- Origin & Cultivation
How fair is fair trade? Part 1.
„Fair trade“– sounds good, responsible and soothes the conscience if, like me, you have happened to reach very deep into the chocolate shelf. But very few people know what’s really behind it – at least that was my conclusion after a girl’s night including the chocolate.
Barbara Beiertz
“Fair” is like ‘sustainability’: vague and not protected.
It’s hard to believe, but it is in fact true: fair trade is NOT a legally protected term (nor is sustainability, by the way). “Organic” and ‘eco’, on the other hand, are and are therefore associated with clearly defined criteria
(you can find out more here: Is everything that claims to be organic actually organic? ). However, this also means that not everywhere that says “fair” is actually a fair price paid to the producer. Because that is the actual task of fair trade.
Creating better living and working conditions.
In principle, fair trade aims to establish a fair trading structure for farmers, small business holders and their families in the countries of the global South. This means that the farmers receive a guaranteed minimum price for their product – cocoa, coffee and bananas are the most traded – which is higher than the world market prices and makes them independent of the strong fluctuations. This enables them to feed their families with the proceeds and prevents child and slave labor.
However, since, as already mentioned, fair trade is not a protected term with precisely defined specifications, the different organizations also have different regulations. In general, they are based on the 10 principles of fair trade by the World Fair Trade Organization (WFTO) *01 – or at least they should be. However, one may ask how discounters manage to pay fair prices to producers with the dumping prices that they offer.
What do the different labels mean?
There are many fair trade labels out there, even from the various well-known retailers. To navigate this jungle and make informed purchasing decisions, it takes a bit of research. We have done that for you here and summarized it here.
The first very subtle, but nevertheless very big difference is between “Fair Trade” and “Fairtrade”. Fair Trade is everything, is the category and is not legally protected. Fairtrade (spelled together and with a small t) is probably the best-known label in the world and, according to the German Stiftung Warentest*, is definitely trustworthy. Let’s take a closer look at the criteria behind it.
Fairtrade :
Is a registered trademark. A circle with a blue and green field and a person in the middle. It is supported by the Fairtrade Labelling Organizations International (FLO), among others, which develops the standards for the label. Companies that comply with these criteria can have their products certified. Checks are carried out every 3 years to renew the label. Unannounced inspections are also carried out.
Main criteria for Fairtrade.
Social aspects:
- Forced labor, child labor and discrimination are prohibited.
- Tests that could cause discrimination (e.g. HIV tests, pregnancy tests) are also prohibited.
- Employees should be informed by their employers about their employment rights and receive employment contracts.
Economic regulations:
- Pays minimum prices.
“The Fairtrade minimum price is to be understood as a safety net, is intended to cover the average production costs for sustainable production and can be viewed on the Fairtrade International website. If the respective (world) market price is higher, the higher market price must be paid.” ** - An additional Fairtrade premium is distributed, the use of which for social, ecological and economic investments is decided jointly by the farming families/employees.
The ecological criteria are relatively loose:
- Environmentally friendly cultivation is “required”.
- Certain pesticides and herbicides are prohibited. Genetically modified seeds are also banned.
- Organic cultivation receives an “organic surcharge”.
Plus :
- Fairtrade products are physically traceable. However, this only applies to “pure” products such as coffee, bananas and rice.
- Cocoa, sugar, fruit juice, tea and mixed products, such as chocolate, which are mixed with conventionally traded products, are labeled “with volume compensation”. This means: “that companies may mix fairly traded raw materials with conventional products during processing, storage or transportation. They must document the exact quantity and cash flows along the supply chain. The independent certification organization Flocert GmbH checks this documentation. In the end, the companies are only allowed to label as “Fairtrade” as many goods as they have purchased Fairtrade raw materials.” ***
Although this “mass balance” is an approach to enable even very small producers to access the Fairtrade system, it is difficult for the average consumer to understand and may mean that a product certified as Fairtrade with mass balance contains hardly any Fairtrade ***. This is one of the major criticisms of the Fairtrade label.
Important to know:
Fair Trade USA (FTUSA) resigned from the global Fairtrade system as of 31 December 2011. The entire international Fairtrade system regretted Fair Trade USA’s decision to pursue its own approach rather than continue working within the international system.
Fairtrade America is the US member organization of Fairtrade International, and shares our commitment to a global system backed by credible, internationally agreed Fairtrade Standards and certification.
And what about Rainforest Alliance?
The little frog on the seal of the international organization is probably one of the most well-known certifications. If you look at their website, it states:
“Our robust verification system includes checks by independent auditors to be sure the farms that grow these crops, and the companies that source them, are meeting our strict certification requirements-which are all expertly designed to improve farmer incomes and well-being, as well as to regenerate the land.” (More information about Rainforest Alliance).
Sounds good. However, a German TV documentary from the fall of 2023 says otherwise:
“The seal often fails to keep its promise. The standards are low, the controls loose. Certified plantations can easily undermine them.” ****. The label has also been repeatedly criticized by Oxfam.
So much for the most trustworthy and best-known fair trade seals. In the next episode, “How fair is Fairtrade?”, we will look further into the criticism of Fairtrade. Whether and how justified it is, what alternative concepts there are. And what advantages an organic Fairtrade coffee such as our Single Origin from Papua New Guinea has. Just give it a try. The aroma of respect and care is phenomenal.
Sources:
* wfto.com/our-fair-trade-system/our-10-principles-of-fair-trade/
* www.zdf.de/nachrichten/ratgeber/fairtrade-siegel-produkte-glaubwuerdig-100.html
** www.fairtrade-deutschland.de/was-ist-fairtrade/fairtrade-standards/mindestpreis-und-praemie
*** www.lebensmittelklarheit.de/informationen/mengenausgleich-wo-fair-draufsteht-ist-nicht-immer-fair-drin
**** amp.zdf.de/nachrichten/wirtschaft/bananen-verbraucher-pestizide-fair-rainforest-alliance-100.html
