Coffee roasters' sustainable sourcing decisions and use of the Direct Trade label

Abstract

This paper analyzes motivations for coffee roasters to source directly from farmers and how roasters decide whether to use the Direct Trade sustainability label. Direct Trade is an uncertified label connoting an approach wherein roasters negotiate coffee price and quality with farmers without intermediaries, with purported farmer income benefits. We examine semi-structured interviews with 11 US roasters and three coffee stakeholders to identify motivations to source directly, provide customers sourcing information, and use or reject the Direct Trade label. We find that roasters directly source coffee primarily for quality reasons and communicate about sourcing because they believe customers would value coffee more if they understood their sustainable sourcing practices. However, the lack of a clear definition for the Direct Trade label, coffee roaster concerns about the label's utility, and the threat of "free riders" disincentivizes label use. Without a shared label, customers face high costs for information about directly sourced coffee, which may limit the expansion of a sourcing practice that could benefit farmers.