Starbucks Highlights New Café Estima Blend™ Fair Trade Certified™ Coffee in Celebration of Fair Trade Month October is national Fair Trade Month in the U.S. This year marks the second annual event, hosted by TransFair USA—the nation’s only independent, third-party certifier of Fair Trade products. The event is designed to bring attention to the critical social and economic issues faced by coffee farmers and to promote awareness and purchase of Fair Trade Certified™ products.

In celebration of Fair Trade Month, Starbucks is pleased to announce the launch of Café Estima Blend™, a new Fair Trade Certified™ addition to Starbucks coffee line-up. To introduce customers to the new blend and highlight the Company’s broad commitment to ensuring coffee farmers receive a fair price for their coffee, Starbucks will feature Café Estima Blend™ as "Coffee of the Week" in its North America stores during the week of October 10-16.

Following its introduction, the new Fair Trade Certified™ blend will be brewed on a quarterly basis as "Coffee of the Week" in thousands of participating Company-operated stores across the United States and Canada. And, in North America on any day throughout the year, customers can enjoy the velvety smooth and balanced flavor of Café Estima Blend™ by the cup upon request or by purchasing it by the bag in whole bean or ground. In addition to offering Café Estima Blend™ in Company-operated and -licensed locations throughout North America, Starbucks now provides five different Fair Trade Certified™ offerings for its Foodservice customers, including college campuses, restaurants and hotels. Additionally, licensed stores and Barnes & Noble cafés serving Starbucks® coffee on U.S. college and university campuses will have the opportunity to serve Café Estima Blend™ on a daily basis as one of several featured conservation and/or certified coffees beginning this fall.

"TransFair applauds Starbucks introduction of Café Estima Blend™ and its decision to expand availability of its Fair Trade Certified™ coffee offerings," said Paul Rice, founder and CEO of TransFair USA. "These initiatives will expose more consumers to the great taste of Fair Trade Certified™ coffee and will also help Fair Trade farmers around the world maintain a decent standard of living."

Starbucks formed an alliance with TransFair USA in April 2000, and has since become one of North America’s largest roasters and retailers of Fair Trade Certified™ coffee. This year, Starbucks will purchase 10 million pounds of Fair Trade Certified™ coffee, representing approximately 25 percent of all Fair Trade Certified™ coffee imported into the United States. In 2006, Starbucks plans to purchase 12 million pounds of Fair Trade Certified™ coffees.

Purchasing Fair Trade Certified™ coffee is one of several ways Starbucks seeks to ensure the economic stability of small-scale coffee farmers. Starbucks is committed to purchasing all of its coffees in a socially responsible manner and has developed an integrated approach to support this effort. This approach includes paying premium prices to help coffee farmers make profits and support their families; encouraging participation in C.A.F.E. Practices (Coffee and Farmer Equity Practices), a set of socially responsible coffee buying guidelines; providing access to affordable credit to coffee farmers through various loan funds; investing in social development projects in coffee-producing countries; purchasing shade-grown and certified organic coffees; and collaborating with farmers through the Farmer Support Center in Costa Rica to provide technical support and sustainable agricultural training.

Starbucks is excited to offer customers Café Estima Blend™ as part of our regular coffee line-up. We invite you to share in our commitment to coffee-growing communities by visiting Starbucks and tasting Café Estima Blend™ or any of our other coffees.

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Renovating a Legendary Reputation for Quality
    --Text and photo by Jonathan B. Levine

Cooperativa Café Timor remakes the coffee industry of tiny East Timor and empowers a nation of subsistence farmers.

East Timor, the tiny island nation of peasant farmers north of Australia, has been exploited for 400 years—first by Portuguese colonizers and later by Indonesian occupiers. But in the last decade, a farmer-owned cooperative has accomplished what centuries of colonial rule could not: From a dismal living of hand-processing inferior coffee, the 17,600 families of Cooperativa Café Timor (CCT) now mass-produce specialty grades sold around the world—with a growing portion under the Fair Trade labeling system. Since the beginning, Starbucks Coffee Company has consistently bought at least half of CCT’s production at 30 percent or more above market rates, and supported community developments such as a network of rural health clinics and water systems.

CCT, initially backed by U.S. government funding, has virtually reinvented Timor’s coffee trade. Farmers used to depulp and wash coffee cherry by hand into partially processed “parchment,” typically over-fermenting and destroying its flavor. By controlling processing through centralized mills and drying fields, CCT unleashed the distinctively smooth flavor of the local Hybrido de Timor bean, restoring the country’s former reputation for quality at vastly increased prices. This year, Starbucks replaced the Java component of its Arabian Mocha Java blend with CCT coffee and renamed it Arabian Mocha Timor, with momentous implications for Timor farmers: “As long as we can keep up our volumes and quality, Starbucks confidence in us means we’ll never suffer from low coffee prices again—it’s that important,” says Sam Filiaci, an American who founded and manages CCT.

Farmers like Tiago Martins bear witness to the CCT strategy. The 45-year-old father of nine barely made ends meet when he harvested and marketed his own parchment. But since CCT began processing his cherry, he has earned far more cash for less labor—between $800 and $1,000 in recent years, or four times the national average family income. High inflation still means a subsistence corn-and-rice diet for his family, but he can now afford to send his six younger children to school, and he has replaced his grass roof with more durable aluminum. The entire family also receives free medical care from CCT clinics. “I couldn’t say our life is good, but we have many changes for the better,” Martins says.

CCT’s health clinics, paid for mostly out of Fair Trade price premiums, are a key benefit for co-op families. East Timor suffers some of the highest rates of infant mortality and maternal childbirth deaths in the world, and CCT’s network of 11 free primary-care clinics and 27 mobile stations provide the only defense against such threats in Timor’s coffee regions. The clinics got started in the late 1990s when CCT asked Starbucks for a construction grant. But the Indonesian army’s occupation of Timor at the time was putting activist heat on the Company’s high profile in the country, and an outright grant would have been risky. In its eagerness to support the dire social need, Starbucks instead built extra funds into the coffee prices it paid and avoided scrutiny of potential objectors. That kind of unfailing support of suppliers is one reason Filiaci says CCT is basing its future growth on Starbucks now more than ever.

About the story
This story is one of a series intended to explore Starbucks relationship with coffee farmers, as well as to identify issues, lessons, and opportunities that result from these business relationships. Mr. Levine was asked to put his journalistic and analytical skills to work at coffee farms in a dozen countries and on three continents. To view videos of these stories, please visit www.closeupproductions.com/coffeestories/.

About the author
Jonathan Levine is an independent researcher, analyst, consultant and writer on international development, with emphasis on global corporate social responsibility initiatives and cross-sector partnerships. Mr. Levine is an award-winning journalist with more than 15 years of experience in the U.S. and Europe, and has written about information technology, pharmaceuticals, corporate strategy, finance and industrial policy. Mr. Levine served as European Technology Editor, San Francisco Bureau Chief and Staff Correspondent for Business Week Magazine, West Coast Bureau Chief for Venture Magazine and was Managing Editor for Today's Business Magazine.

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Starbucks Hosts First European Stakeholder Summit in Lausanne, Switzerland On June 13-14, 2005, Starbucks hosted its first European stakeholder engagement session in Switzerland, facilitated by SustainAbility, an international think tank focused on sustainable development. While these feedback sessions are not a new initiative for the Company, it was the first time Starbucks brought together nongovernmental organizations, policy makers and trade groups—representing a multitude of interests and perspectives—from throughout Europe to participate in an open dialogue session with Company executives to discuss Starbucks business practices and Corporate Social Responsibility (CSR) programs. Additional focus areas for the dialogue were global issues that may have an effect on the coffee industry as a whole, such as industry collaboration, equity for coffee farmers, climate change, coffee quality and the environment.

The objectives for the event were to share with attendees Starbucks current CSR activities and initiatives, including C.A.F.E. (Coffee and Farmer Equity) Practices; identify key sustainability issues for Starbucks to consider in Europe and within its global operations, including coffee supply chain; and seek input in the development of Starbucks CSR strategy going forward.

During the two-day event, participants shared a broad variety of unique perspectives and insights, as well as research and recommendations. Discussion and brainstorming around a variety of key issues included integration of CSR into all Starbucks international operations; enhanced emphasis on environmental sustainability and resource conservation; consumer education and communications; supply chain price transparency; and policy development and partnerships, to name a few.

The session took place in Lausanne, Switzerland, home of Starbucks coffee buying office, Starbucks Coffee Trading Company (SCTC), to give participants a firsthand look at the intensity and care that the Company takes in buying its coffee. Starbucks purchased nearly 300 million pounds of coffee in fiscal year 2004, which underscores the Company’s need to continually balance social responsibility, efficiency and strong business relationships with coffee farmers. Participants at the Lausanne event were taken through an extensive coffee cupping, a process where all the coffees are tasted to determine taste and quality in order to provide context for the complex and precise job of buying coffee. They also participated in discussions on Starbucks socially responsible buying practices (C.A.F.E. Practices), the Company’s Fair Trade strategy, conservation initiatives and more.

Event attendees included representatives from CSR Europe, Oxfam UK, Max Havelaar Switzerland, World Economic Forum, African Wildlife Foundation UK, NOVIB Netherlands, European Institute for Business Ethics, World Wildlife Fund International, Neumann Group, Fairtrade Foundation UK, International Trade Centre of the United Nations Conference on Trade and Development (UNCTAD), World Trade Organization (WTO) and the Institute of Business Ethics, UK.

Senior leaders from Starbucks including Sandra Taylor, senior vice president, Corporate Social Responsibility; Cathy Heseltine, vice president, Marketing & Category EMEA (Europe, Middle East & Africa); Geert van Kuyck, vice president, Marketing EMEA; and Alain Poncelet, managing director, Starbucks Coffee Trading Company (SCTC) were actively involved in the dialogue, as well as a number of other Starbucks representatives from the U.S. and Europe.

While the session represented Starbucks first formal multi-stakeholder engagement event in Europe, it certainly is not the last. Starbucks plans to continue to engage with stakeholder groups on a variety of topics in the coming months and in future dialogue sessions, and is committed to communicating to participants any decisions that resulted from the Lausanne meeting. Following the summit in Lausanne, Starbucks provided all attendees with a summary report of discussions conducted during the forum.

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