Fair trade has long been a beacon of hope in the global market, advocating for ethical practices and ensuring that producers in developing countries receive fair compensation for their efforts. Technology has become a powerful ally in the quest for… Read moreHow Technology Enhances Fair Trade Practices
The COVID-19 pandemic brought the world to a standstill, causing economic turmoil on a global scale. As countries grapple with the daunting task of economic recovery, there is a growing recognition of the importance of building back stronger, fairer, and… Read moreThe Role of Fair Trade in Post-Pandemic Economic Recovery
Fair trade certification promotes ethical and sustainable practices in global trade by setting standards for the production and trade of products, especially those from developing countries. It ensures fair wages and safe working conditions for producers, addressing social, economic, and… Read moreBenefits of Fair Trade Certification: Creating Ethical Supply Chains
The fashion industry has undeniably contributed to environmental degradation through harmful production practices that contribute to greenhouse gas emissions, water waste, and deforestation. One particular area that has caught the attention of environmental activists and conscious consumers is the shoe… Read moreFair Trade Shoes: Addressing Environmental Impacts in the Shoe Manufacturing Industry
The fashion industry is a $2.5 trillion industry, but the vast majority of the profits go to big brands and retailers, while smaller players in the supply chain often experience unfair wages and unsafe working conditions. Small producers, who often… Read moreFair Trade in the Fashion Industry: Benefits and Challenges for Small-Scale Producers
Source: Ethical Consumer How Fair Trade Ensures an Ethical Electronics Industry Conflict minerals are raw materials extracted from regions plagued by armed conflict and human rights abuses. These minerals, including tantalum, tin, tungsten, and gold, often end up in our… Read moreWhat Are Conflict Minerals and How to Avoid Them
Agrifood production refers to the entire process of cultivating, harvesting, processing, distributing, and consuming food and agricultural products. It involves farmers, producers, processors, distributors, retailers, and consumers, forming a complex global supply chain that is one of the largest in… Read moreThe Importance of Fair Trade Standards in Agrifood Production
Fair trade benefits certified farmers, but may not benefit the workers they hire.
A 2019 study found that farmers who are part of a Fairtrade cooperative (Fairtrade certified farmers) receive higher wages and better working conditions. However, farm workers they hire do not benefit from fair trade standards because their own wages are kept low. This may be because:
Farmers are not incentivized to increase farm workers’ wages and working conditions because they are not being adequately monitored by Fairtrade.
Labor standards may be unclearly defined, and thus are not enforced.
Smallholder farmers are often poor themselves and may be unable to pay higher wages, especially if they are not receiving significantly higher income as a result of fair trade certification.
Higher accountability is needed to ensure that fair trade is actually resulting in higher wages and more ethical labor conditions.
2. Fairtrade certification requires fees.
Fairtrade certification requires a fee that may be higher than small farms and producers can afford, especially if the certification does not pay off as intended. The cost of certification depends on the product, but in some cases, the fee can be thousands of dollars. This may exclude the poorest producers who need fair trade most.
For example, Fairtrade certification was around 6 cents/lb for coffee in 2006, with an annual fee of 3 cents/lb. This was not much lower than the amount farmers received as the Fairtrade premium.
3. Fair trade requires time and community investment.
Running a fair trade cooperative takes time and investment from community members who may have limited time to spare. Gaining certification is a time consuming process, which may discourage some small producers from seeking it out.
Becoming Fairtrade certified requires filling out an application online, working with the Fairtrade organization to get approved, upholding fair trade standards, and maintaining certification.
4. Fair trade products may be more expensive (but are generally competitively priced).
In some ways, this con is actually more of a myth. Some fair trade products are more expensive than traditional goods because the price is designed to support the workers. However, many fair trade products cost the same or only slightly more as other products, but a larger percentage of the sale price goes to producers. This is possible because fair trade organizations cut out middlemen who would normally take a percentage of the profit.
Some fair trade products like coffee may be 40% more expensive than conventional products.
5. Fair trade products must be globally exported.
Most fair trade products are sold in a country other than where it was produced, meaning that the products must be transported. This transportation of goods has a high carbon footprint. Some argue that eco-conscious consumers should focus on locally-produced products, rather than imported fair trade products.
In 2017, there were fair trade farmers in over 75 countries, and 30,000 Fairtrade Certified products were available in 150 countries around the world. While the spread of fair trade products is generally a good thing, it does increase the environmental costs of transportation and importation as compared to local products.
6. Buying fair trade may limit your options.
In many ways, the entire point of fair trade is to limit your purchasing options to only companies that engage in ethical practices. However, a downside is that fair trade is still growing and it may be difficult for consumers to find multiple fair trade options for products beyond coffee and tea. Buying fair trade means you will likely have fewer brand choices.
Over 322,000 small farms produced Fairtrade certified chocolate. There are far fewer options for other fair trade products, like neck ties or food containers for example.
Key Takeaways of Fair Trade Pros and Cons
While fair trade does have some challenges that must be addressed, such as increasing oversight and increasing the number of fair trade certified products, overall, the pros of fair trade outweigh the cons. Fair trade helps increase equality, ensure fair wages, living conditions and working standards, and promotes sustainable practices.
Fairtrade believes that digitalization and fairness are the way of the future. Here’s all you need to know about Fairtrade’s efforts to digitize fairness and ensure ethical fair trade standards are met. Fairtrade International aims to do so through their FairMarket strategy that focuses on the three “Ts”: traceability, transparency, and trading.
Almost 100% of the people I have spoken with about Fair Trade believe it is a good thing and they want to support it. The main reasons people don’t support Fair Trade are: They are unaware of what it is… Read moreYou Already Want Fair Trade (but don’t know it)
