Direct Trade is an effort by US coffee importer and retailer Intelligensia to do more and better for coffee producers. How?
Intelligensia works directly with coffee growers to help improve the quality of their coffee. They pay growers or cooperatives (not exporters) a 25% premium over fair trade prices. They closely monitor what growers are doing and the impact of these efforts, which requires a hefty commitment in terms of time/travel/education/etc.. And they expect growers or cooperatives to commit to "sustainable" social and environmental practices.
What's the big difference between Fair Trade and Direct Trade? For one, Intelligensia doesn't seem averse to working directly with family-owned farms (which Fair Trade doesn't do). But, the main difference may come down this: direct trade cuts out the fair-trade middleman . . . Intelligensia doesn't pay to put the fair trade logo on their coffee, instead they put their own logo on the product and that logo indicates the existence of a continuing relationship with growers.
Building a strong relationship with growers is a costly investment that may be sensible for specialty-coffee retailers operating at the high end of the market and serving discriminating consumers (who want to support this kind of support). This strategy may not work for importers buying lower-grade, cheaper commodity grade coffee. I was wondering about for craft products like those that Indego's partners produce . . . IA has the kind of continuing, deep relationships that Intelligensia has with its producers -- should IA be a Direct Trade retailer?
(Photo: coffee cherries ripening on the shores of Lake Kivu, Rwanda. One of my pictures.)