When it comes to coffee, no two words have been as important as “direct trade” and “fair trade” over the past decade. From where it's grown to how its supply chain works, many coffee drinkers are now conscious of the origin of their coffee.
As these terms have become more popular, their meaning has started to get muddled. Let's explore the difference between these buzzwords so you can make informed decisions when buying your favorite beverage!
Direct trade and fair trade are essentially two different types of trading.
What is direct trade?
Direct trade refers to a process in which coffee roasters get their beans directly from the farmers. There is a strong focus on establishing a direct and long-term relationship with the farmers where all parties get a fair deal and the delivered product is of top-notch quality. The price paid for the beans is higher than what the coffee farmers would get working with more middlemen traders.
To ensure a high-quality end product, the farmers grow the beans sustainably and in better working conditions.
Direct trading implies, that in the end, coffee farmers benefit from better terms and coffee lovers have easier access to the world's best quality coffee beans.
What is fair trade?
"Fair trade" has evolved from niche criteria that not all coffee brands offered to a crucial benchmark for the coffee industry.
With fair trade farmers sell to middlemen traders, usually a cooperative, who are in turn responsible for selling to coffee buyers and roasters in exchange for an honest price; a guaranteed minimum price per kilogram above the fairtrade price.
The cooperative usually sets a small amount of the sales aside into a communal fund for both farmers and workers. This communal fund can be used for education, healthcare coverage or other social services. Seeing a fair trade label on any product also implies that no children were put to work to produce that product.
Because the beans have passed more hands before ending in your cup, it typically makes the end product -your cup of coffee- a little bit more expensive.
Is one better than the other?
Direct trade is often seen as a more ethical way to trade because it cuts out the middlemen and generally the farmers get a better deal. It's also more beneficial for roasters since they have more say when it comes to the quality and type of the coffee beans they're buying. This is one of the main reasons, if not the most important, why we trade directly at Belvico.
However, fair trade also has benefits because it helps to support sustainable farming practices, focuses on paying workers an honest price, provides social and health services and strives for good manufacturing practices.
In the coffee world, direct trade is also known as "beyond fair trade coffee" because it exceeds the fair trade requirements. It's ethically sourced, of higher quality, and meant to encourage closer connections between roasters, buyers and farmers.
How do we do direct trade at Belvico?
Without even realizing it, Belvico was engaging in direct trade from the start! Our director and co-founder Linh comes from a long line of local coffee farmers where this way of trading is the natural way of doing business. We simply prefer working straight with our farmers so we can ensure that everyone involved is treated fairly and receives their fair share of the profits.
Because traditionally coffee was mainly sold for industrial use - i.e. producing instant coffee - farmers were paying more attention to quantity rather than quality.
Engaging in direct trade enables us to control the quality of our beans throughout the entire process: from bean to cup*. For us, quality trumps quantity on any given day and so we worked hard on educating our farmers to reach the quality we envisioned and switching this quantity-focused mindset.
The result? You get to enjoy the highest quality of Robusta and Arabica in your home. Choosing Belvico beans always means you choose premium-quality coffee.
At Belvico, we love that our customers care about where their products come from and how they are made because we care about this too. Every time we spend money, we give our vote to a person or business.
With your support, we are co-creating a more sustainable world. Shopping at Belvico means you give back to our local coffee farmers whilst enjoying the authentic flavours of premium quality coffee from the Vietnamese highlands.
More questions about our production process? Contact us, email@example.com we're always happy to chat.