A few dozen chanters have gathered on the sidewalk in downtown Seattle one recent morning, outside Symphony Hall. Inside the auditorium, executives of the Starbucks chain are holding their annual shareholders meeting. They're celebrating the fact that the company's stock has tripled in value in the past five years. But these protesters, who represent the Organic Consumers Association, are threatening to pop the company's bubble.
"Now I want to hear everybody singing," one protester shouts into the microphone. "We shall not be moved ..." Others wave their placards, with slogans like "No to coffee sweatshops."
Early last year, not long after riots almost shut down the World Trade Organization meeting in Seattle, a group of activists from an organization called Global Exchange went to Starbucks and said, in effect, "Either start selling Fair Trade coffee or we'll boycott all of your stores." A few days before the boycott was supposed to begin, Starbucks executives basically said, "OK, we'll do it." And in fact, Starbucks began carrying Fair Trade coffee in cafes across the country; company officials say they're planning to launch a national campaign soon to promote it.
But leaders of the Organic Consumers Association charge that Starbucks is making only a "token" commitment to Fair Trade. They say Starbucks executives are trying to snow consumers with a public relations gimmick.
"I was at Starbucks this weekend," one protest leader shouts into the microphone, "and the Fair Trade coffee was tucked away in the back, almost out of sight. Did Starbucks ever intend to comply?" The demonstrators beat drums and boo. Now some consumer activists around the country are threatening to resume their calls for a boycott—unless Starbucks sells a lot more Fair Trade coffee.
The chief executive officer of Starbucks, Orin Smith, says the activists' charges are nonsense. We talk in his office, which looks out at Seattle's entire skyline and down on the city's bustling harbor. Smith says he supports the Fair Trade philosophy, partly because it feels like the humane thing to do. He's visited coffee country. He says he's seen that hardly any of the money that Starbucks pays for its beans ever trickles down the industry chain to the farmers.
"The hardest thing to see are the little kids," Smith says. "There's not a lot for them to look forward to. The people in these countries are challenged to feed themselves, to clothe their families, to give them any kind of an education. This is an incredibly marginal existence that these people live. And I think that anyone who sees that kind of a situation has to be really torn."
Smith also says he supports the Fair Trade idea partly for business reasons. He says small family farmers—not big plantations—produce roughly 80 percent of the coffee that Starbucks buys. If the farmers can't make a living and stop growing beans, what'll happen to Starbucks?
So it might sound contradictory when Smith concedes that the protesters do have a point. He says it's true: Starbucks buys a miniscule amount of its coffee from the Fair Trade system—less than 0.1 of 1 percent of all the beans that Starbucks buys. But, he says, don't blame the company for that. Smith says the problem is that Fair Trade activists are trying to sell coffee that's not always very good. He says Starbucks planned to buy—but then rejected—some shipments of Fair Trade coffee last year, because the beans didn't meet Starbucks' quality guidelines.
"And I would challenge [the Fair Trade activists]," he says. "They provide us with the quality of coffee that we're looking for instead of blowing their horns, we'll take it. There is no logical reason why I would turn down Fair Trade coffee. That makes no sense, because I have no motive."
Some Fair Trade organizers concede that Smith has a point: They do have problems with quality. Producing great coffee is something of an art, and they say some Fair Trade farmers are still learning how to wash the beans after harvest and then ferment them and dry them just right, so they develop that "deep flavor." But sources in the coffee industry also speculate that Starbucks makes smaller profits selling Fair Trade coffee than selling its regular brands, and perhaps that's why the company is dragging its feet.
Smith denies it. He says the company makes virtually the same profit, whether it sells beans stamped "Fair Trade" or not.
In a way, all this sounds like the debate you used to hear in the supermarket industry about organic vegetables. The best organic farmers grew great-looking lettuce; the worm-eaten stuff made executives cautious.
Still, the Fair Trade philosophy is slowly joining the mainstream. Almost a hundred companies have begun selling small amounts of Fair Trade coffee in the United States—including some Safeway supermarkets and Sara Lee, the company that sells old-fashioned brands of coffee like Chock Full O' Nuts. Sara Lee has just started offering Fair Trade coffee to institutional clients, such as government agencies, college campuses and hospitals.
Meanwhile, stores in Europe are selling Fair Trade bananas and tea and sugar. Coffee is just the beginning.
