The fallacy that is Fairtrade

By Phoenix Cronin

In just 10 years the UK’s coffee consumption has grown by 25 million cups per day. Credit: Pixels

In roughly six months, the price of ‘Fairtrade cocoa’ will rise by 20 per cent, going from $2,000 to $2,400. At face value, this is great news for the cocoa farmers who are involved in the scheme. But just how much will they benefit from the price hike?

Fairtrade originally had good intentions, the notion was simple, make trade fair and give producers a sustainable livelihood. The Fairtrade Foundation claims to ensure producers by covering their costs of production and providing financial stability by creating long-lasting trade relationships. They ensure a "floor-price" to their suppliers that are available to whoever joins the scheme, but farmers are struggling despite the Fairtrade certificate.

The guaranteed ‘floor price’ doesn’t cover production costs, as demonstrated by the Mexico protest against global conglomerate and Fairtrade certified Nestlé last December, where farmers claimed the corporate failed to provide any benefit to the local coffee farms there.

Similarly, Fair-trade encourages market oversupply causing diminishing global commodity prices which lowers the global coffee price. Seeing as in just 10 years the UK’s coffee consumption has grown by 25 million cups per day, it would make sense to infer that producers are also reaping the benefits, but they aren’t.

Fernando Morales, the founder of Café for Change, said that Fair-trade "certification" is a means of “defrauding consumers, it’s deceitful marketing, you [customers] are paying into a scheme where your money never reaches those who need it.”

He is not wrong – globally, coffee farmers are starting to steer away from Fairtrade, due to non-existent profit margins and suppressed cashflow, but after years of co-dependence, the change is proving tough.

Fairtrade needs to acknowledge these problems, it still can provide producers with healthy livelihoods, but the needed change seems unlikely in the foreseeable future, they need to return to their core values.

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