Lee Byers is Fairtrade International’s Senior Advisor, Coffee and Tea with the Global Product Mangement team
As global Senior Advisor for Fairtrade tea and coffee, I am often struck by the difference in these two sectors. Generally speaking, the tea sector is very well established with good long term demand and in recent years, has achieved good prices for bulk-made tea. Tea is also largely an all-year-round, weekly crop with a relatively stable supply base. Market prices are also somewhat predictable driven by physical supply and demand of made tea.
In contrast, coffee is a seasonal, annual/bi-annual crop, requiring high investment/working capital while market pricing is highly volatile, dictated by a global NYC commodity price, driven by physical availability but also increasingly commodity speculation, creating high uncertainty and price risk. One of the key reason’s Fairtrade offers small coffee farmers a minimum price (US$ 1.40 per lb) plus an additional Fairtrade Premium (20 cents per lb) versus a current NYC price of around $1.33.
On this basis, the tea sector looks in good shape, but beneath the surface there are a number of structural weaknesses which must be addressed if we are to have a sustainable tea future. After 30 years of enduring low profitability, many tea growers have struggled to make sufficient investments in infrastructure and labour welfare, so there is a compelling need for change.
The Oxfam tea wage report, published today is therefore a timely and helpful contribution to a wider industry debate as to how we can improve worker welfare and move toward a living wage. As the Fairtrade International representative on the steering committee for this report, I have been privileged to help shape the scope and design of the study as well as facilitate key meetings with industry experts. While the results are indeed challenging, they are perhaps a spur to action for everyone on the tea sector, recognising that enduring solutions cannot be delivered by Fairtrade alone.
This week, I attended the second in a series of workshops hosted by Forum for the Future as part of the Tea 2030 project. While we are some way yet from finding solutions to complex sustainability issues, I am encouraged to find myself alongside representatives of major tea brands, retailer’s NGO’s, industry bodies and tea boards from around the world.
Fairtrade is not alone, the journey has begun and together I think we can begin to make a real difference to tea workers, their families and communities through a vibrant and sustainable tea industry.
Take a look at the recent Malawi study conducted by NRI University of Greenwich, which examines Fairtrade tea Premium impacts for workers and farmers.
Read Fairtrade International’s response to the Oxfam-Ethical Tea Partnership report.