This thesis examines the main problems faced by producers of primary agricultural commodities for export. In particular, it focuses on the coffee market and describes the current crisis experienced by coffee producers in Nicaragua. It details the history and organization of fair trade, a relatively new movement designed to alleviate poverty for producers in developing countries. Based on a 12-week fieldtrip to Matagalpa in 2001, this project describes the organization of fair trade coffee production and commercialization, and assesses its impact on both the producers and institutions involved on the ground. While the direct and indirect economic benefits of fair trade coffee sales are evident in the survival and investment of producer organizations in Matagalpa in times of extreme price depression, this research reveals that awareness of fair trade remains low at the producer level. This is due to the fact that the fair trade market has partly acquired the supportive role once provided to cooperatives by the Sandinista government, without actually altering them in ways perceivable by producers.