Our Origin Focus this month looks at the Fairtrade Minimum Price increase that came into effect on Tuesday 1st August 2023. DRWakefield were the first independent importer in the UK to become Fairtrade certified and certified coffee still represents a major percentage of the coffee we trade globally.
Fairtrade has a vast and diverse global coffee network. The organisation is comprised of 900,000 certified coffee farmers in over 650 producer organizations spanning 31 countries. As a result, the announcement to adjust their pricing structure will have a huge impact on global coffee markets.
Why now? According to Fairtrade, the move comes amid the intensifying impacts of climate change and growing global economic volatility. The goal is to provide farmers with significant price risk management support in times of wild market fluctuation, covering their needs as they face inflation in their home countries and substantial additional costs due to climate change adaption.
DRWakefield currently trades Fairtrade coffee from Brazil, Colombia, Costa Rica, Ethiopia, Guatemala, Honduras, India, Kenya, Mexico, Nicaragua Papua New Guinea, Peru, Rwanda, Sumatra, Tanzania, Uganda and Vietnam. In the next Origin Focus edition, we will be in touch with specific producers from some of these origins to understand the early-stage impact of the pricing adjustments.
Fairtrade use the ‘minimum price’ to mean the FOB price minus the 20 c/lb Fairtrade Premium (FP). This is different to the FOB minimum price which is what most trade/exporters/roasters refer to as the ‘minimum price’. The following increases have been set out for any coffee contracts agreed upon from the 1st of August 2023:
- FT Arabica Natural > increase of 40 c/lb (26%)
- FT Arabica Washed > increase of 40 c/lb (25%)
- FTO Arabica Washed > increase of 50 c/lb (26%)
- FT Robusta Natural > increase of 19 c/lb (15%)
- FTO Robusta Natural > increase of 29 c/lb (19%)
Click here for a full explanation of the Fairtrade Minimum Price Increase.
Click here to read Fairtrade’s article “Fairtrade to increase coffee Minimum Price”.
