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Fair Trade, Direct Trade, and Micro Lot Coffee: What's What?

With consumers becoming more conscious about what they purchase, and where and how exactly those products were made, this has led to the rise of more industry labels and terms, such as ‘organic,’ ‘eco friendly,’ and ‘artisan’ to name a few. When it comes to coffee, there are a few such terms that you may have heard which sound fancy, but you’re really not sure what they mean, and if these labels even matter. There are namely three terms, which we will define today—fair trade, direct trade, and micro lot coffee.
Fair Trade Coffee First, Fair Trade USA is a non-profit organization that certifies goods like coffee and sugar, as an indication that strict production standards have been met. These were established to ensure that individuals, like farmers, involved in the production process are treated and compensated fairly.
To produce fair trade coffee, coffee farmers are paid a set amount based on the current world average price. The fair trade model ensures that they receive safe working conditions and fair wages. Sustainable farming methods are used, thus eliminating chemical use, and encouraging protection and upkeep of the environment.
Since farmers receive a fair price for their harvest, it allows them to invest in their families’ health care and education, and even build their communities.
Direct Trade Coffee Direct Trade does not refer to a specific certification or organization. Rather, it describes the relationship between the farmer and the coffee buyer. In the Direct Trade system, coffee roasters purchase product straight from the growers, eliminating extra buyers and sellers in the middle. This allows roasters to develop those direct business relationships with growers.
Unlike the Fair Trade system, in Direct Trade, coffee farmers are compensated based on the quality of their product. Therefore, the higher the quality, the more the farmer is compensated. This encourages coffee farms to continually improve their crops. In this system, farmers are paid up to 300% higher wages than Fair Trade, establishing employment stability, which is obviously beneficial to the wellbeing of the farmers and their families. This effective system also ensures complete transparency throughout the whole process, securing fair prices for the farmers, and a high quality product for the consumer.
Micro Lot Coffee Micro lot coffee indicates that it comes from a very small area, and the exports aren’t mixed with the rest of the country’s coffee farms. When farmers are growing their crop, they may notice that there are certain spots of their farm where coffees grow exceptionally well. This could be due to soil conditions, altitude, climate, or any of those conditions. These sections are called micro lots, and as we said, they are sold separately from the rest of the crop.
Because of the extra labor involved in sorting and classifying the coffee, microlot coffees are often purchased at a premium, causing a hike in the shelf price. These coffees are known to have rare qualities, and unique tastes. Microlots may come from one farmer or from a small estate or cooperative.
The next time that you hear these three terms used in coffee discussions, you’ll have a much better understanding of how to correctly use each one. At CoffeeAM, we are proud to carry fair trade, direct trade, and micro lot coffees from all over the world, as well as a wide range of gourmet and flavored coffees sure to please your palate any time. To learn even more about the coffee industry, and become an even smarter coffee consumer, please visit us here at CoffeeAM!
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