P&G rejects 'fair trade' coffee, favors direct aid

P&G rejects 'fair trade' coffee, favors direct aid

Thursday, October 11, 2001

SEATTLE POST-INTELLIGENCER STAFF AND NEWS SERVICES

CINCINNATI -- Procter & Gamble Co. is resisting the decision of some companies to sell coffee that returns more profits to growers. Instead, P&G prefers its tradition of helping poor communities where the coffee is grown.

P&G, an industry leader with $1 billion in annual coffee sales through its Folgers brand, says its operations in coffee-producing countries have raised millions of dollars to support education programs, build or remodel schools and donate computers to schools. The company produces coffee in countries ranging from Brazil, Venezuela and Mexico to Thailand and China.

P&G spokeswoman Margaret Swallow said the company believes direct assistance to growers' communities and schools is more effective than selling what is called "fair trade" coffee.

"'Fair trade' coffee is just one element," Swallow said. "If you look at the big picture, there are a lot of ways to do it."

But an activist urging P&G to sell "fair trade" coffee products said yesterday that she thinks it helps growers work their way out of poverty.

Deborah James, "fair trade" director for the San Francisco-based human rights group Global Exchange, said she is waiting for P&G's response to the request she made at its annual shareholders meeting Tuesday.

Procter & Gamble owns Millstone Coffee, which was based in Everett in 1995 and is now based in Cincinnati.

Sara Lee Corp., whose coffee brands include Chock Full o' Nuts and Chase & Sanborn, began offering "fair trade" coffee earlier this year, James said. Starbucks Coffee Co. began selling it a year ago.

P&G and Kraft Foods, which sells Maxwell House, haven't warmed up to the idea, and activists pushing the cause have a tall order.

Less than 1 percent of the coffee sold in the United States is of the "fair trade" variety. An annual survey this year by the National Coffee Association found low awareness of what "fair trade" coffee is.

"Fair trade" organizations say they bypass middlemen and deal directly with coffee growers, to reduce costs and return a greater percentage of the retail price to producers.

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