A Free Trade Taste of Success
Bridging on the successes of the Fair Trade movement, five independent coffee farming cooperatives in five countries have incorporated to bring U.S. consumers their first farmer-direct roasted coffees. Perhaps most notably, the first farmer-direct, organic, roasted coffee brand—Pachamama Coffee—represents 150,000 co-op owners from family farms in Peru, Mexico, Ethiopia, Nicaragua and Guatemala.
“Really we’re in a different category,” said Thaleon Tremain, Pachamama Coffee Cooperative’s U.S.-based General Manager, from his office in Davis, California. “ We’re more like Organic Valley, using the Organic Valley model for coffee farmers, than the fair trade model.” After five long years of developing their structure, the fruitful results of a collaboration between leaders of the farmer cooperative La Central de Cooperativas Agraria Cafetalaras (COCLA) of Peru and U.S. cooperative organizers are still blossoming as more and more grocery cooperatives, including the Willy Street Co-op, begin offering Pachamama Coffee single-origin coffees in our stores. Thaleon discussed the response from the farmer-owners of COCLA when they began discussing the potential for a U.S. venture. “They were looking for strong roots and strong leaders,” he said in a recent interview. “[This] was a logical extension of them to eventually get into this end of the business, to sell the branded coffees.”
After their initial meetings in 2000, Thaleon and the COCLA leaders concluded that developing a wider selection of coffees from multiple regions would be better able to appeal to customers in the United States. So, four more cooperatives were enlisted to join the umbrella organization, Pachamama Coffee Cooperative. Those cooperatives, Prodecoop (Nicaragua), Manos Campesinas Co-op of Quetzaltenago (Guatamala), and La Union Regional de Huatusco (Mexico) and OROMIA Coffee Farmers Cooperative Union (Ethiopia) in addition to COCLA, all shared a long history of growing quality coffee using traditional and sustainable methods.
With respect to the many Fair Trade coffee importers and related support organizations who’ve helped to secure each of the cooperative’s infrastructures over the last several decades, Pachamama Coffee owners acknowledge the role the Fair Trade movement has had in enabling the individual cooperatives to cultivate and retain stable, organic growers and growing conditions in each of their countries. The Pachamama Coffee brand represents a diversification for these farmer cooperatives that will continue selling their green coffee beans to the same Fair Trade importers who fostered their growth.
Though the obvious inclination for consumers might be to look at the structure of this company, Thaleon says, “A lot of the farmers want to get back to talking about the coffee and the quality, because when they don’t talk about that and they talk about what’s fair and what’s not fair, and livable wages, they’re really talking about charity, you’re buying coffee for other reasons.” Enthusiastically, Thaleon pointed out, “They have some of the best coffee in the world. Let’s not forget that. They’re bringing you the best of their crop.”
Speaking about his cooperative, COCLA, Petronio Meza Aquip, an organic coffee farmer from Santa Teresa, Perú said, in an interview available on the Cooperative’s website (www.pachamama.coop), “For us, the most important thing is to produce quality coffee because we believe consumers are satisfied knowing they drink a coffee worth the effort.” Later, in the same videotape at his farm, Petronia stated, “As farmers and members, the cooperative is very important to us. COCLA gives us the opportunity to serve the export market by providing quality control and processing our coffee for export. This way we can continue to educate our children, provide for their health, and make for a better living standard—for these reasons the cooperative is most important to farmers now.”
As part of their commitment to bringing the finest coffees to market, each individual cooperative selects their best beans among the regions of their country to represent them in the single-origin coffees that Pachamama Coffee sells. After cooperative owners wash and dry the beans, they are shipped to the United States to their stateside roaster, Taylor Maid Farms in California, an organic and Fair Trade roaster. The finished coffees are then distributed directly to stores.
However, the challenge of financing for this new cooperative has been there since the beginning. Thaleon explained, “For us it was hard because: one, we’re a co-op; and two, we’re a unique and different one; and three, mainly our owners or members are poor. They don’t have cash. So, in fact what they started Pachamama with was coffee and they still do, that’s their primary way of investing in this because they don’t have money, but they can invest their coffee for a year or two before [the cooperative] can pay them back,” he concluded.
So, in 2001 with that challenge at hand, organizers began working to secure start-up monies here in the United States. Critical funding was eventually secured with awards from the Sollars Fund, Cooperative Development Foundation and Information for Development Fund grant programs to conduct the needed market research and pay for the cooperative’s incorporation expenses. Nearly six years after their initial meeting, the first farmer-owned, organic roasted coffee was finally made available at U.S. grocery cooperatives in 2006.
Once the cooperatives began working together to structure Pacha-mama Coffee, it took several years for them to agree on some of the details, but there were some things that came more naturally. Thaleon explained, “They were very adamant that this business had to be organized as a cooperative. We were happy to hear that, but they did have some interesting takes on that; they made changes to the bylaws and so forth, so in the very beginning we’ve never had any control in this.”
As it is with most cooperatives around the world, each cooperative elects one of their own to serve on the Pachamama Board of Directors that meets annually in May to conduct official business of the cooperative. Eventually, when Pachamama Coffee begins to see a return on their immense investments, their bylaws support the practice of dividing the profits as a percentage of the sales to provide dividends to their owners. Thaleon added, “We’re right around the break-even point. They expect to have profit next year.”
Cooperative coffee drinkers everywhere are toasting this new and exciting cooperative and wish them the best of luck in their venture to gain a more significant portion of profits from their beans sold in the U.S. While summarizing the hard work and substantial investments the farmers have made to create this cooperative, Thaleon concluded, “It’s significant; they control their own destiny; they’re price-makers now; and they control the relationship with the consumer, or at the very least with the retailer.”