What does Fairtrade mean?

Everyone has seen the term Fairtrade on so many products. It immediately brings coffee, chocolate, tea and even bananas to mind. You may have seen it on the packaging of certain products or heard about it on their social media or website. You will probably recognise the logo for Fairtrade, and you'll know Fairtrade products are probably a good choice, and they do something right for people and the environment... but do you really know what it means. 

What does fairtrade mean

Spilling the beans about Fairtrade coffee

With so many labels on products now, it’s hard to know when a symbol really means something. Fairtrade means something. It is not a marketing gimmick for companies to increase prices. Instead, Fairtrade is precisely what these two words promise. It is fairness, in a tradeable product. 

However, fairness for whom? It is fairness for the producers, the manufacturers and YOU - the consumer. 

This post will spill the beans about Fair trade and provide FIVE reasons why we all should support Fairtrade products.

But first, let’s make sure we’re on the same page with what Fairtrade actually means...

What is Fairtrade?

Fairtrade seems like a bit of a no brainer. It covers responsibly sourced products. Who wouldn't enjoy their coffee a little bit more knowing the farmers that grew it, and the people that roasted it were fairly treated! Fairtrade certification means that products have gone through a rigorous test to ensure they have followed the Fairtrade standards. The Fairtrade movement initially began in the 1950's and has been developing and improving since that time. 

The Fairtrade standards encourage social, economic and environmental development for farmers and workers. Moreover, worker rights are ensured with the prohibition of forced labour and child labour. These standards fulfil six of the United Nations Sustainable Development Goals:

  1. No poverty
  2. Gender equality
  3. Clean water and sanitation
  4. Decent work and economic growth
  5. Responsible consumption and production
  6. Life above water (1)

In fact, Fairtrade may be larger than you think. Fairtrade producers operate in 75 countries and territories! There are 30, 000 available Fairtrade products and 1.7 million farmers and workers involved in Fairtrade around the world. (2)

Producers of Fairtrade products are paid a Fairtrade Minimum Price and Fairtrade Premium sums. The Fairtrade Minimum Price is the lowest amount of money that Producers can be paid for their products and remain the same even when market prices drop. They can also get the local market price if this is higher than the Fairtrade Minimum Price. 

The Fairtrade Premium is an extra sum of money which farmers and workers use to invest in the improvement of their businesses and communities. This sum can be used to build a hospital, purchase better farming equipment and even transition to organic farming! (3)

Okay - and now for the given reasons you should care about Fairtrade and make the switch...

1. Empowerment of producers and workers

Fairtrade empowers producers to have a voice to ensure that their needs are addressed and prevent exploitation.

Fairtrade organisations aim to eliminate poverty which closely aligns with the first goal of the United Nations Sustainable Development Goals. Workers can form a committee, participate in the board of directors and act as consultants so they can influence Fairtrade’s strategy, standards, prices and premiums. Fairtrade places the worker and consumer at the heart of its core values. Workers are protected from the worst effects of market volatility and have access to capital which they can use to improve the quality of their lives. They can even use their Fairtrade Premium pay to receive financial advice on contracts. 

Some of the core elements of the Fairtrade standards are training opportunities, non-discriminatory employment practices, adequate occupational safety and health conditions, and sufficient facilities for the workforce. 

Moreover, the Fairtrade Standards is slowly fulfilling the sixth goal in the United Nations Sustainable Development Goals - clean water and sanitation for all individuals. The Fairtrade standards stipulate that working environments and facilities must have accessible clean water and adequate sanitation facilities. These facilities must be provided if the worker’s housing is provided by the employer. 

2. Equality across genders and generations

The Fairtrade standards contain explicit requirements for workplace policies around sexual harassment and discrimination. All workers must receive equal pay and representation in the leadership and decision making power regarding the investment of Community Development Funds. 

Example 1 (4)

Koperasi Kopi Wanita Gayo (KKWG) coffee farming organisation is the first all-women coffee cooperation in South East Asia and Fairtrade certified. Most members found that they were able to express their voices and concerns more freely in KKWG than in other cooperatives dominated by male members or working beside their husbands. 

KKWG is composed of 470 members and sold more than 13 metric tonnes of coffee on the Fairtrade market in 2015. Previous to KKWG’s establishment in 2014, the members knew nothing about coffee roasting nor how to improve cultivation. Now, these women are being empowered to develop new skills. They spent their first Fairtrade Premium on cupping training and education on how to increase soil fertility. 

Members attribute to their rising sales due to their Fairtrade certification and combined with their good connections in the industry, KKWG will continue to prosper. 

Example 2 (5)

Wendy Rodriguez is the voice and face of Acopagro, a Fairtrade and organic cocoa cooperative. For more than 20 years, Acopagro has been helping its farmers to make their own way out of poverty in Northern Peru. Due to Fairtrade, farmers have electric lighting but running water is still on the agenda and is dependent on enough Fairtrade Sales. Prior to the founding of Acopagro, there was no cocoa and only cocaine. Farming families suffered from illegal drug trafficking, violence and threats. Wendy’s father worked in a bank where drug-trafficking money was laundered and killed after a militia raided her family’s home. However, Acopagro has helped to transform this formerly violent and drug-ridden community in Northern Peru. Last year, 1600 members of Acopagro took eyesight tests and 950 women participated in a health campaign for the prevention of uterine cancer. 

Example 3 (6, 7)

Women in Business Development empowers village economies to honour tradition and yet combine with modern technology while promoting fairtrade. This organisation works in 183 Samoan villages and incubates certified organic farming enterprises to improve the lives of individuals in this community. For instance, WIB supports women in Samoa to plan for the future of their daughters and their own. Coconut products are intergenerational businesses as they take six to ten years to start fruiting and peak production occurs at least 15 years. By developing a sustainable and Fairtrade business, these individuals are able to maintain a long-lasting and secure livelihood. 

In essence, Fairly traded products enable women to earn equal amounts of pay from their male counterparts and access more financial opportunities. 

3. Environmental impact

Fairtrade certified producers must follow environmentally sound agriculture practices. They must have minimised and safe use of agrochemicals, proper and safe management of waste, maintenance of soil fertility and water resources, AND no use of genetically modified organisms.(8)

Producers do not need to be organically certified but the Fairtrade organisations promote organic production and there is a higher Fairtrade Minimum Price for organically grown products. The Fairtrade Minimum Price helps to cover the costs of sustainable production and reduce the financial strain on producers. 

4. Market opportunity for manufacturers

Fairtrade products are the most recognised ethical label in the world. There is an increasing trend of consumers and businesses seeking out sustainable sourced products. Moreover, consumers have a more positive opinion of a product solely due to the label Fairtrade. According to 2015 GlobeScan research, eight in ten consumers say the Fairtrade mark has a position impact on their prescription of the brand. Moreover, Fairtrade has a global network of marketing organisations that can extend a manufacturer’s reach. 

Stable trading partnerships can be formed between the supplier and the manufacturer. Long-term business relationships can be facilitated as there is a mutually beneficial positive trade exchanged between these two parties. 

Fairtrade Theory of Change

Image credit: Fairtrade USA's Theory of Change (9)

5. Consumer

Fairtrade is a smarter and ethical choice. Consumers can be assured that the workers and producers are not exploited in the manufacture of this product. Some businesses reduce the wages of workers to competitively compete in the market. Fairtrade certification prevents this unsavoury business practice. Moreover, consumers will be supporting social, economic and environmental change through their purchase of Fairtrade product(s). Fairtrade manufacturers must ensure a sustainable transparent production of a service/product. 

We often don’t hear about the advantage of Fairtrade living in Australia, but now that you know the importance, look for the Fairtrade logo. 

In essence, Fairtrade products allow investment for the future. Producers can improve their livelihood and quality of life through the Fairtrade Premium wage.

Savvy Beverage’s Mental Performance Coffee pods is an Australian Fairtrade product that provides longer lasting energy, boosts mood and reduces stress! The coffee beans are sourced from Fairtrade, sustainable and ecological farms.

Savvy is a proud supporter of Fairtrade, and of our farmers. We ensure that our product is socially responsible. 

Consumers can rest assured that the workers and producers can receive an adequate and fair price for their goods (i.e. Fairtrade Minimum Price). Fairtrade standards promote social justice, equality and human rights. 

Now you've learned the importance of Fairtrade, so please look out for the logo and choose Fairtrade.