{ "id": "living-income", "url": "https://coffearium.org/entries/living-income/", "license": "CC-BY-4.0", "title": "Living income", "summary": "What a living income is, how a living income benchmark is built and compared with what coffee-producing households actually earn, the coffee benchmarks and reference prices published so far, and what studies find about closing the gap.", "domain": "trade", "kind": "Concept", "stage": "trade", "topics": [ "sustainability" ], "topicSections": { "sustainability": { "id": "levers-studied-for-closing-the-gap", "label": "Levers studied for closing the gap" } }, "lang": "en", "status": "verified", "reviewer": "Coffearium verification pass", "lastVerified": "2026-10-24T00:00:00.000Z", "updated": "2026-10-24T00:00:00.000Z", "added": "2026-10-24T00:00:00.000Z", "brief": [ "A living income is the net annual income a household in a given place needs for a decent standard of living for all its members.1", "The benchmark is the cost of food, housing, other essential needs and a margin for unexpected events, for a reference household (Anker methodology).2", "The living income gap is the benchmark minus the household’s actual total net income, from coffee and every other source.4", "Two Kenyan surveys found that fewer than one in ten coffee households earned a living income; average income was about 35% of the benchmark.17,18", "Fairtrade has published Living Income Reference Prices for coffee from seven countries, 2022–2023; they are guidance, not a minimum price.5,7" ], "quickFacts": [ { "label": "Definition", "value": "Net annual household income needed for a decent standard of living in a particular place (Living Income Community of Practice)" }, { "label": "Benchmark method", "value": "Anker methodology – cost of food, housing, other essential needs, plus a margin for unexpected events" }, { "label": "Living income versus living wage", "value": "Income of a self-employed household from all sources versus pay of a hired worker for a standard work week" }, { "label": "Fairtrade reference prices for coffee", "value": "Colombia, Ethiopia, Honduras, Indonesia (Aceh), Nicaragua, Peru, Uganda (2022–2023)" }, { "label": "Kenya, two surveys (2020/21 and 2021/22)", "value": "Mean income ≈36% (our calculation) and 35% of the benchmark; 9% and 7% (our calculation) of households at or above it" } ], "aka": [ "Living income gap", "Living income benchmark", "Living Income Reference Price" ], "linkTerms": [ "living income", "living incomes", "living income benchmark", "living income gap", "income gap", "Living Income Reference Price", "LIRP", "decent standard of living", "Anker methodology", "living wage" ], "related": [ "who-earns-what", "the-coffee-value-chain", "certifications-and-labels", "sustainability-claims", "coffee-yields", "how-a-coffee-price-is-made", "coffee-price-history", "direct-trade", "cherry-to-green-conversion" ], "contested": [ "Size of the Honduran benchmark: Fairtrade’s provisional benchmark for its reference price is 184,000 lempira (HNL) a year for a four-member household, from a comparison of several earlier estimates updated to July 2022, plus 5% for unexpected events9; an ICO-commissioned study by NewForesight, whose method draws on the Anker methodology, with data from February 2023, gives HNL 18,135 a month (HNL 217,620 a year, our calculation) for two adults and 2.6 children.14 The household models, years and methods differ, so the two values cannot be compared one to one.", "How far price can close the gap: in central Kenya, doubling both farm-gate price and yield, together with 50% more non-coffee income, still left about 67% of households below the benchmark18; a working paper on Kenyan and Vietnamese households argues that large price increases need to be coupled with supply management, and that other income opportunities are essential.17" ], "corrections": [ { "date": "2026-10-24T00:00:00.000Z", "change": "Waarts, Suter and van Asten 2024 set to Tier B; its Vietnamese values removed from the brief, quick facts, chart and reference table; the Kenya-Vietnam chart replaced by a Kenya chart pairing its values with the independent IFPRI 2025 study; the six-times price, 53% and 42% coffee-share figures resting on it alone removed (coffee share now the paper's own 46%, with IFPRI's 45%).", "reason": "Owner ruling of 24 Oct 2026 (working paper, not stated as peer reviewed, two of three authors from a coffee trading company); number rule." }, { "date": "2026-10-24T00:00:00.000Z", "change": "Leiva et al. 2024 cost data: the 31% and 62% cost rises are now attributed to the abstract, with the same-farm results (64% and 66%, Guatemala driven mainly by inputs) added; farm-gate price changes added.", "reason": "The paper's abstract and results differ; the entry had presented the abstract figures as same-farm results." }, { "date": "2026-10-24T00:00:00.000Z", "change": "Ten-country 2021 report: wording corrected to \"ten major producing countries\" and to Brazil being the only country where average net coffee income exceeds some living income estimates; wrong citation of Leiva et al. removed.", "reason": "The report does not call them the ten largest producers, and Leiva et al. does not support the statement." }, { "date": "2026-10-24T00:00:00.000Z", "change": "Reference table: Colombian benchmark date (December 2021 data updated to November 2022), Ethiopian forest coffee price ETB 49.5, Nicaraguan organic price USD 4.86 and Honduran ICO method (NewForesight, drawing on Anker) corrected; central Kenya row added.", "reason": "Values and methods as stated in the Fairtrade and ICO documents." } ], "sources": [ { "id": "s1", "title": "The Concept", "authors": "Living Income Community of Practice", "publisher": "Living Income Community of Practice (living-income.com)", "url": "https://www.living-income.com/the-concept/", "tier": "A/B", "tierNote": "A for the definition of living income that the Community of Practice sets; B otherwise", "quote": "The net annual income required for a household in a particular place to afford a decent standard of living", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s2", "title": "The Anker Methodology", "authors": "Anker Research Institute", "publisher": "Anker Research Institute", "url": "https://www.ankerresearchinstitute.org/anker-methodology", "tier": "A/B", "tierNote": "A for what the Anker methodology defines and how it builds a benchmark; B otherwise", "quote": "A small margin is added to the cost of food, housing and other goods and services, to allow for unforeseen events.", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s3", "title": "Living Income", "authors": "Global Living Wage Coalition", "publisher": "Global Living Wage Coalition", "url": "https://www.globallivingwage.org/about/living-income/", "tier": "A/B", "tierNote": "A for the definitions the coalition uses; B otherwise", "quote": "living income is discussed in the context of any income earner, such as self-employed farmers.", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s4", "title": "Guidance manual on calculating and visualizing income gap to a Living Income Benchmark", "authors": "Tyszler, M.; De Los Rios, C.; Serfilippi, E.; Audet-Bélanger, G.; Laven, A.", "year": 2020, "publisher": "KIT Royal Tropical Institute and Committee on Sustainability Assessment (COSA), for the Living Income Community of Practice (July 2020)", "url": "https://www.kit.nl/wp-content/uploads/2020/08/KIT-Guidance-Measuring-and-visualizing-the-gap.pdf", "tier": "A/B", "tierNote": "A for the definitions and gap formulas it sets for the Living Income Community of Practice; B otherwise", "quote": "We strongly suggest researchers to minimally report, whenever possible, the gap of the median income (as share of the Living Income Benchmark).", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s5", "title": "Living Income Reference Prices", "authors": "Fairtrade International", "publisher": "Fairtrade International", "url": "https://www.fairtrade.net/ca-en/why-fairtrade/why-we-do-it/decent-livelihoods/living-income/living-income-reference-prices.html", "tier": "A/B", "tierNote": "A for the reference prices Fairtrade sets and the parameters it names; B otherwise", "quote": "This is the price a typical farmer household with a viable farm size and a sustainable productivity level", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s6", "title": "Fairtrade Living Income Reference Price for Coffee from Colombia (update, December 2022)", "authors": "Fairtrade International", "year": 2022, "publisher": "Fairtrade International", "url": "https://www.fairtrade.net/content/dam/fairtrade/global/why-we-do-it/living-income/living-income-reference-prices/Fairtrade-Living-Income-Reference-Price-for-Coffee-Colombia.UPDATE-2022.12.pdf", "tier": "A/B", "tierNote": "A for the reference price and the parameters Fairtrade sets; the benchmark is an Anker Research Institute study (A); B otherwise", "quote": "a single Living Income Reference Price of 14,400 pesos", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s7", "title": "Fairtrade Living Income Reference Price for Coffee from Uganda (explanatory note, October 2022)", "authors": "Fairtrade International", "year": 2022, "publisher": "Fairtrade International", "url": "https://www.fairtrade.net/content/dam/fairtrade/global/why-we-do-it/living-income/living-income-reference-prices/Fairtrade-Living-Income-Reference-Price-Uganda-coffee-explanatory-note.pdf", "tier": "A/B", "tierNote": "A for the reference price and the parameters Fairtrade sets; the benchmark is Fairtrade's comparison of earlier estimates (B)", "quote": "the mandatory Fairtrade Premium is not counted towards the Living Income Reference Price", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s8", "title": "Fairtrade Living Income Reference Price for Coffee from Ethiopia (explanatory note)", "authors": "Fairtrade International", "year": 2023, "publisher": "Fairtrade International (listed as 2023)", "url": "https://www.fairtrade.net/content/dam/fairtrade/global/why-we-do-it/living-income/living-income-reference-prices/Fairtrade-Living-Income-Reference-Price-Ethiopia-coffee-explanatory-note.pdf", "tier": "A/B", "tierNote": "A for the reference prices Fairtrade sets; the benchmark is provisional and based on WageIndicator studies (B)", "quote": "a provisional living income benchmark of 245,000 Birr", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s9", "title": "Fairtrade Living Income Reference Price for Coffee from Honduras (explanatory note)", "authors": "Fairtrade International", "year": 2022, "publisher": "Fairtrade International (listed as 2022)", "url": "https://www.fairtrade.net/content/dam/fairtrade/global/why-we-do-it/living-income/living-income-reference-prices/Fairtrade-Living-Income-Reference-Price-Honduras-coffee-explanatory-note.pdf", "tier": "A/B", "tierNote": "A for the reference price and the parameters Fairtrade sets; the benchmark is provisional, from a comparison of earlier estimates (B)", "quote": "is established at 94 Lempira (US$ 3.89) per kilo of dried parchment at farmgate", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s10", "title": "Fairtrade Living Income Reference Price for Coffee from Aceh, Indonesia (explanatory note)", "authors": "Fairtrade International", "year": 2022, "publisher": "Fairtrade International (listed as 2022; price set in November 2021)", "url": "https://www.fairtrade.net/content/dam/fairtrade/global/why-we-do-it/living-income/living-income-reference-prices/Fairtrade-Living-Income-Reference-Price-for-Coffee-from-Aceh-Indonesia-explanatory-note.pdf", "tier": "A/B", "tierNote": "A for the reference price and the parameters Fairtrade sets; the benchmark is preliminary, based on WageIndicator and RSPO studies (B)", "quote": "Rp 42,100 (US$ 2.94) per kilogramme at farmgate", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s11", "title": "Fairtrade Living Income Reference Price for Organic Arabica Coffee from Peru (explanatory note)", "authors": "Fairtrade International", "year": 2023, "publisher": "Fairtrade International (listed as 2023)", "url": "https://www.fairtrade.net/content/dam/fairtrade/global/why-we-do-it/living-income/living-income-reference-prices/Fairtrade-Living-Income-Reference-Price-Peru-coffee-explanatory-note-2024.pdf", "tier": "A/B", "tierNote": "A for the reference price and the parameters Fairtrade sets; the benchmark is an Anker Research Institute study (A); B otherwise", "quote": "The Anker Research Institute conducted a living income benchmark study", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s12", "title": "Fairtrade Living Income Reference Price for Coffee from Nicaragua (explanatory note)", "authors": "Fairtrade International", "year": 2023, "publisher": "Fairtrade International (listed as 2023)", "url": "https://www.fairtrade.net/content/dam/fairtrade/global/why-we-do-it/living-income/living-income-reference-prices/Fairtrade-Living-Income-Reference-Price-Nicaragua-coffee-explanatory-note-2024.pdf", "tier": "A/B", "tierNote": "A for the reference prices and the parameters Fairtrade sets; the benchmark is an Anker Research Institute study of 2017, updated (A); B otherwise", "quote": "use an average benchmark of 250,000 Cordobas (US$ 6,897)", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s13", "title": "Fairtrade Coffee Price Announcement (30 July 2026)", "authors": "Fairtrade International, Standards and Pricing", "year": 2026, "publisher": "Fairtrade International, Bonn", "url": "https://www.fairtrade.net/content/dam/fairtrade/fairtrade-international/standards/standards-and-pricing-work-in-progress/2026-07-30_Coffee%20Price%20Announcement_EN.pdf", "tier": "A/B", "tierNote": "A for the minimum prices, Premium and organic differential that the standard sets; B otherwise", "quote": "The Fairtrade Premium is paid in addition to the Fairtrade Minimum Price or market price, whichever is higher.", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s14", "title": "Measurement of the Living Income Benchmark in three coffee-growing regions of Honduras: Comayagua, Copán, and El Paraíso (emphasis on coffee households)", "authors": "Lopez, A.; Ayon, A.; Backer, J.; Viviers-Rasmussen, D. (NewForesight), with IHCAFE and PROMECAFE", "year": 2023, "publisher": "International Coffee Organization (ICO), Coffee Public-Private Task Force (September 2023)", "url": "https://ico.org/documents/GKH/Honduras_EN.pdf", "tier": "A/B", "tierNote": "A for the benchmark values of this study commissioned and published by the ICO; B otherwise", "quote": "The average Living Income is HNL 18,135 per month.", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s15", "title": "ICO partners with the Anker Research Institute on living income benchmarks (press release, 22 June 2023)", "authors": "International Coffee Organization", "year": 2023, "publisher": "International Coffee Organization, London", "url": "https://ico.org/documents/cy2022-23/pr-344e-joint-pr-anker-institute.pdf", "tier": "A/B", "tierNote": "A for the ICO's own decisions and plans; B otherwise", "quote": "the ICO is partnering with the Anker Research Institute to undertake Anker Living Income Benchmarks", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s16", "title": "Determine the Living Income Benchmark (ICO Global Knowledge Hub guide)", "authors": "International Coffee Organization", "publisher": "International Coffee Organization", "url": "https://ico.org/global-knowledge-hub/guide/determine-the-living-income-benchmark/", "tier": "B", "quote": "Explore if existing Living Income benchmarks can be used for your region.", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s17", "title": "Return on household labour: a means to accelerate the path to a living income for smallholder coffee farming households", "authors": "Waarts, Y.; Suter, Y.-P.; van Asten, P.", "year": 2024, "publisher": "Wageningen University & Research (working paper, October 2024)", "url": "https://edepot.wur.nl/675187", "tier": "B", "tierNote": "Working paper (Wageningen University & Research, with a white-paper header), not stated to be peer reviewed; two of the three authors (Suter, van Asten) work for ofi, a coffee trading company. Tier B (owner ruling, 24 Oct 2026). Its Kenyan values are used only where the independent IFPRI study (source 18) supports them; its Vietnamese values carry no number in this entry.", "quote": "Nine per cent of Kenyan households earn a living income", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s18", "title": "Brewing prosperity: An analysis of living income gaps among coffee smallholders in central Kenya (IFPRI Discussion Paper 2342)", "authors": "Boukaka, S. A.; Benfica, R.", "year": 2025, "publisher": "International Food Policy Research Institute (IFPRI), Washington, DC", "url": "https://cgspace.cgiar.org/items/aca856d6-f271-4e8d-af18-5dc40db92507", "tier": "B", "tierNote": "Research institute discussion paper (CGIAR), June 2025; the paper states it has not been subject to formal external review. 181 coffee farmers in Nyeri and Murang’a, 2021/22 season; independent of source 17.", "quote": "just 35 percent of the 312 KSh living income benchmark", "quotes": [], "abstractOnly": true, "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s19", "title": "Responsible Coffee Sourcing: Towards a Living Income for Producers", "authors": "Cordes, K. Y.; Sagan, M.; Kennedy, S.", "year": 2021, "publisher": "Columbia Center on Sustainable Investment (CCSI), Columbia University, New York (July 2021)", "url": "https://ccsi.columbia.edu/sites/default/files/content/0721%20CCSI%20Responsible%20Coffee%20Sourcing%20Report.pdf", "tier": "B", "tierNote": "University research centre report, not peer reviewed; country figures are modelled from 2018–2019 prices and assumptions. Carries none of its income figures in this entry, only a description of its own scope.", "quote": "our country averages do not account for household income from sources other than coffee.", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s20", "title": "Changes in the economics of coffee production between 2008 and 2019: a tale of two Central American countries", "authors": "Leiva, B.; Vargas, A.; Casanoves, F.; Haggar, J.", "year": 2024, "publisher": "Frontiers in Sustainable Food Systems 8, 1376051", "url": "https://www.frontiersin.org/journals/sustainable-food-systems/articles/10.3389/fsufs.2024.1376051/full", "doi": "10.3389/fsufs.2024.1376051", "tier": "A", "quote": "declined to a third of its 2008 level in Guatemala.", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s21", "title": "Multiple pathways towards achieving a living income for different types of smallholder tree-crop commodity farmers", "authors": "Waarts, Y. R.; Janssen, V.; Aryeetey, R.; Onduru, D.; Heriyanto, D.; Tin Aprillya, S.; N'Guessan, A.; Courbois, L.; Bakker, D.; Ingram, V. J.", "year": 2021, "publisher": "Food Security 13(6), 1467–1496", "url": "https://link.springer.com/article/10.1007/s12571-021-01220-5", "doi": "10.1007/s12571-021-01220-5", "tier": "A", "quote": "there are no silver bullets to move them out of poverty", "quotes": [], "accessed": "2026-10-24T00:00:00.000Z" }, { "id": "s22", "title": "How Effective is Multiple Certification in Improving the Economic Conditions of Smallholder Farmers? Evidence from an Impact Evaluation in Colombia's Coffee Belt", "authors": "Dietz, T.; Estrella Chong, A.; Grabs, J.; Kilian, B.", "year": 2020, "publisher": "Journal of Development Studies 56(6), 1141–1160", "url": "https://ideas.repec.org/a/taf/jdevst/v56y2020i6p1141-1160.html", "doi": "10.1080/00220388.2019.1632433", "tier": "A", "quote": "the majority of farmers are unable to break even, irrespective of their certification status", "quotes": [], "abstractOnly": true, "accessed": "2026-10-24T00:00:00.000Z" } ], "markdown": "## What a living income is\n\nA **living income** is the net annual income a household in a particular place needs for a decent standard of living for all its members.1 This is the definition of the Living Income Community of Practice, a network that works on the concept.1 A decent standard of living includes food, water, housing, education, healthcare, transport and clothing.1 It also includes other essential needs, with a provision for unexpected events.1\n\nThe concept looks at the household, not at one crop. Its income can come from several sources: coffee, other crops, livestock, wages or money sent home by relatives.1,4 “Net” means after the costs of farming are paid.4\n\nA living income is not the same as the poverty line. The ICO-commissioned benchmark for Honduras lies above both the national and the international poverty lines.14\n\n## How a benchmark is built\n\nA **living income benchmark** puts a money value on a decent standard of living in one place and year. Fairtrade sets the cost of a decent living with the Anker methodology, and the ICO has commissioned Anker benchmarks for coffee.5,15 The method was designed for living wages and is also applied to living income.3 It adds up four costs:2\n\n1. **Food:** a nutritious, low-cost model diet that fits local food preferences, priced at local markets.2\n2. **Housing:** the cost of healthy housing that meets local and international standards of decency.2\n3. **Other essential needs:** healthcare, education, transport, clothing and communication, from household expenditure surveys.2\n4. **Unexpected events:** a small margin added to the other three.2\n\nThe total applies to a **reference household**, whose size the method sets from local data.2 Household size changes the result a great deal. Fairtrade’s benchmark for Colombia assumes four people; its benchmarks for Uganda and Ethiopia assume seven.6,7,8\n\nNot every published coffee benchmark is an Anker study. For Uganda, Ethiopia, Honduras and Aceh, Fairtrade combined earlier estimates from other methods and labelled some results provisional.7,8,9,10 In June 2023 the International Coffee Organization (ICO) announced that it was working with the Anker Research Institute on benchmarks for Ethiopia, Indonesia, Mexico and Vietnam.15\n\n## Measuring the gap\n\nThe **living income gap** is the difference between the benchmark and a household’s actual total net income.4 Actual income includes net farm income, off-farm income and other income such as remittances.4 The value of food the household grows and eats itself can be counted too.4\n\n
\n
\n
    \n
  1. Food. A low-cost, nutritious model diet at local prices.2
    2. \n
  2. Housing. Decent, healthy housing.2
    3. \n
  3. Other essential needs. Healthcare, education, transport, clothing and more.2
    4. \n
  4. Unexpected events. A small margin on top; columns 1–4 together are the benchmark.1,2
    5. \n
  5. Net coffee income. Coffee sales minus the costs of producing coffee.4
    6. \n
  6. Other net farm income. Other crops and livestock, minus their costs.4
    7. \n
  7. Off-farm income. Wages, business income, remittances.4
    8. \n
  8. Food grown and eaten at home. Its value may be counted; 5–8 together are actual net income.4
    9. \n
  9. Living income gap. The benchmark minus actual total net household income.4
    10. \n
\n
The living income gap: the cost of a decent standard of living (left) against the household’s actual net income from all sources (right). Heights are arbitrary. Point at a number or a line of the legend to highlight the part. Schematic, not to scale.1,2,4
\n
\n\nA gap can be given for the average household or for the middle one. The guidance for the Community of Practice asks researchers at least to report the gap of the **median** income, as a share of the benchmark.4 The median is less affected by a few very rich or very poor households.4\n\nMany studies estimate income from coffee alone. A 2021 report that compared ten producing countries did so, and states that it leaves out other household income.19 Such figures show how far coffee covers the benchmark, not the full household gap.\n\n## What coffee studies have found\n\nMeasured coffee data are scarce. The studies consulted for this entry cover a few countries, years and samples; none of them speaks for “coffee” as a whole.\n\n- **Kenya.** A 2024 working paper surveyed 340 arabica households in Kenya (July 2020 to June 2021); 9% earned a living income.17 A separate 2025 study of 181 coffee farmers in cooperatives in Nyeri and Murang’a (2021/22 season) found average earnings of 35% of the benchmark, with about 93% of farmers below it.18\n- **Vietnam.** The 2024 working paper also surveyed robusta households in Dak Lak and reports a much larger share with a living income than in Kenya.17 No independent study consulted for this entry checks its Vietnamese values, so they are not given here.\n- **Ten producing countries.** A 2021 model at 2018–2019 prices found that, of ten major producing countries, only in Brazil did the average producer’s net coffee income exceed some living income estimates.19\n- **Colombia.** A study of over 600 farmers in two Fairtrade cooperatives found that most did not break even on coffee, whatever their certification.22\n\n
\n
\n
Two independent surveys of Kenyan coffee households: a 2024 working paper (340 arabica households, July 2020 to June 2021, household-specific benchmarks from a rural living wage benchmark) and a 2025 IFPRI study (181 cooperative farmers in Nyeri and Murang’a, 2021/22, benchmark KSh 312 per person per day). Samples, years and benchmarks differ; the values are close but not the same measurement.17,18
\n
\n\nIn the 2024 working paper the mean Kenyan household earned USD 1,235 a year against a mean benchmark of USD 3,395, about 36% of it (our calculation from the study’s means).17 This is close to the 35% the independent 2025 study found in central Kenya.18 Means hide the spread: in both studies more than nine in ten households were below the benchmark.17,18\n\n## Living Income Reference Prices\n\nFairtrade publishes **Living Income Reference Prices** for coffee. Such a price is what a typical household would need for a living income from its crop. It assumes a viable farm size and a sustainable yield.5 It combines four parameters: the cost of a decent living, a target yield, the cost of sustainable production and a viable farm size.5\n\nAs of October 2026, Fairtrade lists coffee reference prices for Colombia, Ethiopia, Honduras, Indonesia, Nicaragua, Peru and Uganda, from 2022 and 2023.5 Each is set at the farm gate in local currency, per kilogram of cherry or parchment coffee.6,9,10 Several notes add an indicative FOB (free on board) price per pound of green coffee.7,8,10,11,12\n\n
\n
\n
Fairtrade Living Income Reference Prices for coffee as indicative FOB equivalents, USD per lb of green coffee, by country and year listed. The Fairtrade Minimum Price for washed arabica from 1 December 2026 is shown for comparison. Most reference prices shown are for organic coffee. Colombia and Honduras give farm-gate prices only and are not shown.5,7,8,10,11,12,13
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\n\nA reference price is not a minimum price. Fairtrade calls it “just one tool” and does not count the Fairtrade Premium towards it.7 The binding Fairtrade Minimum Price for conventional washed arabica is USD 2.00 per lb FOB from 1 December 2026; the organic differential adds USD 0.40, giving USD 2.40 for organic (our calculation).13 How the minimum price and Premium work is explained in Certifications and labels. How the export price is shared out along the chain is covered in Who earns what along the chain.\n\n\n\n## Reference values\n\nBenchmarks and reference prices as Fairtrade and the ICO publish them. Values are in the source currency, with the source’s own US dollar conversion. “Dried parchment” is parchment coffee dried for sale; green bean equivalent (GBE) is the corresponding mass of green coffee.\n\n| Parameter | Value | Household model and method | Source |\n|---|---|---|---|\n| Colombia, benchmark | COP 33,506,800 per year (average of Antioquia and Huila; data of December 2021 updated to November 2022) | 4 people: 2 adults, 2 children; Global Living Wage Coalition study with the Anker Research Institute | Fairtrade6 |\n| Colombia, reference price | COP 14,400 (USD 3.03) per kg dried parchment, from December 2022 | Viable farm 2.8 ha; target yield 1,800 kg/ha (conventional) | Fairtrade6 |\n| Uganda, benchmark | UGX 18.9 million (USD 4,974) per year, updated to March 2022 | 7 people; comparison of earlier estimates | Fairtrade7 |\n| Uganda, reference price (organic arabica) | UGX 11,640 (USD 3.06) per kg dried parchment; ≈USD 2.22 per lb GBE FOB | Viable farm 2 acres (≈0.8 ha, our calculation); target 640 kg dried parchment per acre | Fairtrade7 |\n| Ethiopia, benchmark | ETB 245,000 per year, provisional, updated to March 2023 | 7 people; WageIndicator studies, Global Living Wage Coalition proxy as comparison | Fairtrade8 |\n| Ethiopia, reference prices (organic) | Garden coffee ETB 74 (USD 1.35), forest coffee ETB 49.5 (USD 0.90) per kg cherry; ≈USD 4.18 and 2.96 per lb green FOB | Viable farm 1.4 ha (garden), 2.5 ha (forest) | Fairtrade8 |\n| Honduras, benchmark (Fairtrade) | HNL 184,000 (USD 7,619) per year, provisional, updated to July 2022 | 4 people; comparison of earlier estimates plus 5% for unexpected events | Fairtrade9 |\n| Honduras, benchmark (ICO) | HNL 18,135 per month (≈USD 745), February 2023, rural Comayagua, Copán and El Paraíso | 2 adults, 2.6 children, 1.5 full-time workers; NewForesight method drawing on the Anker methodology | ICO14 |\n| Honduras, reference price (organic arabica) | HNL 94 (USD 3.89) per kg dried parchment | Viable farm 3 ha; 1,500 kg dried parchment per ha | Fairtrade9 |\n| Indonesia (Aceh), benchmark | IDR 75 million per year, preliminary | 4 people; WageIndicator (2018) and RSPO (2017) studies updated to 2021 | Fairtrade10 |\n| Indonesia (Aceh), reference price (organic Gayo arabica) | IDR 42,100 (USD 2.94) per kg wet parchment; IDR 13,600 (USD 0.95) per kg cherry; ≈USD 2.82 per lb green FOB | Viable farm 1 ha; 1,000 kg GBE per ha | Fairtrade10 |\n| Peru, benchmark | PEN 30,360 (USD 8,205) per year, updated to June 2023 | 4 people: 2 adults, 2 children; Anker Research Institute study (2022) | Fairtrade11 |\n| Peru, reference price (organic arabica) | PEN 14 (USD 3.78) per kg dried parchment; ≈USD 2.49 per lb green FOB | Full-employment coffee area 3.5 ha; 1,380 kg dried parchment per ha | Fairtrade11 |\n| Nicaragua, benchmark | NIO 250,000 (USD 6,897) per year, updated to June 2023 | Baseline household 4.2 people, 2.8 working-age adults; Anker Research Institute study (2017) | Fairtrade12 |\n| Nicaragua, reference prices | Conventional NIO 131 (USD 3.61), organic NIO 176 (USD 4.86) per kg dried parchment; ≈USD 2.50 and 3.21 per lb green FOB | Full-employment coffee area 2.1 ha; 1,800 (conventional) and 1,180 (organic) kg dried parchment per ha | Fairtrade12 |\n| Kenya, measured benchmark and income | Mean benchmark USD 3,395; mean net household income USD 1,235 per year (2020/21), ≈36% of the benchmark (our calculation) | 340 arabica households, mean 3.42 people; ALIGN living wage benchmark for rural Kericho, inflation-adjusted | Waarts et al.17 |\n| Central Kenya, measured benchmark and income | Benchmark KSh 312 per person per day; average earnings KSh 109 per person per day, 35% of the benchmark (2021/22) | 181 cooperative coffee farmers in Nyeri and Murang’a; Anker-based living wage update for Kenya | Boukaka and Benfica18 |\n\nCurrency codes: COP Colombian peso, UGX Ugandan shilling, ETB Ethiopian birr, HNL Honduran lempira, IDR Indonesian rupiah, PEN Peruvian sol, NIO Nicaraguan córdoba. The US dollar figures are those given in each source, at its own exchange rate. 1 acre = 0.4047 ha.\n\n## Benchmarks: methods and limits\n\n**Household model.** A benchmark is the cost of living of one reference household divided among the earners the method assumes.2 The Anker methodology divides the total cost by the number of workers in a typical family, a number between 1 and 2.2 The ICO’s Honduras study assumes 1.5 full-time workers for a household of two adults and 2.6 children.14 A seven-person benchmark, as in Fairtrade’s notes for Uganda and Ethiopia, cannot be compared directly with a four-person one.6,7,8\n\n**Method and age.** Fairtrade’s Colombian, Peruvian and Nicaraguan benchmarks come from Anker Research Institute studies.6,11,12 Its Ugandan, Ethiopian, Honduran and Indonesian benchmarks combine earlier estimates and are marked provisional or preliminary in three cases.7,8,9,10 Older benchmarks are brought forward with inflation rates.7,11,12 The ICO’s guidance first asks whether an existing benchmark can be used for a region before a new study is made.16\n\n**Measuring actual income.** The gap of the mean is the mean benchmark minus the mean total household income; the same is done with medians.4 The guidance also defines an index that averages each household’s shortfall below the benchmark, counting zero for households above it.4 Income is net of agricultural production costs, including inputs and paid labour.4 The guidance consulted for this entry does not say whether the household’s own labour is given a value.4\n\n**Coffee-only estimates.** The 2021 ten-country report modelled coffee income from prices and assumptions of 2018–2019 and left out other income.19 Its figures are therefore not measured household gaps, and this entry does not chart them.\n\n## Levers studied for closing the gap\n\nStudies discuss four levers: price, yield, costs and other sources of income. The evidence below comes only from the studies consulted for this entry; we do not rank the levers.\n\n**Price.** In central Kenya, doubling both farm-gate price and yield, together with 50% more non-coffee income, cut the share of households below the benchmark from about 93% to about 67%.18 The IFPRI authors find it “virtually impossible” for many smallholders to reach a living income from coffee alone.18 The authors of the 2024 working paper estimate, for their Kenyan sample, a theoretical farm-gate price several times the 2020 price, at which many households would still fall short.17 They argue that large price increases paid at scale need to be coupled with supply management.17\n\n**Costs.** A peer-reviewed study compared costs and earnings of coffee farms in Costa Rica and Guatemala in 2008/09 and 2019/20, in US dollars with 2008 values adjusted for inflation.20 The 2019/20 survey returned to farms of the first survey, replacing some with similar nearby farms.20 Its abstract reports that agronomic costs per hectare rose by 31% in Costa Rica and 62% in Guatemala, mainly through labour costs.20 For the farms surveyed in both periods, its results give rises of 64% and 66% and attribute Guatemala’s rise mostly to inputs.20 Net income per hectare (EBITDA) rose by about 30% in Costa Rica, where farm-gate prices rose by 13.6%, and fell to about a third of its 2008 level in Guatemala, where they fell by 13.8%.20\n\n**Yield and farm size.** Each reference price assumes a target yield and a viable farm size; actual farms can be smaller.5,7 A 2021 study of cocoa and tea households, not coffee, found that farms would have to be four to almost eight times larger to reach a living income, other things equal.21 The same study found that the poorest farmers gain least from price rises, because they produce the least.21 How yields are measured in coffee is explained in Coffee yields.\n\n**Other income.** Coffee made up on average 46% of household income in the Kenyan sample of the 2024 working paper and 45% in the 2025 central Kenya study.17,18 The authors of the working paper call other income opportunities that pay as well as coffee “essential”.17 The 2021 cocoa and tea study concludes that there are “no silver bullets”.21\n\n## Living wage for hired workers\n\nA **living wage** is pay for a standard work week that lets a worker in a particular place afford a decent standard of living for the worker and the family.2 It applies to hired workers, on farms or elsewhere; living income applies to any earner, such as self-employed farmers.3 Both start from the same cost of a decent living, because that cost does not depend on how the income is earned.3 A living wage is stated per worker, gross, before deductions; a living income is stated per household, net, from all sources.1,2,14 In the ICO’s Honduras study, the gross living wage is HNL 12,775 per month per full-time worker, above the agricultural minimum wages the study lists.14 A coffee household can need a living income itself and also hire seasonal workers who need a living wage. Fairtrade’s Colombian reference price, for example, counts the pay of harvest workers as a production cost.6\n\n## Open questions\n\n- What share of coffee-producing households earns a living income in most producing countries. No peer-reviewed study consulted for this entry measured it for a whole country.\n- How the provisional benchmarks for Ethiopia and Honduras compare with the Anker benchmarks the ICO planned with the Anker Research Institute.8,9,15\n- How many buyers pay Living Income Reference Prices, and for what volume. No source consulted for this entry reports it.\n- Whether, and how, the household’s own labour should be valued in the gap; the guidance consulted for this entry does not settle it.4\n\n## Key studies\n\n
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Waarts, Suter and van Asten, 2024 – Living income in Kenya and Vietnam. Compared arabica households in Kenya and robusta households in Dak Lak, Vietnam, with household-specific benchmarks. Fewer than one in ten Kenyan households earned a living income; the paper also expresses the benchmark per working day. A working paper, not stated to be peer reviewed, with two of three authors from a coffee trading company; its Kenyan results agree with the IFPRI study below.

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Wageningen University & Research, working paper, October 2024 · edepot.wur.nl/675187

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Boukaka and Benfica, 2025 – Living income gaps in central Kenya. Surveyed coffee farmers organised in cooperatives in Nyeri and Murang’a. Average earnings were about a third of the benchmark; doubling prices and yields narrowed the gap, but most households stayed below it. Not externally reviewed.

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IFPRI Discussion Paper 2342 · hdl:10568/175180

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Leiva et al., 2024 – Coffee economics in Costa Rica and Guatemala, 2008–2019. Revisited farms surveyed in 2008/09 and compared their costs and earnings in 2019/20. Rising costs were absorbed in Costa Rica, where farm-gate prices rose, but net income fell sharply in Guatemala, where they fell.

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Frontiers in Sustainable Food Systems 8, 1376051 · doi:10.3389/fsufs.2024.1376051

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Waarts et al., 2021 – Pathways to a living income for tree-crop farmers. Analysed cocoa households in Ghana and Côte d’Ivoire and tea households in Kenya. Most were below a living income; no single lever closed the gap, and farms would need to be four to almost eight times larger on their own. Not a coffee study, but often cited for the method.

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Food Security 13(6), 1467–1496 · doi:10.1007/s12571-021-01220-5

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Dietz et al., 2020 – Multiple certification in Colombia. Surveyed over 600 coffee farmers in two Fairtrade cooperatives. Additional certificates brought limited economic gains, and most farmers did not break even, whatever their certification.

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Journal of Development Studies 56(6), 1141–1160 · doi:10.1080/00220388.2019.1632433

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