For producers in developing countries, international trade has the ability to raise income generation and alleviate poverty. When considering the coffee market, consumers, in return, receive access to a crop grown thousands of miles away in climates different to their own.

However, how does a marginalised producer traditionally exploited by middlemen and receiving sometimes less than the cost of production for their crops, access this global market, much less get themselves to a point where they have the capacity to trade at a level expected by developed countries?

This is an aspect that free trade theories fail to take into account as a reality of trade; the unfair playing fields of the world. To organise, increase production, improve quality, market and promote a product, producers need access to capital. Capital is a luxury taken for granted in countries such as New Zealand where the average consumer spends $1.15 for every dollar earned, but it is an unavailable luxury to a typical coffee producing community.

Justin Purser, Trade Aid's coffee buyer, talks below about how the fair trade system can help level this playing field by building the capacity of groups of producers to a level where they become equal partners in their trading activities.

“Producer groups who have sold their products to fair trade buyers for a longer period of time show many signs of organisational strength and in some instances – notably within the coffee sector, where demand for fair trade supply continues to grow strongly – they are now able to pick and choose their buyers, and to negotiate strongly on prices and terms. We see this as an excellent example of empowerment in action!

For new groups, with a history of exploitation and relatively undeveloped business capacity, such a scenario is still a distant dream; these groups very much need the help of dedicated fair trade buyers to help them to take the necessary steps towards the point where self-reliance is more realistic.

Twin Trading, a UK-based fair trade commodities buyer, is one such organisation that I had the chance to watch in action recently. Priding themselves as a pioneer in helping to establish fair trade producer groups, they have successfully assisted many groups into the international fair trade market.

APKLO are a small, recently-formed coffee co-operative based in the Lintongnihuta region of northern Sumatra who currently have only one, Japanese-based, buyer for their coffee. While they have a great degree of enthusiasm for the potential benefits that they can enjoy as a group through fair trade, they face a problem typical of new groups – how can they attract buyers, given their lack of trading experience?

On a first visit to the group, Richard Hide, Twin’s coffee buyer was able to meet twice with committee members of APKLO and covered all of the areas he has identified as vital components of a successful fair trade relationship. For the group, he advised that over time they would need to become highly proficient in three broad areas; quality control, marketing, and financial management. He was able to help, based on his experience and from what he saw on field visits at the co-op, to identify a number of critical measures the group needs to address if it is to attract and retain more buyers. He was quick to stress that Twin would be happy to partner APKLO through the process he outlined.

It was apparent that although no-one within the group speaks English well, that key people could become proficient in English with extra tuition. As the language of international trade, anyone entrusted with marketing their coffee must speak and write sufficient English if they hope to attract new buyers.

Ensuring adequate coffee quality was also highlighted as a crucial task for someone from within the group; someone who could, for example, both reject (with the support of the entire group) coffee delivered by friends and neighbours if it was deemed to be defective, and who would also be prepared to travel with the coffee throughout its various processing stages to ensure that it made it into a shipping container in the best possible condition.

He continued on down his list of suggestions, touching on areas such as the value of attaining organic certification, the importance of advice from an agronomist on how best to manage pest control, and his willingness to perform cupping analyses on various coffee samples, if they would be sent to him, in order to provide ongoing feedback on quality. He arranged to supply the group with Twin’s fortnightly coffee bulletin, which he could see would help them to become conversant with trends in the international coffee trade which would inevitably have implications for their own business.

Looking ahead, there was much discussion about possible further ways in which Twin could help APKLO to identify areas where improvements could be made. One day, years from now, the expectation would be that so long as the group trades well, and uses its fair trade income wisely, it will no longer require the ongoing support of a Twin and can plan its own future direction truly independently”.

Justin Purser - May 2007