Starbucks Coffee Company, a US-based coffee retailer, recently announced that it would commit an additional USD 30 million to its Global Farmer Fund program, one of the organization’s “ethical sourcing initiatives” that aims to ensure the sustainability of the organization’s production chain up to 2020. Starbucks had initially committed USD 20 million to this program when it began in 2008 . Specific information on the planned usage of the funds is not publicly available.
The fund distributes loans to coffee farmers in collaboration with Root Capital, a US-based nonprofit social investment fund, and Fairtrade Access Fund, an affiliate of German non-governmental organization (NGO) Fairtrade International that provides loans to farmers in developing countries .
Craig Russell, the Executive Vice President of Global Coffee for Starbucks, said that the aim of the program is for coffee farmers to “have the ability to make strategic investments in their infrastructure, offering the stability they need to manage ongoing complexities so that there is a future for them and the industry”. Liam Brody, Senior Vice President of Root Capital, added that “the farmers need to pay interest of 10 percent on loans through which about 1-3 percent are returned to the investors”.
As of 2014, Starbucks reported total assets of USD 10.8 billion. As of 2015, Starbucks reports that the financing under the Global Farmer Fund program has helped 62 cooperatives in 8 countries, aiding approximately 40,000 farmers. As of June 30, 2015, Fairtrade Access Fund reported an investment portfolio of USD 10.2 million in loans to cooperatives in Latin America. As of 2014, Fairtrade International reported total assets of EUR 6.98 million (USD 7.77 million). As of 2015, Root Capital reported total assets of USD 135 million, an outstanding balance of USD 107 million, cumulative loan disbursements of USD 869 million and 586 borrowers.
By Hye In Arielle Oh, Research Associate
About Fairtrade Access Fund
Fairtrade Access Fund was launched in 2012 by Fairtrade International, a nonprofit based in Bonn, Germany; the Grameen Foundation, a US-based nonprofit; and Incofin Investment Management, a Belgian for-profit microfinance investment manager. The Fund distributes long-term loans to Fairtrade-certified, proficiently-managed farmers’ cooperatives and associations for the purpose of improving their processing facilities. As of June 30, 2015, the fund reports a portfolio of USD 10.2 million in loans to cooperatives in Latin America and has plans to expand to Africa and Asia.
About Fairtrade International
Fairtrade International is a nonprofit association based in Bonn, Germany, that consists of 28 members including producers, traders and external experts involved with three producer networks – Coordinator of Fairtrade Latin America and the Caribbean (CLAC), Network of Asian Producers (NAPP) and Fairtrade Africa. The foci include setting international standards for trade in an effort to endure that farmers are paid fairly for their products and labeling products to assist consumers in supporting this goal. As of 2014, Fairtrade International reported total assets of EUR 6.98 million (USD 7.77 million).
About Root Capital
Root Capital is a US-based nonprofit social investment fund that was founded in 1999. It provides capital, financial education and market connections to small businesses in 30 countries in Latin America and Africa. As of 2015, the organization reported total assets of USD 135 million, an outstanding balance of USD 107 million, cumulative loan disbursements of USD 869 million and 586 borrowers.
About Starbucks Coffee Company
Starbucks Coffee Company is based in Seattle, Washington, and was established in 1971. Since that time, it has expanded its operations to 65 countries. Starbucks mainly offers hot and cold beverages, whole-bean coffee as well as instant coffee, full-leaf teas, pastries and related merchandise. As of 2014, Starbucks reported total assets of USD 10.8 billion. Through the Global Farmer Fund, Starbucks is committed to distributing a total of USD 50 million by 2020 to coffee farmers. As of 2015, the company reports that financing has been disbursed through this fund to 62 cooperatives in 8 countries, aiding approximately 40,000 farmers.
Sources and Additional Resources:
 Starbucks Newsroom: “Starbucks More Than Doubles Global Farmer Loan Commitment to $50 Million,” https://news.starbucks.com/news/starbucks-more-than-doubles-global-farmer-loan-commitment
 Wallstreet.org: “Starbucks Corporation’s (NASDAQ:SBUX) Stock is Looking Good; Global Farmer Loan Program a Big Part of this Success,”https://www.wallstreet.org/2015/06/starbucks-corporations-nasdaqsbux-stock-is-looking-good-global-farmer-loan-program-a-big-part-of-this-success/1413728.html
 Root Capital: “Quarterly Performance Reports,” http://www.rootcapital.org/performance-reports
 Root Capital: “Root Capital’s Performance,” http://www.rootcapital.org/our-impact/dashboard
 Incofin: “Fairtrade Access Fund,” https://www.incofin.com/en/fund/fairtrade-access-fund
 Fairtrade International: “About Fairtrade,” http://www.fairtrade.net/about-fairtrade.html
 Starbucks: “Annual Reports,” http://investor.starbucks.com/phoenix.zhtml?c=99518&p=irol-reportsannual
MicroCapital Universe Profile: “Fairtrade Access Fund,”https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Fairtrade+Access+Fund
MicroCapital Universe Profile: “Fairtrade International,”https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Fairtrade+International
MicroCapital Universe Profile: “Root Capital,” https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Root+Capital
MicroCapital Universe Profile: “Starbucks Coffee Company,”https://www.microcapital.org/microfinanceuniverse/tiki-index.php?page=Starbucks+Coffee+Company
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