Note: Analysts believe that Starbucks is bowing to pressure from their corporate partners Kraft, Pepsi by refusing to pledge that they will never use GM coffee.  This statement would indicate that they are planning on using GM-decaffeinated beans which are currently being developed by the biotech industry.

July 24, 2001

Thank you for your call to discuss Starbucks interests and activities related to genetically modified coffee beans and Fair Trade coffee.

As we discussed, Starbucks coffee contains no GMOs and is not derived from genetically modified sources.  We do not support the development of GM ripening-controlled coffee which would be harvested mechanically and have no intention of purchasing such coffee in the future.  Further, we believe that the introduction of this technology would be very damaging to millions of small farmers and farm workers whose main source of income depends on handpicked coffee.  So long as this condition exists, Starbucks will not support this technology.

Regarding Fair Trade coffee, as we discussed Starbucks sells whole bean Fair Trade coffee in the U.S. in over 2500 company-owned stores and on the internet, and Fair Trade coffee - for brewing - to college and university accounts, hotels and restaurants.  Unfortunately, we have not found an adequate supply of high quality Fair Trade coffee to brew system-wide on a regular basis, but any customer can request brewed Fair Trade coffee in any company-owned store in the U.S.  We are actively engaged in conversations with the international FairTrade Labeling Organization regarding sourcing more high quality coffee to meet our needs, as well as the possibility of their licensing Starbucks to sell Fair Trade coffee in the communities where we do business around the world.

We appreciate the work you are doing on behalf of coffee farmers and will be happy to keep you apprised of the progress that we are making in these areas.

Sincerely,

Sue Mecklenburg

vice president, business practices

Starbucks Coffee Company