Classification

A number of classifications are used to label coffee produced under certain environmental or labor standards. For instance, Bird-Friendly [2]> or shade-grown coffee is said to be produced in regions where natural shade (canopy trees) is used to shelter coffee plants during parts of the growing season. Organic coffee is produced under strict certification guidelines, and is grown without the use of potentially harmful artificial pesticides or fertilizers; conventional coffee is grown with more pesticides than any other agricultural cropЧcotton comes second.[citation needed]. Fair trade coffee is produced by small coffee producers who belong to cooperatives; guaranteeing for these cooperatives a minimum price, though with historically low prices, current fair-trade minimums are lower than the market price of only a few years ago. TransFair USA is the primary organization currently overseeing Fair Trade coffee practices in the United States, while the Fairtrade Foundation does so in the United Kingdom. The coffee industry currently has a commodity chain that involves producers, middlemen exporters, importers, roasters, and retailers before reaching the consumer.[11] Middlemen exporters, often referred to as coffee "coyotes," purchase coffee directly from small farmers.[11] Large coffee estates and plantations often export their own harvests or have direct arrangements with a transnational coffee processing or distributing company. Under either arrangement, large produce

s can sell at prices set by the New York Coffee Exchange. Green coffee is then purchased by importers from exporters or large plantation owners.[11] Importers hold inventory of large container loads, which they sell gradually through numerous small orders. They have capital resources to obtain quality coffee from around the world, capital normal roasters do not have. Roasters' heavy reliance on importers gives the importers great influence over the types of coffee that are sold to consumers. In the United States, there are around 1,200 roasters. Roasters have the highest profit margin in the commodity chain.[11] Large roasters normally sell pre-packaged coffee to large retailers, such as Maxwell House, Folgers and Millstone. Coffee reaches the consumers through cafes and specialty stores selling coffee, of which, approximately, 30% are chains, and through supermarkets and traditional retail chains. Supermarkets and traditional retail chains hold about 60% of market share and are the primary channel for both specialty coffee and non-specialty coffee. Twelve billion pounds of coffee is consumed around the globe annually, and the United States alone has over 130 million coffee drinkers. Coffee is also bought and sold by investors and price speculators as a tradable commodity. Coffee futures contracts are traded on the New York Mercantile Exchange (NYMEX) under ticker symbol KC with contract deliveries occurring every year in March, May, July, September, and December.