Beyond fair trade: The benefits of building a direct relationship with coffee producers

Kahwei Yoong
August 24, 2021
picking coffee cherries from a plant

Of all a specialty roaster’s many responsibilities, without a doubt one of the most important is sourcing green coffee. Not only does it represent the cornerstone of any roastery, its quality and consistency will ultimately determine the success of the business.

However, a recent spike in the number of specialty roasters entering the market has made sourcing high-quality beans increasingly difficult. Where once a small handful of roasteries had the pick of the bunch, securing consistent, high-quality supply has now become somewhat of a challenge.

What’s more, as the specialty market develops and consumers take more interest in where their coffee comes from, concerns over the even distribution of profits have grown with ever greater intensity. 

Fair trade sourcing – an approach designed to support the livelihood of producers through a minimum price floor – has also been critiqued, with some questioning its ability to deliver quality.

As such, there has been a marked shift towards a direct trade model in recent years, centred on the idea that building a long-term relationship with producers can improve quality and develop ethical values in the coffee industry.

To understand more about building direct relationships with coffee producers, I spoke with co-founder of Khomanta Coffee Clint Helfers.

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holding up a single coffee cherry
Unlike Fairtrade, direct relationships are not regulated by any organisation

What is direct trade?

Direct trade is a process in which roasters buy coffee directly from farmers without the help of intermediaries.

Also known as “relationship coffee”, it is typically based on interpersonal connections, mutual trust, price transparency, and a commitment to quality improvement beyond a single harvest.

Unlike fair trade, direct trade is not regulated by a set of standards put in place by organisations like Fairtrade International. Instead, it relies on agreements made between the roaster and farmers, who decide on everything from price to delivery times.

“They greet you with open arms and share everything in their life with you.”

One of the central goals of direct trade is to create a more level playing field. Farmers often receive a relatively small percentage of profits when their coffee passes through many hands before it reaches the consumer.

This can make it difficult for farmers to elevate themselves from their positions, let alone improve their operations – despite specialty coffee’s relatively high market price compared to commodity coffee.

This is something Clint Helfers and his wife Haydee noticed after they started researching the industry prior to the launch of their roastery, Khomanta Coffee.

“We had a conversation with our friend who comes from a producer family about the reality of coffee producing and it made us switch from the mindset of just roasting coffee to wanting to figure out how to be a better sourcer of coffee,” Clint explains.

This kick-started what he describes as an “emotional adventure”, where the couple started meeting producers at origin. But it also made it clear that a direct relationship with the farmers was to be the core element of their business going forward.

“It is hard to put to words the experience of visiting the farms because the producers are just so happy and appreciative that you show any amount of interest in what they’re doing,” Clint says.

“They greet you with open arms and share everything in their life with you. For us, that experience was something we wanted to pass on to our consumers.”

direct relationship with coffee producer
Buying directly from producers can improve the way companies respond to their needs

Promoting quality and equality

Another central goal of direct trade is quality improvement. With other models of trade, there can be very little incentive to improve the quality of farming methods, not least because they lack the means to do so.

This is because, as Steven Macatonia notes in an article for The Guardian, the fixed price farmers receive from fair trade coffee “will not be affected by the quality produced so farmers are not incentivised to take on the extra labour and input costs needed to grow a better crop.”

With direct trade, on the other hand, roasters are able to identify the needs of the farmers and adjust their premiums accordingly. 

One of the ways Khomanta does this is via their profit-sharing programme: they agree to pay 30% of profits to the farmer so that they can reinvest it in their operations and improve their livelihoods.

“Coffee farmers work the hardest out of everybody in the whole chain, yet they benefit the least…”

As well as giving them a competitive edge, it incentivises the producers to improve their green beans quality since higher quality beans can command a premium price, which translates to better profit. 

“Coffee farmers work the hardest out of everybody in the whole chain, yet they benefit the least and have some of the hardest lives,” he says, “It’s unfair and it shouldn’t be that way.”

But it’s not just about quality: a direct relationship helps promote transparency and fairness. Once coffee is harvested, it is typically passed through hundreds of hands via a complex supply chain.

Farmers are usually oblivious to what happens to their coffee once it leaves the farm, often unaware of how their coffee even tastes. Being in direct contact with the producers allows roasters to provide updates and instant feedback to them. 

Ultimately, a direct relationship humanizes the producer-roaster relationship in which farmers are treated with the respect and fairness they deserve.

direct relationship with coffee producer
Some associations and cooperatives may be reluctant to share producers’ details

How to form and maintain a direct relationship

As the majority of coffee farmers are located in remote regions with limited cellular access and knowledge of direct trade processes, it can be difficult to make that initial contact. Instead, many of them tend to work in associations and cooperatives that roasters need to go through in order to establish a connection.

Clint shares that the biggest challenge when they wanted to start a direct relationship with coffee farmers was finding one of these associations that would not only respond to them, but was willing to put them directly in touch with the producers.

However, once they were able to make that happen, figuring out the other processes, such as importing and exporting, was relatively simple.

“When we started, we thought it was going to be impossible since we came into the industry knowing nothing,” Clint says. “But in our first year, we were able to export and import coffee. You too can work a lot closer with the producers than you think you can.”

Despite working through an association, Clint explains that they are in direct contact with the producers themselves. Coffee prices are agreed between Khomanta and the farmers, while Khomanta is also involved in the entire process, from logistics to payments.

In addition to working through a cooperative, roasters can also use social media to establish connections with producers. For example, many coffee brands share details of coffee farms on their websites.

“The most part of our relationship has been about treating our producers like a family member.”

They can try researching for the farm’s contact details; but if that isn’t possible, they can reach out to other green coffee buyers or roasters at origin to ask for an introduction to producers.

Once the producer-roaster relationship is formed, roasters will need to work on nurturing and maintaining the relationship for a fruitful collaboration.

Intelligentsia is one of the pioneering specialty coffee brands in direct trade in addition to other large-scale roasters, such as Stumptown and Counter Culture Coffee.

To drive and create lasting direct relationships, some of their principles include partnering with producers who share the same value, building quality through a shared commitment, and sharing not just rewards, but also risks.

But Clint tells me that, above all, it’s about treating producers with respect.

“The most part of our relationship has been about treating our producers like a family member,” he explains. 

“We have WhatsApp chats, photo exchanges, and regular phone calls with them; some of which are just friendly conversations and others are about the production side of things.”

sustainable coffee bags
Good quality packaging is key for showcasing the relationship you have with producers

Having a direct relationship with coffee producers is a gratifying exchange. You are able to serve quality coffee to your consumers, while knowing that the whole process will bring fair and positive impact to the coffee-farming communities.

At MTPak Coffee, we understand the hard work that both coffee producers and roasters do in creating great coffee.

Our high quality coffee packaging coupled with our dedicated design team can help tell the best story of your coffee, and at the same time, uphold the value of the relationship you have with your producers.

For information about our sustainable coffee bags, contact our team.

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