Advice and answers from the Dispatch team
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When we answer questions about impact, we believe it is important for us to define terminology, as “ethics” and “sustainability” can be defined and interpreted in many ways. This enables us to build consensus as a team, and those sharing data with us across our supply chain, as well as with you, our customers! When we make a coffee purchase or operating decision, we consider the impacts of these three spheres: Economic, Social and Environmental. This is the recommended lense for discussing impact and sustainability by the UN sustainable development goals, and Impact Management Program, a forum for building global consensus on how to measure, manage and report impacts.
Impact management in our company is an ongoing practice of measuring and improving our impacts, so that we can reduce the negative and increase the positive. We do this activity internally, tracking and considering impact across many spheres in our supply chain lifecycle From Coffee Purchasing and other suppliers partners to Employee Policies and Culture to packaging, supply and retail distribution.
We are working to make our impact measurements and improvement objectives public facing by 2021. In the meantime, we are applying for B Corp certification.
Our vision of responsible sourcing includes, but is not limited to certifications. This said, 16% of the past 32 coffees we have purchased in 2019-2020 were from Fair Trade Certified Co-Ops.
Third-party certified coffees are part of developing a sustainable industry, with a range of sustainability goals. Some certified coffees focus on ensuring environmentally friendly farming, while others address the social wellbeing of farmers and farming communities, or guarantee a minimum price paid to producers.
Fair trade coffees focus on the latter, as well as connecting farmers to importers and the market and training and development programs which support farmers’ agency and profitability. Fair trade certification evolved as a way to pay farmers a guaranteed minimum price for a pound of coffee at a premium above the commodities price. Traditionally, commodities pricing is extremely volatile and low (below the costs of production for most smallholder farmers). Though an incredible initiative and organization, fair trade minimum pricing cannot reduce all threats to our industry’s sustainability or the wellbeing of farmers. This is why we don’t limit our purchasing practices and responsible sourcing decisions to just one certification alone. Fair Trade guarantees that a Co-Op is paid $1.40 USD per pound for their coffee. This number is only relative to what the average farmer in a given co-op will earn above their fixed and variable farming costs.
A research study conducted by Fair Trade USA and Cornell University, “The Cost of Financially Sustainable Coffee Production in Latin America”, cost of production for an average 1.6 - 5.3 hectare farm ranged from $0.88 USD to $1.75 USD per pound, which means that coffee producers can still earn less than their operating costs, even in a Fair Trade Certified Co-op. Our average FOB price on the past 32 coffees we purchased in 2019-2020 was $2.69.