Changes to Fair Trade in the US

As of December 1st, 2011, Fair Trade USA (FTUSA) decided to end its membership with Fairtrade International (FLO) to pursue its own approach rather than continue working within the global system.

FLO has a 20-year history of partnering with small-scale coffee grower cooperatives and working to set fair trade standards internationally. This hard work has resulted in a well-known ethical certification label recognized and respected around the world.

With bananas and other fresh fruits and vegetables, teas, and flowers, FLO works with large-scale farms to push for improvements in working conditions and worker empowerment. However, their approach when dealing with coffee is a little different:

"Recognising that 70 percent of the world’s coffee is produced by smallholders with less than 10 hectares of land, and that around 10 million small-scale coffee farmers depend on coffee as their primary source of income, feedback to date has been that the global standard for coffee should remain fully focused, as originally intended, on delivering market access on Fairtrade terms for smaller-scale farmers. We will continue to explore how we can expand our reach in this regard, focusing on partnership with producer organisations committed to democracy, transparency and empowerment." (Full article here.)

This is what Fair Trade USA has decided to change. According to Equal Exchange, a US-based provider of fair trade products:

"Without input from stakeholders, on January 1, FTUSA abandoned the global Fair Trade system (Fair Trade International, aka FTI) and loosened eligibility rules to allow large coffee, cocoa and sugar plantations to receive Fair Trade certification. That would put these large estates in direct competition with the hundreds of small-farmer co-operatives around the world who co-created the Fair Trade movement and have been the core of Fair Trade for over 25 years." (Full article here.)

Many people are concerned about what it will mean for small farmer cooperatives who have to compete with large plantations who don't need fair trade premiums to be profitable. Many are also concerned about the possible dilution of the meaning of "certified fair trade":

"The concern is that "large companies will use the fair trade seal to do what they call 'fair-wash,' to get the halo effect and perhaps confuse consumers about their overall practices," said Daniel Jaffee, an assistant professor of sociology at Washington State University who has studied the movement." (Full article here.)

Fair Trade USA, meanwhile, is defending its decision by saying that their changes will support fair trade for more people ("Fair Trade for All"). They are seeking to double their impact over the next three years and say:

"The key to adding value and growing impact is innovation. Fair Trade USA is innovating our model in three ways:  
1. Strengthening Farming Communities by investing in cooperatives and partnering with others to provide support services, with a focus on quality and business capacity  
2. Including More Farmers, Farm Workers and Communities in the benefits of Fair Trade
3. Engaging Consumers to increase market demand for Fair Trade Certified products and grow sales and impact"

(More information here.)

One of our suppliers is very committed to fair trade (they are our source for organic, fair trade bananas). When we asked them about this controversy, they had this to say:

"[We are] working with FLO, Fair Trade Federation, Fair Trade Resource Network, Domestic Fair Trade Organization, World Fair Trade Organization, Equal Exchange, North American Fair Trade Stakeholder Council, Fair Trade World and others (we're members of most of these) to find a way out of this mess, and we're hoping for some progress soon.  Ultimately, if we succeed in making some changes to certification, it will still leave Fair Trade USA out there as a rogue certifier, so the product will be in the marketplace, which will have some impact on us.  At this point, the new Mexican mega corporations that have been certified are selling their stuff only through Whole Foods - you can already see it at their stores, but I have no doubt it will be available on the open market.  ... at this point we're not happy selling it as Fair Trade because of the low standards that have been set for these large companies."

This supplier is intending to do a more detailed write-up about the changes to fair trade and the possible impact internationally and in Canada. Once they do that, we will post it here or link to it. In the meantime, we will continue to bring in fair trade products certified by FLO and continue to support small farmer cooperatives.