Fairtrade

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Fairtrade

• From the Suppliers View

By Chris Partridge and Emma Macberry
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What is Fairtrade?
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• A social movement which promotes standards for
  international labour and social policy in areas
  related to production of Fairtrade products.
• There are currently nine products recognised by
  the Fairtrade Labelling Organisations
  International (FLO). They are coffee, tea, sugar,
  fruit juices, honey, cocoa, preserves, fresh
  fruits and rice.
• In 2006, worldwide sales of Fairtrade products
  exceeded 1billion.

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Principles of Fairtrade

• Creating opportunities for economically
  disadvantaged producers
• Capacity building
• Payment of a fair price
• Gender equality
• Working conditions
• Environmental protection

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Against Fairtrade
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Certification Fee

• The FLO charges an certification as well as an
  annual fee.
• Takes away the farmers hard earned money
• Doesnt allow small suppliers who cant form
  cooperatives which are democratically controlled
  to be certified.

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Companies Exploit the Suppliers

• In 2005 Starbucks imported 11.5 million of
  Fairtrade coffee, this is only a reported 3.7 of
  there total import.
• Leads to an insufficient demand, so suppliers
  sell an average of 20 to Fairtrade, the rest
  goes to the world market at lower prices.

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Mandate of Pricing

• Doesnt take into account the various living
  differences in the world
• -In Brazil, 1.26 per pound for coffee is a
  fortune. In the forest in the mountains of
  Mexico, the money barely is enough to justify
  doing it. Kevin Knox.
• Prices may be too low for specific farmers, and
  not enough to meet there domestic needs.

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For Fairtrade
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Commodity Prices

• North/south divide
• End of 2002 to June 2003, price drop
• Machinery, pesticides and fertilisers price
  increased
• Unions on price
• Develop skills, less dependent

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Demand

• High demand for fair trade products
• Overall 20 to 30 6 years
• 46 increase
• Established and reputable suppliers
• Putting back into the communities
• Less dependent again
• Get out of poverty cycle

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One Conclusion

• Fairtrade brings benefits to communities that
  need it the most
• Allows the suppliers to become self sufficient
• Sets standards for companies
• May transform globalisation

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Another Conclusion?

• Although Fairtrade has its good points, such as a
  fixed regular income and an improved quality of
  life, it also has its drawbacks. Companies can
  exploit the farmers with ease, only importing a
  small percentage of Fairtrade supplies and still
  gaining there Fairtrade certification, this needs
  to be changed and standards set where companies
  have to import a set percentage to qualify as
  Fairtrade (something higher then 50).

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Any Questions?