7 questions about the road to fair coffee

If it’s up to us, the future of food is transparent and traceable. In our webinar series Trace Talks, we explore what it will take to get there. Last week saw the 4th instalment, in which we explored the road to ‘living income coffee’, together with Trabocca and Simon Lévelt. In a 60-minute session, we discussed all the ins and outs, the ambitions and possible pit-falls of our new joint project. Below are the seven most pressing questions from the webinar.

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How is the living income benchmark determined? And how is this information used in this project?
Certain trusted organisations are specialised in conducting research and publishing living wage and income benchmarks, like the Global Living Wage Coalition and the Living Income Community of Practice. One of the most widely accepted methodologies for calculating a living wage or income is the Anker methodology. In the case of this project, we will work with the Royal Tropical Institute, who will conduct field research to learn about the costs of living for the Ethiopian farmers that are involved in this project. That involves questionnaires and research that should help answer questions like, ‘what does it cost to send your kids to school?’, ‘how much should you spend on shopping to reach a healthy diet?’ and ‘what are the costs of coffee production?’.

“We noticed that there is still too much information missing to actually get to the bottom of the problem. That’s why this new project focuses so extensively on that living income benchmark”, says Menno Simons, founder and director of Trabocca. Ultimately, the project will move to actions to actually close the living income gap.

Why a living income matters? Well, as our director Sander de Jong puts it: “In times of crises [the farmers] don’t have a piggy bank to fall back on, but you also see, for example, that they cannot make investments to brace themselves against climate change, let alone have the flexibility to change the organisation and switch to a product that is better suited to the new climate. That is why we really need to realise: a living income is a human right.”

Learn more about a living wage and income here.

Is raising prices enough to have a positive impact on the farmers’ income? Are other measures needed or possible?
Increasing prices is one way to raise a farmer’s income (that is, if you can verify the extra money actually ends up in the right pockets). However, we will also be looking at other possible interventions. Maybe we can scale up the productivity per coffee tree. Or maybe it’ll turn out that we should be focussing on the strengthening of local governance bodies, like trade unions, to increase the farmers’ bargaining power.

Finally, like Trabocca’s founder Menno Simons mentioned in the webinar, one possible scenario is that there are farmers who simply own to little coffee trees to ever reach a living income. What can we do if that turns out to be the case? The true answer is: we don’t know yet. Time will tell what the farmers need most. In the end, what we want is for them to strengthen their position in the supply chain and become more independent.

Is the use of Trace scalable to the conventional trading houses?
That’s right, let’s not forget to mention that we will be using Trace in this project to make the coffee traceable and its journey transparent. Allow us to get a little technical: Trace can integrate with just about any supply chain related database, be it a traceability system, a farm productivity platform or a data collection tool. This makes Trace interoperable with existing systems. We do want you to get to the bottom of things, which to us means trace your products back to the farmers and verify any brand promises at farm level. Trace should make this easy for you.

Let’s say Trabocca or Simon Lévelt choses to extend Trace to other supply chains. That would indeed be feasible, insofar as they can keep track of separate batches and have enough leverage to involve supply chain partners, including farmers and/or farmer cooperatives. 

For large-scale coffee production, we could consider proportional traceability and claim verification, say ‘38% of this coffee is from Guji and of that 78% was fairly paid’. 

How are you handling the farmers’ privacy?
Legally, we abide by the General Data Protection Regulation (GDPR) and have farmers opt in before we can disclose personal information. Non-technical staff only have access to farmer data if they are provided with access by farmers themselves or their proxies. If no permission is given, all personal data are pseudonymised. 

On top of that, we have our own beliefs and will always see to it that the data sharing is done to benefit the farmers, not potentially harm them. Finally, to us the data provider is the data owner. Farmers are the owners of their data, not some big player down the supply chain. We are currently also looking into ways for farmers to monetise their data. We all saw how Facebook got stinking rich using our data, how can farmers earn money with theirs?

With an eye on transparency, we have one final confession: at the moment non-blockchained data are centrally stored and developers can technically access data, which isn’t perfect from a data security standpoint. So going forward, we’ll further extend the privacy-by-design components of Trace to include local data storage (e.g Ghanean data is stored on Ghanean servers), autonomous nodes (supply chain partners run their own data nodes) and self-sovereign farmer identities (farmers have full control over and can monetise their personal data). 

Should consumers have the decision power over farmers earning a living income? Or would legislation on due diligence here and in production countries be more effective and raise the bar for all?
We can be rather short about this: yes, legislation on human rights due diligence is the way forward to effectively raise the bar. Luckily, such legislation is underway

At Fairfood, we believe that consumers should not be burdened with the political choice for a product with or without human rights violations. At the same time, to pay a living wage or income is not some Unique Selling Point that brands should be able to use in their marketing (hear, hear, Menno, who said it all in the webinar). A living wage or income is a human right. 

What sectoral approach could enhance efficiency so not each company has to go and calculate their own living income gaps?
Good point. We actively urge companies to share their research and insights with others. Such important information should not be used for competitive advantages. That is why we are happy with initiatives such as the Sustainable Coffee Challenge, which Fairfood recently also became a part of. Such multi-stakeholder-platforms are build on information sharing and collective goal setting.

It’s also why we launched ALIGN, the online portal on living wages and incomes, and a guidance tool for companies who want to reach living incomes and wages in their supply chains. You, too, can share your projects and research in the Resource Library.

Living income research may show that only a small fraction of the household income comes from coffee. For example, a farmer may have a few coffee trees compared to a relatively big stock of cattle. Do you agree that as coffee buyers we should only take up responsibility to that small fraction impacting the current living income gap?
Yes, we do agree with that. This is exactly why this project holds such an extensive research phase, to better understand how much the household income relies on coffee production. The coffee industry can only take responsibility for their share in the total household income of farmers.

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