Fair Trade vs. Direct Trade

Stepping into my local coffee shop inquiring if they sell fair trade coffee – I was told that they had something better – “Direct Trade”. I was told this cut out the middle man in Free trade, and was the next step up. Excited, I bought the coffee, and then came home to investigate.

I also began reading more intensly my book on fair trade "the prospects and pitfalls of market driven social justice"
I am disappointed by both. More so by Direct Trade since they are demeaning to Fair Trade on their website, and trying to compete in a tiny market of ethical consumers rather than bring in new ones. And it appears they don't have better labor standards.
The book points out that with the collapse of the international coffee agreement in 1989 the price of coffee was much higher than it is today - even above fair trade prices. Fair trade a few years ago only compromised about .5% of the coffee market. So here we have some people making a little bit of money, but it is bascally peanuts. And people buy it thinking they are doing good, when they don't realize that even walmart used to pay higher price - more fair - than they are now!

I wanted to write a critical assesment of both on the blog at my internship, but I was censored. First time. I guess i can understand why since we put out catalogues of suggestions for how people can be more ethical consumers. But at the same time, isn't being realistic also neccesary? like tossing a dime to the starving child and feeling warm and fuzzy for your contribution for solving world hunger.

So even while fair trade has its pitfalls, some within it are actually trying to change the marco-economic policies, and sell fair trade products as only one small part to increase awareness and create fertile ground for cooperatives around the world who are trying to create an alternative structure to the corporate model. ie no hierarchy, democratic control of the workplace, social conciousness. the foundation must be layed first. Although other fair trade theorists have no such desire and want to increase marketability and don't believe the neocapitalist can or should be changed. It is what it is.
The dangers of co-optation. If Starbucks becomes the major buyer of fair trade coffee this raises legitamate holy fuck type questions. apparently they have already pushed for changing the labor standards, and who fair trade deals with. I think some of this already was implemented. If fair trade becomes mainstream through corporations, who then determines its course? who holds the power? these alliances should be made with suspicion. the book points out that the world bank, imf, starbucks etc. are all in favor of fair trade - at the micro level. (just enough anyways - starbucks only buys 6% fair trade coffee). But none of them would ever support changing the fundamental structures of domination - macroeconomic policies.
I emailed "Counter Culture" about their labor standards with the following questions. What really bugs me is that try to pretend to be all revolutionary on their websites, when they don't even have a vision to change anything. They also mention how transparency is fundamental, but none of the farms they trade with have websites, no way i can check up on them. I guess its easy to be transparent when there is no information. Like me: i am completely honest concerning all aspects of my artwork! uhhhh...


1. Are there specific criteria used to judge labor standards?

2. Are these criteria a prerequisite to developing trade relations?

3. Direct Trade is compared to Fair Trade throughout the website. Since an integral mission of Fair Trade is based on ethical working conditions adhering to ILO standards (no child labor, right to unionize, etc.); by saying Direct Trade has higher standards suggests that Direct Trade ensures better working conditions. Is that a proper assessment?

(“Meanwhile, we recognized that our own standards of quality, transparency, and fair pricing were somewhat higher than the FTC standard. We developed the Counter Culture Direct Trade Certification in the desire to raise the bar of fairness and sustainability and lead by example in the coffee trade”.)

4. One of the biggest criticisms of Fair Trade coffee is that its ‘fair’ price is actually below what the market was before the International Coffee Agreement was abandoned in 1989. The sales of both fair trade and direct trade do not even begin to fill the gap of the price drop. In the interests of social sustainability, does Counter Culture support efforts to change macro-economic relations?

5. Why did Counter Culture choose to peg its bottom floor price in relation to Fair Trade – which it can be argued, is not meeting the needs of farmers.

6. Does Direct Trade aim at increasing the amount of ethical consumers – by offering better coffee, or does it simply compete with Fair Trade consumers?