International trade may seem a remote issue, but when the price of a commodity like tea or coffee falls, it has a catastrophic impact on the lives of millions of small scale producers, forcing many into crippling debt and countless others to lose their land and their homes.
Products like coffee, tea and chocolate, that we in the north have come to depend on, are produced in the warmer climates of the south.
The prices paid for these commodities have not risen in real terms over the last forty years, whilst the value of fertilisers, pesticides and machinery (imported from the rich countries) has increased substantially.
So, many of the people who grow these crops have to work harder and longer for less money. On top of this, the market price of commodities frequently drops below the cost of producing them.
The low price of coffee in the early nineties had a terrible effect on the lives of millions of small farmers. Fairtrade aims to solve these problems.
- Pay a price to producers that covers the costs of sustainable production and living
- Pay a 'premium' that producers can invest in development
- Make partial advance payments when requested by producers
- Sign contracts that allow for long-term planning and sustainable production practices.
The Fairtrade Foundation is the UK national body which, by an independent social auditing system, verifies the Fairtrade supply agreement and code of conduct on Products that meet internationally recognised standards of fair trade.
Products from companies, which meet these strict controls, are awarded the Fairtrade mark.
The Fairtrade Foundation was set up by CAFOD, Christian Aid, New Consumer magazine, Oxfam, Traidcraft and the World Development Movement.
The Fairtrade Foundation, along with other national labelling initiatives, is responsible for both certifying Fairtrade products but also for continuing to monitor producers, importers and retailers qualifying to use the Fairtrade mark to ensure that the criteria are strictly respected.
The first Fairtrade marked product launched into the mainstream was Café Direct Roast & Ground Coffee in 1993. Café Direct is now the 6th largest coffee company in the UK with a £13 million annual turnover and is sold by most major retailers in the UK. Café Direct Roast & Ground holds a market share is 12% in this sector of the UK coffee market.
The UK market for Fairtrade marked goods has grown significantly - in 2004 to an estimated retail value of over £130m was spent by UK shoppers.
Consumers can now choose from over 700 UK Fairtrade products which include a range of fresh fruit, coffee, tea, sugar, fruit juice, honey chocolate, preserves, snacks, flowers and footballs.
The rapid growth in Fairtrade marked sales in the UK has also corresponded with an increase in the awareness of the Fairtrade Mark.
A 2004 MORI poll showed that the number of people who recognised the Fairtrade mark has doubled to 39% since 2002. For those who buy the Fairtrade products, 86% said the independent guarantee of the Fairtrade mark is important to them.