The 'International Fairtrede Certification Mark is an independent certification mark used in over 69 countries. It appears on products as an independent guarantee that a product has been produced according to Fairtrade political standards.
The Fairtrade Mark is owned and protected by Fairtrade International (FLO), on behalf of its 25-member and associate member Fairtrade producer networks and labelling initiatives.
For a product to carry the Fairtrade Mark, it must come from FLOCert inspected and certified producer organizations. The crops must be marketed in accordance with the International Fairtrade standards set by Fairtrade International. The supply chain is also monitored by FLOCert. To become certified Fairtrade producers, the primary cooperative and its member farmers must operate to certain political standards, imposed from Europe. FLO-CERT, the for-profit side, handles producer certification, inspecting and certifying producer organisations in more than 50 countries in Africa, Asia, and Latin America. In the Fair trade debate there are many complaints of failure to enforce these standards, with Fairtrade cooperatives, importers and packers profiting by evading them.
As of 2006, the following products currently carry the Fairtrade Mark: coffee, tea, chocolate, cocoa, sugar, bananas, apples, pears, grapes, plums, lemons, oranges, Satsumas, clementines, lychees, avocados, pineapples, mangoes, fruit juices, quinoa, peppers, green beans, coconut, dried fruit, rooibos tea, green tea, cakes and biscuits, honey, muesli, cereal bars, jams, chutney and sauces, herbs and spices, nuts and nut oil, wine, beer, rum, flowers, footballs, rice, yogurt, baby food, sugar body scrub, cotton wool and cotton products.
How it works
The marketing system for Fairtrade and non-Fairtrade coffee is identical in the consuming countries, using mostly the same importing, packing, distributing and retailing firms. Some independent brands operate a virtual company, paying importers, packers and distributors and advertising agencies to handle their brand, for cost reasons. In the producing country Fairtrade is marketed only by Fairtrade cooperatives, while other coffee is marketed by Fairtrade cooperatives (as uncertified coffee), by other cooperatives and by ordinary traders.
Retailers and cafes in the rich countries can sell Fairtrade coffee at any price they like, so nearly all the extra price paid by consumers, 82% to 99%, is kept in the rich countries as increased profit. There is however evidence that dishonest importers do not pay the full Fairtrade price, so an even smaller proportion reaches the Third World.
Cooperative traders and exporters can sell coffee as Fairtrade certified if they meet the political standards of FLO and they pay a certification and inspection fee. Other administration costs and production costs are incurred to meet these standards. The exporter (not the farmer) is paid a minimum price for Fairtrade certified coffee when the world market is oversupplied, and a Fairtrade premium of 15c per lb at other times. The cooperatives can, on average, sell only a third of their output as Fairtrade, because of lack of demand, and sell the rest at world prices. As the additional costs are incurred on all production, not just that sold as Fairtrade, cooperatives sometimes lose money on their Fairtrade membership. After the additional costs have been subtracted from the Fairtrade price, the rest goes on ‘Social Projects’ such as clinics, women’s groups and baseball pitches.
Farmers do not get any of the higher price under Fairtrade. Nor is there any evidence that they get higher prices as a result of better marketing: the cooperatives sometimes pay farmers a higher price than farmers do, sometimes less, but there is no evidence on which is more common. Farmers do, however, incur extra costs in producing Fairtrade, so they certainly do lose money from Fairtrade membership in some cases. There is little or no research on the extra costs incurred, or the effect of Fairtrade membership on the income of farmers.