Purchasing at outright prices
By purchasing coffee at negotiated outright prices, independent of the prevailing market price for commodity-grade coffee, Starbucks can help provide stability and predictability for coffee sellers. We purchase the majority of our green coffee at outright prices – 74% in fiscal 2002.
Building direct relationships with farmers
One of our priorities is to establish more direct relationships with farms and co-ops we know and trust. Purchasing directly from farms, with the assistance of a third-party facilitator, delivers more of the purchase price to farmers. In fiscal 2002, 32% of our total green coffee supply was purchased through direct relationships at negotiated prices.
Signing long-term contracts
Given the current economic climate, farmers prefer to know they have buyers for future harvests and income they can count on. By signing long-term contracts with these farmers, Starbucks is able to ensure our future coffee supply – and at predictable prices for Starbucks and farmers – over several years. (The typical contract runs for three to five years.) In fiscal 2002, 36% of our total coffee supply was purchased through long-term contracts.
Through Starbucks relationships with organizations such as Conservation International and Fairtrade Labelling Organizations International, we purchase Conservation (Shade-Grown) Coffee and Fair Trade Certified Coffee. Click on the links to learn more about these programs.