Fair Trade has been a passion of mine since I began working with farmer cooperatives in Peru and Belize in 2007. Originally, I went to the Amazon to conduct linguistic research, but was struck by the limited opportunities indigenous people face in an increasingly globalized world. I would frequently wake up in the morning and hear chain saws cutting down hardwood trees so families could get a few bucks to send their kids to school. I recognized the need for sustainable economic opportunities that would allow producers to get themselves out of poverty.
Although it’s an increasingly controversial issue that I look forward to addressing in depth over the course of my next few posts, my own experience and research has shown Fair Trade to be an effective, efficient, and meaningful way to benefit producers. Moreover, retail sales of Fair Trade products worldwide are now estimated to be more than $5 billion, and with global leaders like Unilever and Target jumping on board, it’s worth questioning whether or not we’re in a mainstream pick-up phase.
Before we get too deep into the who’s, how’s, and if’s of Fair Trade, let’s get some basics straight:
Brief history of Fair Trade
• 1940s – Fair Trade began modestly when a few small North American and European organizations reached out to poverty-stricken communities to help them sell their handicrafts to well-off markets
• 1969 – First “worldshop” opened in the Netherlands – goods began to be produced under Fair Trade terms in developing countries
• 1988 – First Fair Trade certification initiative in the Netherlands – Max Haveelar (Mexican coffee farmers and faith-based NGOs)
• 1998 – TransFair USA (now Fair Trade USA), founded by Paul Rice
• 1999 – Fair Trade coffee launched
• 2001 – First Fair Trade tea certification began
To capitalize or not to capitalize
Definite confusion exists around this issue. “Capitalized Fair Trade” most commonly refers to the certification standard developed by the Fair Trade Labeling Organization (FLO) and is applied to all FLO-certified producers and products. “Fair Trade,” when used in conjunction with FLO’s consumer seals, is a trademark of the organization, but the simple term “Fair Trade” is not trademarked or protected (contrary to popular belief).
“Fair Trade” generally refers to all initiatives and certification standards with the goal of benefiting producers beyond the market norm.
Fair Trade and Free Trade are the same thing
According to Fair Trade USA’s founder Paul Rice, “Fair Trade makes free trade work for the world’s poor.” Fair Trade aims to address the underlying inequities caused by poverty and lack of access to market information that free trade ignores.
(Note: I’m constantly shocked at how frequently I see both tea and coffee industry professionals refer to “Free Trade Tea”)
Producers must be small, family-based growers to become Fair Trade certified
While it’s commonly believed that Fair Trade only supports small farmers, the majority of Fair Trade-certified tea on the market is actually grown on plantations (whereby the workers gain additional benefits as opposed to the family farm). 2010 estimates from the two leading Fair Trade certifiers (Rainforest Alliance and Fair Trade USA) are shown here.
Part 2 will focus on market trends and the growth of Fair Trade-certified teas.