He was also looking for more balance in his work-driven life. And so, after buying a coffee farm from a farmer he’d met on his earlier trip, he packed up his life and moved.
“It was like Swiss Family Robinson,” Mr. Lander jokes. “We just left.”
In Costa Rica, Mr. Lander, who is now 46, didn’t have to worry about making money. He had received a cash windfall from selling a portion of a residential subdivision he had helped develop in Georgia; the plan was to keep selling more lots and live off the proceeds. So he grew coffee for fun.
Then, in 2008, the financial crisis hit. The value of his subdivision plummeted. Suddenly, he had to support himself as a coffee farmer. Very quickly, he realized how difficult that was going to be. He had just 12 acres that produced 6,000 pounds of specialty-grade coffee beans a year.
He belonged to a “fair trade” co-op, which guarantees farmers a minimum price, but was making only $1.30 a pound on coffee that retailed in the United States for $12 a pound. His net profit was so low that at one point he was down to $120 that had to last two weeks.
“I was at the register debating whether or not to buy shampoo or a bag of rice,” Mr. Lander recalls.
Why wasn’t he seeing more of that final price?
That question has been asked by farmers throughout history, particularly in developing countries, where growers of commodity crops like coffee and cocoa often live in poverty. Over the last few decades, a worldwide movement under the broad banner of fair trade has tried to rectify that imbalance.
In exchange for receiving “fair” prices for their products, fair trade farmers must adhere to environmental and labor standards set by certification groups, the largest of which is Fairtrade International, a nonprofit organization based in Bonn, Germany. It represents 1.24 million farmers and workers in industries including coffee, bananas and honey.
But Mr. Lander started to think that he might improve on the idea. He began to experiment. Using a roaster he had bought in better times, he started roasting his beans and selling them on Facebook to friends in the United States. He also opened a coffee shop, called the Common Cup, in Monteverde, and sold his coffee to tourists.
When he ran out of beans, he teamed up with two other area coffee farmers, Jorge Fonseca and Alejandro Garcia — who also had a coffee shop, the Colibri — and began shipping greater volumes. Suddenly, he was making money.
This D.I.Y. enterprise led to the creation in 2011 of Thrive Farmers Coffee, which Mr. Lander started with Mr. Garcia and Michael Jones, an entrepreneur based in Atlanta. The company is still largely untested, but is built on the idea that farmers can “participate in the added value as coffee moves downstream to the consumer,” Mr. Lander said.
TYPICALLY, farmers sell their green, or unroasted, beans. At that stage, the beans generally fetch a price based on the commodity market price, which in February averaged $1.53 a pound for Arabica coffee, according to the International Coffee Organization.
The fair trade concept offers an improvement on that model. It will pay the market price for beans, but, importantly, it guarantees a minimum price — now $1.40 for Arabica coffee. In addition, the local co-op that collects and processes the beans keeps a premium, now 20 cents, which is used for social services like scholarships and health care for farmers and their families.
Theoretically, a fair trade farmer never loses, because when the commodity market price is higher than the fair trade price, the farmer receives the market price, and the co-op still receives the premium. But fair trade buyers purchase unroasted beans, and the processes that add to the price and value of the coffee come later.
Article source: http://www.nytimes.com/2013/03/17/business/coffees-economics-rewritten-by-farmers.html?partner=rss&emc=rss