Coffee farmer welfare: where are we?

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Amid the global drive for environmental policies, Global Coffee Report highlights the initiatives that are prioritising and sustaining the human element within the coffee supply chain.

While the industry increasingly focuses its attention on environmental sustainability and global initiatives to future-proof coffee crops, the human element of the supply chain can often be overlooked.

Consumers’ interest in sustainability is driving companies to do better for the planet. And with the European Union Deforestation Regulation (EUDR) set to take effect by the end of 2025,  the sector is ramping up its efforts to support conservation. The momentum is inspiring, but what’s often left out of these conversations is the people who work and live on the land.

Those at the start of the supply chain – from farmers and pickers to processors and local cooperatives – are the lifeblood of the coffee industry. Without their efforts, there would be no beans.

There is, however, a growing movement of non-governmental organisations supporting these workers to ensure they have not only a stable standard of living but also the skills necessary to adapt during times of poor harvests.

Building from within

Dr Kate Schecter, President and CEO of World Neighbors, says the organisation promotes sustainable development, improves livelihoods, and teaches self-sufficiency through long-term, community-driven solutions in 14 countries throughout Asia, Africa, Latin America, and the Caribbean.

She describes the international development body as a capacity-building training organisation with a strong focus on long-term sustainability.

“We aim to help people help themselves, enabling them to become self-sufficient through skill development,” says Dr Schecter.

With crop volatility, like that seen in Brazil and Vietnam recently, she says diversification of income is key so that workers are not solely dependent on cash crops such as coffee.

“The ultimate aim is independence. We focus on training people to access these services through their own resources, whether via the government or their own businesses,” she says.

“In all our communities, across 14 countries, we help them raise their own funds, but we do this through savings and credit groups rather than microfinancing.”

She explains that microfinancing can be problematic if someone can’t repay a small loan, they risk default, and that can create long-term issues. World Neighbors’ focus is on creating savings and credit loan groups, where people save money together, lend to each other at low interest, and invest in private needs or community projects.

And when it comes to coffee growers, World Neighbors may assist them in connecting with coffee cooperatives or accessing resources. Dr Schecter explains some growers are isolated or have such small-scale operations that they lack access to cooperatives.

“Although we help them access resources, our staff aren’t coffee experts. We want to build local capacity for those issues since our goal is always to exit, leaving behind a self-sufficient community,” she says.

When World Neighbors first enters a community, the organisation begins by assessing its priorities and existing resources. This approach, known as an asset-based assessment, focuses on what the community already has to build upon rather than concentrating on what is lacking.

Food security is typically the top priority mentioned by the community when the organisation first engages.

“Many coffee growers don’t grow their own food because they’re so focused on coffee. We teach everyone – especially coffee growers – how to set up kitchen gardens. Often, these gardens produce so much that they can sell the excess. Plus, having diverse crops can help them weather downturns in the coffee market,” says Dr Schecter.

She adds that during the COVID-19 pandemic, the organisation successfully worked with coffee growers in Guatemala who were able to feed their families and even sell excess food using this method, and they did well financially despite the global economic downturn. Income diversification is also a key strategy.

“A lot of women are interested in raising poultry or small animals. In places like Peru’s Andes, guinea pigs are a delicacy and many women raise them. Other livestock and vegetable farming are common, and some people start small businesses, like running grocery stores or making handicrafts,” says Dr Schecter.

In Guatemala, for example, women often engage in embroidery and sell their work. Beyond that, Dr Schecter says World Neighbors teaches basic business skills and financial literacy, especially to women, as many may not have received formal education.

“It’s also about encouraging diversification to avoid the pitfall many coffee growers face. If a blight or price drop occurs, they can quickly find themselves in a dire situation. We want them to have a backup source of income,” she says.

The timeline for these training programs spans about eight to 10 years before World Neighbors ‘graduates’ a community. While the intensity of their involvement may vary over time, the team continues to monitor and support the communities throughout the process.

Dr Schecter adds that in some cases, word spreads to neighbouring communities who are eager to get involved, contributing to the organic growth of the programs.

“We have been successful at creating organic growth of our training programs into neighbouring communities. People hear about our work, ask to join our training programs, or help others get involved. We train farmers to become trainers themselves creating a network of local experts,” says Dr Schecter.

Rather than starting from scratch, World Neighbors leverages existing resources by collaborating with community-based organisations (CBOs) in the areas where it works. Upon entering a new community, the team identifies existing CBOs to partner with, and if none are present, they help establish one. These organisations receive small grants from World Neighbors to support training and implementation efforts.

Dr Schecter explains that in some countries such as Nepal, the government requires new NGOs to build on previous investments made in the area.

“We aim to avoid starting from scratch because there are often existing networks that can be tapped into,” she says.  “We assess needs, work with CBOs to identify leaders, and provide ongoing monitoring through local ‘social mobilisers’. These individuals, often volunteers, help us reach thousands of people each year and allow us to scale up our impact.”

One of the most notable changes Dr Schecter has observed during her tenure is the adoption of better farming practices by smallholders, including a cultural shift towards recognising the vital role of women in agriculture.

“More women are entering farming and small businesses. Even in conservative societies, women are learning to run businesses and becoming very successful,” she says.

“There’s also a shift in how communities view young girls. In the past, girls were often married young and isolated in their homes. But now, there’s greater awareness that early marriage is detrimental not just to girls but also to society as a whole.”

Level playing field

Meanwhile, international non-profit Fairtrade Foundation works to ensure fairer prices throughout the entire coffee value chain. Max Milward, Senior Sustainable Sourcing Manager for Coffee at Fairtrade, says the foundation is about reshaping the way trade operates so coffee farmers can take control of their lives, businesses, and communities.

“The Fairtrade system creates strong relationships, combining direct links between producers and buyers with third-party assurance. It encourages cooperatives to build multiple, direct relationships with different markets, reducing their dependency on just one buyer,” he says.

“Having access to market information and training in business and negotiation skills means cooperatives can negotiate directly and confidently with their buyers. Fairtrade also promotes long-term partnerships, which farmers highly value as they can predict their income, and plan and invest for the future, encouraging economic sustainability.”

According to Milward, the foundation has been able to make a notable impact through the implementation of two measures.

Firstly, the Fairtrade Minimum Price ensures farmers receive a fair and stable income by setting a safety net price based on production costs. The Fairtrade Premium is an additional fund that helps improve social, economic, and environmental conditions in communities, although many farmers still struggle to earn a living income despite these protections.

The Fairtrade Standards Committee, consisting of equal representation from producers and commercial stakeholders, makes the final decisions on price and Premium updates. This ensures the prices reflect the needs and realities of both farmers and businesses. Another measure, the Fairtrade Living Income Reference Price, is what a typical farming family needs to receive to be able to earn a living income. It factors in average household size, viable farm size, a realistic and sustainable productivity level as well as the farm investments needed to reach this target yield and pay hired workers a living wage. Living Income Reference Prices are voluntary commitments for Fairtrade buyers who want to assume more responsibility for enabling living incomes in their supply chains.

Milward explains that by paying the Fairtrade Minimum Price and Fairtrade Premium Price, businesses help offset low incomes for farmers, providing a buffer against climate change impacts and unforeseen economic shocks such as the COVID-19 pandemic.

“Across the years, coffee producers have used Fairtrade to help create a better future. They have built healthier, stronger, and more resilient communities, with improved choice and better life chances through access to healthcare and education. They have raised up their farms and their families in ways unimaginable before,” he says.

An example of a community that has directly benefited from the Fairtrade model is Asociación de Cooperación al Desarrollo Integral de Huehuetenango (ACODIHUE), a coffee-producing organisation founded in Guatemala in 1996 with support from the European Union (EU).

In addition to coffee, ACODIHUE members also produce honey, potatoes, and hibiscus tea, all of which are marketed under the La Meseta brand.

“ACODIHUE, through sales to local and international markets, hopes to continue to provide services and technical assistance to producers that will keep product quality at competitive levels in addition to developing social and economic programs that benefit farmers, their families, and the community,” says Milward.

ACODIHUE has used the Fairtrade Premium to develop a storage and distribution centre and water conservation initiatives, so now large amounts of water used in coffee washing processes are treated in filtration and sedimentation tanks to prevent pollution of water sources. What’s more, the Fairtrade Premium has also provided educational programs and scholarships for members of the cooperative.

Meanwhile, Cud Lie Mnong Fairtrade Agriculture Cooperative (CUDLIEMNONG) in Vietnam has used Fairtrade Premium funds for community development, infrastructure improvements, and direct support to increase productivity and quality since receiving Fairtrade certification in 2009.

Milward says research has shown that Fairtrade initiatives significantly improve the financial wellbeing and resilience of farmers and their communities, particularly during times of hardship.

The report, titled Assessing the Impact of Fairtrade on Poverty Reduction and Economic Resilience through Rural Development, revealed higher earnings, better safety nets, and increased savings for Fairtrade-certified farmers, with the average Peruvian household incomes of Fairtrade producers being 50 per cent higher than those of non-Fairtrade producers. Fairtrade farmers also registered an uptick in benefits across social wellbeing indicators, including gender equality and workplace safety and health, when compared with their non-Fairtrade counterparts.

“Women in Fairtrade cooperatives, for instance, showed more confidence in speaking up and voicing their thoughts. Similar advantages were noted on health-related issues,” says Milward.

He adds that long-term sustainability is crucial to securing resilient supply chains, and this is where initiatives like Fairtrade’s Shared ImPACT initiative can make a difference.

In December 2023, the Competition and Markets Authority backed Fairtrade’s Shared ImPACT initiative, which encourages UK retailers to collectively source more Fairtrade coffee and other commodities. Milward says this approach helps producers secure better incomes, more Fairtrade Premium, and greater power in supply chains, while businesses mitigate risks and invest in long-term sustainability.

“Our hope is the future will be one of greater collaboration,” he says, “even among competitors, so that fairer trading becomes the norm.” 

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