead to democratic organization and economic empowerment. This paper analyses FT USA’s new direction by first telling the story of the coffee trade and the events that led to small farmer vulnerability. Then, I will prove that the issue of Fair Trade USA certifying more farmers is not that non-cooperative farmers cannot become democratically and economically empowered, but that increasing the number of producers and not the size of the Fair Trade market share leads Fair Trade USA onto a fine line between progress and repeating history. Keywords: Fair Trade, coffee, Latin America, ethical trade, economic empowerment, histor