Advocacy Groups and Shareholders for Fair Trade Coffee

Small-scale coffee farmers around the world scored a victory the week of September 15, 2003, when Procter & Gamble, the largest seller of coffee in the U.S., announced that it would introduce Fair Trade Certifiedâ„¢ coffee products through its specialty coffee division, Millstone.

The announcement comes in response to dialogue with shareholders about the company's practices, as well as pressure from consumers, people of faith, human rights activists, and humanitarian organizations. Co-op America, the Interfaith Fair Trade Initiative, Oxfam, and Global Exchange all educated and encouraged concerned citizens to urge the company to begin selling Fair Trade Certified coffee.

Over the past three years, the price of coffee has fallen almost 50% and now hovers near a 30-year low. This has resulted in a widespread humanitarian crisis for 25 million coffee-growing families in over 50 developing countries. Unable to cover their costs of production, small farmers cannot earn the income necessary to feed their families, send their children to school, purchase essential medicines, and stay on their land. Grown by democratically organized cooperatives, Fair Trade Certifiedâ„¢ coffee guarantees farmers a minimum of $1.26/pound for their harvest. Last month, the International Coffee Organization composite indicator average price for green coffee was $.52/pound.

"P&G's action is an excellent example of what can be accomplished through the collaboration of shareholder activists and nonprofit organizations," said Sister Ruth Rosenbaum, Executive Director of the Center for Reflection, Education and Action (CREA). CREA and Domini Social Investments (Domini) led the shareholder dialogue with P&G.

With this decision, P&G, one of the four largest coffee companies in the world, joins an impressive list of over 200 coffee companies that currently offer Fair Trade Certified™ coffee in the U.S. Procter & Gamble's Millstone will immediately offer Fair Trade Certified™ coffee to wholesale accounts (universities, restaurants, etc.) and to consumers through its website. P&G has committed to build significant consumer demand for Fair Trade Certified™ coffee. This commitment is planned to result in P&G becoming a leading U.S. buyer of Fair Trade Certified™ coffee—which would represent purchase of at least 2-3 million pounds per year, based on today's estimates.

"More farmers than ever before will now receive a fair price for their harvests," said Deborah James of Global Exchange. "By establishing a floor price, Fair Trade enables farmers to make a dignified living while providing new opportunities to cultivate high-quality, environmentally sustainable coffee."

Shareholders and NGOs cautioned that they will hold Procter & Gamble to its promises and continue to monitor its progress. "We're glad that Procter & Gamble is making this first-step commitment to Fair Trade, and look forward to the day when it commits to paying farmers a decent price for all its coffee—like the coffee companies that pioneered Fair Trade," said Sarah Ford of the Interfaith Fair Trade Initiative.