The booming Fairtrade industry is a hollow "marketing device", according to a top economic think-tank.
A report by the Adam Smith Institute says the work of the Fairtrade Foundation does not promote long-term economic development and leaves most third world farmers worse off.
"Fairtrade is a nice idea, and it is great that so many consumers want to help the poor in the developing world. But it is important that we ask whether Fairtrade really helps. After all, 'Fairtrade' does not mean anyone who gives better terms to third-world farmers. It is a particular brand, which competes with other ethical schemes and charities for people's money.
There are a number of inconvenient truths about Fairtrade. Indeed, on closer inspection it may not be that fair at all. It only offers a very small number of farmers a higher fixed price for their goods. Given the way markets work, these higher prices come at the expense of many other farmers, who – unable to qualify for Fairtrade certification – are left even worse off.
More importantly, the Fairtrade scheme does not aid economic development. It sustains uncompetitive farmers on their land, holding back diversification, mechanization and moves up the value chain. In doing so it denies future generations the chance of a better life.
The fact that will surprise consumers most, however, is that only 10 percent of the premium they pay for their Fairtrade products actually gets to the producer. The rest goes to people further along the retail chain.
Fairtrade's success rests on its skilful advertising and its ability to persuade corporations, schools, towns and even nations to 'go Fairtrade'. But when you look at the evidence it is clear that for all its good intentions, Fairtrade is not the only way to make a difference, and it is not the best way either."
You can download the whole report here as a PDF.
Of course to offer your guests non Fairtrade coffee down here in the bleeding heartlands of middle England is akin to admitting you keep a brace of picaninnies chained up in your basement for your debased pleasures. But truth must out.