Fair trade - set for growth

Posted: 10 March 2003

Author: John Madeley

When the world price of primary commodities such as coffee, tea and sugar fall dramatically, it has a catastrophic impact on the lives of millions of small-scale producers. Many are forced into crippling debt; countless others lose their land and homes. Here, John Madeley tells the story of the Fairtrade movement, and of one woman whose life has been transformed by it.

The London-based Fairtrade Foundation exists to ensure a better deal for marginalized and disadvantaged producers in developing countries.

Set up by CAFOD, Christian Aid, New Consumer, Oxfam, Traidcraft and the World Development Movement in the early 1990s, the Foundation awards a consumer label, the Fairtrade Mark, to products, which meet internationally recognised standards of fair trade. The Fairtrade Foundation is one of 17 fair trade organisations in 14 European countries, the United States and Japan.

Fairtrade makes a real difference to people's lives, says the Foundation. "It challenges the conventional model of trade, and offers a progressive alternative for a sustainable future. And it empowers consumers to take responsibility for the role they play when they buy products from developing countries." Recent surveys in the UK suggest the majority of people would prefer to buy Fairtrade Mark products.

Coffee sales

The star Fairtrade product is the world's most universal drink - coffee. Sales of Fairtrade roast and ground coffee sales have grown enormously in the last ten years and now account for 14 per cent of the UK market, according to the Fairtrade Foundation.

The Foundation awards its Mark to companies, which give producers in developing countries a guaranteed price. Producers receive 126 US cents a pound for their coffee, around twice the current world price.

"Arguments that fair trade can never be more than a niche market have been disproved", says Harriet Lamb, director of the Fairtrade Foundation.

"In the context of an unfair global trade system, UK consumers are making a positive difference to the lives of tens of thousands of farmers in developing countries by choosing to buy Fairtrade coffee for the home, in the workplace and in coffee shops", says Harriet Lamb, "Fairtrade is a proven viable commercial model in which producers, roasters, retailers, and consumers can participate."

Fifty-three companies are now licensed to market products carrying the Fairtrade Mark in the UK. One of these, Cafédirect, is now the sixth largest coffee brand in UK. It sources coffee from Nicaragua

Blanca's story

Blanca Rosa Molina, coffee producer from Nicaragua.© FairtradeNicaraguan coffee farmer, Blanca Rosa Molina, bears witness to the difference that fair trade is making. "The most important thing about fair trade is that we know we shall eat tomorrow", said Blanca on a recent tour of the UK in 'Fairtrade Fortnight'. This is a special two weeks of the year when the general public in the UK is invited to hear more about fair trade.

Blanca farms three hectares of land in the Matagalpa region of northern Nicaragua, and is president of the Cecocafen cooperative of some 1,200 coffee producers. Like others members of the co-operative, Blanca sells about a third of her coffee in the Fairtrade system.

Blanca's parents worked on a large coffee farm in Matagalpa, and she joined them at the age of just six. About 60 per cent of jobs in the Matagalpa region are linked to coffee and the steep fall in world coffee prices in the last two years has hit people hard. "Most people who worked on large coffee plantations have lost their jobs", says Blanca. Many of them are now camping by roadsides to draw attention to their plight.

Access to credit

"The Fairtrade price allows us break even, to keep our land. It means our children can stay in school and that we can have the basic health provisions", says Blanca. "The price has enabled me to send my daughter to university and build my house bit by bit. It's a very humble house and I am still building. I took a loan from the co-operative, which has to be paid back within a year. But small producers, if they are not supplying the Fairtrade market, could hardly afford a house, and they have no access to credit."

Blanca has been selling some of her coffee for the Fairtrade price since 1994. And has been able to diversify production on her land, "which has given us greater food security."

"We hope that fair trade grows because there are many more coffee farmers in our region who would like to sell some of their crop through this system", she says. "We know the importance of producing top quality coffee so that the market keeps growing. Only the best quality goes into Cecocafen coffee. The emphasis on quality starts at the point of selection of the seeds."

Cecocafen members decide at general assembly meetings how to use the Fairtrade premium they receive. "Fairtrade is not just to benefit the individual farmers" stresses Blanca; it's to benefit the community as a whole. Fairtrade isn't only about buying and selling. It has a very important social aspect."

Social improvements

The co-operative has used the premium for social improvements, ensuring that children are going to school, for example, and that women are included in decision-making processes. The premium has also been invested in socially community projects such as water supply services, road building and buying medicines for the community.

A scholarship fund has funded further education for 70 children of co-operative members. A general credit scheme has been set up as a savings and loan programme for women. This is benefiting over 200 female members and non-members.

'We don't just want to see farmers who are selling under the trade system improve their own standard of living; we want the community as a whole to benefit. So our co-operative is teaching literacy skills to both adults and children, and we have done lots of primary health education', says Blanca.

'Community improvements are happening', she says, 'one community has used the premium to pay for a teacher. Others have ensured that young children receive nutritious foods'.

The Fairtrade premium has also been invested in processing facilities and a quality control laboratory. This has helped Cecocafen to develop and market its own roast and ground and organic coffee brands. The investment has created a new source of income for Cecocafen members, as the facilities are also hired to other producers.

When farmers become part of the Fairtrade system, "it is also easier for them to convert to organic, chemical-free production, because they have support in terms of training, advice on organic methods. The coffee premium allows farmers to carry out our soil and water conservation activities and helps to protect the environment", says Blanca.

Set to grow

She would like to sell more of her coffee through the Fairtrade system, "but that depends on the market expanding." Asked what her message is to people who buy coffee, Blanca says: "buy our coffee because it is the best quality. Not because we are poor farmers".

In addition to coffee, Fairtrade Mark products also include tea, cocoa, chocolate, honey, sugar, fruit juice, mangoes, bananas, rice, pasta, spices, snacks and biscuits, and also non-food goods such as clothes and footballs. More than 800,000 producers and their dependants in over 40 countries are now benefiting from the Fairtrade system and numbers are set to grow.

John Madeley is a freelance journalist and author. His most recent books are Food for All: the Need for a New Agriculture and Hungry for Trade, How the Poor Pay for Free Trade, Zed Press, 2002 and 2000, £9.99 ($17.50).