Here's the facts about fair trade so you can make an informed decision next time you buy coffee, tea, or chocolate.
Disclaimer: This post is geared more towards coffee in particular, but the information still pertains to all fair trade products.
60% of coffee producers are small farmers who are unable to export their goods directly. They first have to sell to midlevel traders or resellers. The midlevel traders have a monopoly and can therefore buy the goods as cheaply as they please. The farmers have to go along with it. The midlevel traders sell the coffee at a much higher price than what they paid for it.
(image source: 15(ish) Things Worth Knowing About Coffee)
If you know anything about human geography, you'll notice that many of the countries in the bean belt are less economically developed countries, so exploiting them like the middle men do is a jerk move. Fair trade eliminates the midlevel traders, meaning that farmers can export their goods directly and at a fair price.
Fair trade has economic, environmental, and social benefits. It guarantees that more money goes to the farmers. Small farmers generally don't use harsh chemical fertilizers, pesticides, or herbicides, and they plant a variety of crops, which is better for the soil. It allows communities to build schools and health facilities, become more self-sufficient, and less dependent on aid.
Those are the basics. Time to look at the problems.
My biggest issue with it is that calling something fair trade can be misleading. Unless stated, you don't know if the seller is selling 100% fairly traded coffee, or only 50%. Starbucks claims to be selling fair trade products, when really only 3.7% of their coffee is fairly traded. That mere 3.7% is still allowed to fall under the fair trade umbrella.
“The people at TransFair [a non-profit fair trade organization] have said from day one that the more fair trade products that get sold, the better it is for the farmer, and I agree with that. On the other hand, if there is no differentiation between 100 percenters and the dabblers, customers get a misreading of what’s going on, and it lessens the integrity of the label.”
-Dean Cyon of Dean’s Beans, a 100% fair trade roaster in Massachusetts
Conventional coffee gives farmers 10 cents for every dollar whereas fair trade gives them 30 cents per dollar. Sounds great, but look at this:
It seems like we're missing something. Are the farmers getting 30 cents per dollar on top of these higher prices, or does it only seem like they're getting more money because of the higher prices? Or is there someone else getting money out of this that we're not seeing? Companies justify the higher prices saying it is compensation for the physical work the farmers do to hand pick only the ripest berries.
Fair trade encourages farmers to form co-ops to create democracy in an otherwise undemocratic society. This is great in theory; however, co-ops can be just as corrupt as any other organization. The farmers may not necessarily be getting a truly fair price. They receive whatever the co-op decides they should receive, and sometimes the co-ops get the better end of the deal.
Fair trade can also cause unemployment, for the midlevel traders primarily, but small fair trade coffee shops lose business when larger corporations or big brand names offer fair trade. This is upsetting, because more often than not, small coffee shops sell fair trade coffee because they believe in its benefits and not for monetary gain. When larger corporations sell it, it's for profit. They have a market that they can't reach unless they offer fair trade products.
Have you ever realized that language changes how we perceive things? That may come into play here too. The definition of "fair" is this: not favouring one more than the other; just; honest; according to the rules; clean or pure; without blemishes or errors; correct. Synonyms for fair include: decent, equal, lawful, reasonable, respectable, unbiased, equitable, legitimate, proper, square, trustworthy, and unprejudiced. These words play on our emotions. We hear words such as "fair" and we feel as though that is the best choice, or that we will be more globally considerate for buying that product. Even certain brand names fall under this point. For example, the fair trade brand Just Us is a play-on words of the word "justice."
So, should you buy fair trade or not? My answer is yes. Fair trade is a good idea and a better option, though it may not be as good as it makes itself out to be. Now you have the information you need to make an informed decision the next time you have to choose between fair trade and conventional products.