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Fairtrade certification

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For other uses of "fair trade", see fair trade.
Coffee

Fairtrade labelling (usually simply fairtrade, fair trade, Fair Trade or fair trade certified) is a brand designed to allow consumers to identify goods (especially agricultural products such as coffee) which meet agreed standards. The system involves independent auditing of producers to ensure standards are met. Companies offering products that meet the fair trade standards are licensed to use the fair trade label.

Background

A Fairtrade display of part of the range of products

The labelling of fair trade products began at the initiative of Mexican coffee farmers in 1988, together with Dutch development agency Solidaridad. Coffee imported to the Netherlands under fair trade principles was labelled by Solidaridad under the name of Max Havelaar. This fair trade labelling system is today known as "Fairtrade" or "Fair Trade Certified", includes the Max Havelaar and TransFair labels, and is governed by Fairtrade Labelling Organizations International (FLO). Although beginning with coffee, the FLO Fairtrade certification system covers a growing range of products, including bananas, honey, oranges, cocoa, cotton, dried and fresh fruits and vegetables, juices, nuts and oil seeds, quinoa, rice, spices, sugar, tea and wine.

File:Fairtrade logo1.gif
File:Fairtrade logo2.gif

Standards are set by the FLO on behalf of a number of national bodies (such as the Fairtrade Foundation in the UK) for each type of product. Typically standards cover labor standards, environmental standards, and stable pricing. A common feature is for standards to set a long-term minimum price (typically considerably above the long-run average market rate) based on the incomes needed to sustain the small farmers products should be sourced from (often via co-operatives). They may include an additional "social premium" above the market price designed specifically to support community projects such as schools. Products that are certified to meet the standard may for a fee display the appropriate Fairtrade symbol on their packaging. (The fee supports the work of the national monitoring body.) Although originally each country had its own Fairtrade symbol, an international standard has been agreed which is slowly being adopted.

There are currently national certification and standards bodies in 19 countries, as well as an international organization (Fairtrade Labelling Organizations International, FLO) to coordinate policy. FLO exists to promote products which are produced and sold in accordance with its definition of fair trade, called the FINE definition. FLO holds the trademark to the Fairtrade™ label in Europe, while the Fair Trade Certified™ label is trademarked by TransFair USA.

There are also other organizations and certifications which are not part of FLO, including Rugmark (carpets), Clean Clothes Campaign,Made-by (clothing) and Jambohut (handicraft). Major distributors of Fairtrade products today include, Dritte-Welt Partner, Traidcraft, and Cafedirect.

Progress

In 2004 there were around 400 certified producer organizations representing 800,000 families in 45 countries, and over 550 companies licensing the FLO Fairtrade label. The countries with highest spending per capita on Fairtrade-labelled goods are Switzerland and the Netherlands. Global sales are expected to reach $1bn by 2007. In the UK, the most significant single Fairtrade product is coffee, where Fairtrade brands have 18% of the roast and ground coffee market and 3% of all coffee sales.

Although Fairtrade products are typically somewhat higher-priced than equivalent non-Fairtrade goods, for many products (e.g. coffee, bananas) the difference is relatively small (as long as sufficient volumes are involved). This is because although a considerable premium may be paid to the producers (often 50-100% above market rate), this forms only a small part of the final product price (typically less than 10%); most of the price is determined by transport, distribution and other costs. (However, for some Fairtrade products such as toys, the producer cost is a considerably greater proportion of the total.)

Nestlé controversy

Partners Blend coffee, launched by Nestlé during 2005, has obtained Fairtrade labelling status, although this decision has been dismissed as a "Big Joke" by an unnamed Colombian trade union activist . Nestlé has been the subject of a consumer boycott campaign for a number of years due to their allegedly unethical business practices (see Nestlé boycott). Baby Milk Action, an organization campaigning to raise awareness of this boycott, have also issued a press release criticizing the decision to award Nestlé the Fairtrade mark .

See also

External links

FLO members

Fairtrade Labelling Organizations International member organizations:

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