The Co-op has become the first UK supermarket to switch all its own-label coffee to fair trade.
The group said the move would boost the UK fair trade coffee market by 15%, or about £4m, a year.
World coffee prices are now at a 30-year low with many farmers selling coffee for less than it costs them to produce it.
Sales of fair trade coffee increased by almost a third last year, according to the Fairtrade Foundation.
Under fair trade, coffee growers get a better price, currently double or triple the global market price.
Adrian Lovett, Oxfam's Director of Campaigns, welcomed the move.
"The Co-op is setting a global standard for the coffee companies to follow," he said.
"Buying fair trade is the simplest way for shoppers to help coffee farmers and the Co-op is providing what consumers want - coffee with a conscience."
Malcolm Hepworth, chief operating officer at Co-operative Retail, said: "The coffee crisis is complex, and fair trade is only part of the solution.
"But it's the simplest way we can make a real and immediate difference. Immediate, because all consumers have to do is buy fair trade. Real, because growers will get much more for their coffee."
The Co-op is sourcing its fair trade coffee, which will be used to make its instant and ground coffee brands, from five farmer co-operatives - four in Central and South America and one in Tanzania, East Africa.
It believes the switch should increase its existing sales of fair trade coffee from £2.1m to £6.5m, it said.
Co-op will continue to stock both conventional and other fair trade labels.
But it said it would offer its new fair trade instant and ground coffee products at competitive prices to encourage people to use them.