There is a coffee outlet in London's South Bank called Costa Coffee and it's a seriously busy outlet. They sell a Fairtrade brand of coffee from a company called Café Direct who promise to offer the coffee farmers a good price for their coffee: typically a premium or extra payment of between 40p and 50p a pound of coffee which according to The Undercover Economist (2007) can mean a doubling of income for the farmer from around $2000 to $4000.
Okay,fair enough but let's look at the maths a bit closer. Costa coffee charges an extra 10p per cup of fair-trade coffee. Now it takes a 1/4 of an ounce of coffee to make 1 cup of cappuccino so you will typically make 64 cups out of 1 lb of coffee. (16oz’s in a lb, therefore 64 x 1/4 ounces). So Costa Coffee make about 6.40 per lb of coffee and yet the farmer gets less than 10% of that. Fair-trade how are you!
Nevertheless, in defence of Fair-trade and Costa Coffee, the rent they pay, I imagine, is astronomical. Are we just paying for space to sit down and relax?
Statistics taken from 'The Undercover Economist', Tim Harford, 2007, Publsihed by Little Brown, London
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