An Interview with Grounds for Change

Grant YMarch 31st, 2008
By: Grant Y

It's 10:23 in the morning and I'm furiously banging away at my keyboard. I think my fingers are about to cramp, when Steve casually strolls into the office. Here at Chef Seattle, our office hours are best described as "flexible."

Steve notices my frantic typing, my cell phone on the table, and the earpiece I'm wearing. "Who's that?" he asks.

"Kelsey Marshall," I mouth back, "from Grounds for Change."

"What?!" Steve exclaims, tossing his hands up in the air. I pause for a second, slowly realizing that perhaps I was an hour off when I told Steve the interview was for 11am.

"I told you it was for 10am," I say calmly. I might be lying.

See, Steve is passionate about his coffee, more than I am. So when Grounds for Change, a local coffee roaster, agreed to an interview, Steve jumped at the chance. There are many coffee retailers, roasters, and distributors. But only a handful of them embrace organic, fair trade, and shade grown beans all at once. Grounds for Change is one of those companies.

The idea for the company came about when Marshall and his wife volunteered in Costa Rica alongside organic coffee farmers early in 2002. Although the coffee industry was booming that year, the price of coffee sank to nearly half a dollar per pound.

With farmers struggling to simply survive, Marshall realized the increasing need for a specialty coffee that was both good for farmers and the environment. "Five years ago, the particular niche of organic, fair trade coffee was not on a lot of peoples' radar screens," Marshall explains.

Today, you can walk into just about any cafe and find options for organic or fair trade brews. Even big names like McDonald's, Dunkin Donuts and Wal-Mart have jumped into the fair trade fray. TransFair USA, the only independent certifier of fair trade coffee in the US, reports that growth of fair trade coffee is doubling each year.

Though the fair trade movement is picking up steam, many of the original visionaries that championed free trade are questioning the commitment of big businesses. Marshall is among that group. "I do see it [fair trade] as being increasingly adopted by large roasters, but only as one offering. It's not as a corporate-wide shift. For businesses so large, even if there is product availability, I don't think it will work. All of their business is based on conventional coffee trade."

Marshall is likely right. In 2006, US consumers consumed 2.3 billion pounds of coffee, of which less than 1% was Fair Trade Certified. Though fair trade activists despair at these numbers, the silver lining is that there is still much room for specialty coffee market to grow.

As coffee consumers become more sophisticated, it's no guarantee that small operations like Grounds for Change will have a free ride. Nearly 80% of fair trade coffee is also organic (though the converse is not true), which leaves little room for specialty coffee roasters to one-up their competition.

When asked about the influx of roasters to the specialty coffee market, Marshall is not shy to admit that consumers now have more options than ever. However, Marshall is also quick to point out that buyers should be aware of roasters that offer non-certified organic or fair trade coffee. In the lucrative organic industry, there have long been concerns about mislabeling and outright fraud from producers looking to cash in on the market.

Some ways that Grounds for Change has differentiated itself from the pack is by committing to going green. Through PSE's Green Power Program and carbon offset purchases, the company maintains a carbon neutral profile while supporting sustainable energies. Instead of tossing coffee chaff produced from their roasters, excess material is collected, composted, and then sent to local farmers for use as organic fertilizer.

Grounds for Change also has a charitable side. Charities like the Audubon Society and Save Our Salmon partnered with Grounds for Change to create their own brands of coffee for fundraising purposes. In addition, Grounds for Change is a member of 1% For The Planet, an organization that brings businesses together to donate 1% of their yearly revenue to environmental causes. The company also lists membership in the Fair Trade Federation as well as Co-op America.

Though busy with day-to-day operations of the business, Marshall is personally at the helm when it comes to cupping (taste testing) and coffee selections. I pose a question that comes off more like a statement when I say that he must like coffee.

"I do," he laughs.

My remark seems to prompt a floodgate response, as Marshall begins to describe unique varieties, roast levels, French press, espressos, aromas, and all things coffee until my typing can't keep up.

When I ask about his personal favorites, I learn that the Ethiopian Yirgacheffe ranks highly. Coincidentally, Yirgacheffe is the coffee produced by the Oromia Cooperative, which is the organization featured in the coffee documentary Black Gold.

As far as Marshall's customers are concerned, his top seller is a coffee that is produced by female farmers in Peru, where women run the business and re-invest the proceeds back into their own communities.

"The coffee is also superb," Marshall notes, as if to show that audiences can afford to be both connoisseurs and responsible drinkers.

Based in Poulsbo, I ask Marshall if Seattle's culture and heightened coffee awareness helps sales. "It's certainly nice to get that local level of understanding and acceptance," answers Marshall, "but the vast majority of our customers are in other states. The Seattle market is effectively saturated."

Residents shouldn't be surprised to learn that in a 2005 study by consumer research group NPD, Seattle ranked second in the nation in terms of coffee shop density per capita.

But while Seattlelites will agree that there's little room for coffee in the city, coffee is still growing globally. Earlier this year, demand for coffee, along with a weakening dollar shot the globally traded price for coffee (also known as "C market") to $1.62 per pound. To put that number into perspective, TransFair, the leading organization behind fair trade, sets a current minimum price of $1.31 per pound.

While farmers and co-ops may appreciate the recent price surge, Marshall ends with a warning. "You only make money as a commodity trader when you cash out. So when [the price of] coffee goes up, you sell. Coffee prices then go down. Lately, the market has gone way up, then down. That volatility is the problem. When C market drops back down, farmers end up losing. There's no safety net."

Marshall doesn't believe that the C market is going away anytime soon, however. "It is a method for the larger companies to hedge their risk against coffee futures," he states, referring to the complex system of Wall Street traders, producers, and buyers that dictate global coffee prices.

Businesses reason that as coffee prices rise, traders purchase more coffee futures, which in turn offers an economic incentive for farmers to add more supply to the market. The end result: lowered coffee prices.

The volatility that Marshall mentions is that coffee farmers are forced to live with an unpredictable future. Unexpected rises in price can create additional competition or put pressure to expand, while sudden prices drops can break farms already struggling. With a staggering amount of coffee farmers already living below the poverty level, most aren't asking for premium prices for their coffee--just a consistent and livable wage for their work.

"Fair trade", Marshall ends, "tries to stabilize that price."

--
Grounds for Change is a Poulsbo based coffee roaster and distributor. Chef Seattle would like to thank Kelsey Marshall, owner and co-founder of Grounds for Change, for accepting our interview request. More information about the company, as well as their online store can be found at: http://www.groundsforchange.com.

Oh, and Steve, I might have said 11am after all. Oops.

Snapshot of Grounds for Change website
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