Ethical coffee on the menu after Starbucks signs fair-trade deal

Starbucks, the scourge of anti-globalisation protesters, yesterday agreed to sell "politically correct" coffee at its shops in Britain.

The American-owned chain, which has 4,000 outlets worldwide, has struck a symbolic deal in which Third World farmers will receive a higher price for their crops.

An agreement has been reached with the Fairtrade Foundation, which represents Third World producers and monitors farmers' environmental and ethical standards.

Ian Bretnam, Fairtrade's deputy director, said: "The main significance is the profile; the awareness it gives to fair trade. From what we understand, the volume is not likely to be too significant."

After introducing "ethical" coffee to its shops in North America two years ago, Starbucks will now extend the range to the UK this summer. The Costa Coffee chain already offers fair-trade coffee here.

The move follows dire warnings about the plunging prices in some coffee-producing countries at the World Coffee Conference in London.

Due to overproduction, the price of coffee beans dropped around 70 per cent last year, causing hardship for farmers in South America, south and east Asia and parts of Africa.

A report by Oxfam said that the price of raw coffee exported from producer countries accounts for less than 7 per cent of the cost of coffee to Western consumers – the rest goes to processors and retailers in rich countries. It named Starbucks and Nestlé as among the chief culprits.

Starbucks, which reported record profits of $805m (£570m) in the three months to the end of December, buys about 1 per cent of the global coffee crop.

A company spokeswoman said: "We are delighted to have been able to sign this agreement, it's not just advertising."

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