What is Fair Trade?


Honey Bee Produce Company is celebrating October, Fair Trade Awareness Month

All information and photos courtesy of FairTrade America 

Fairtrade is committed to changing the way much of global trade works, which has put poor farmers and workers at a disadvantage.

Through better prices, good working conditions and fairer trade terms for marginalized producers in developing countries, we continuously work to change the status quo and make trade fair.

So, what is Fairtrade?

Overall, we are a global system that supports the small-scale farmers and workers who grow produce Fairtrade products so that they can have more control over their lives.

What does the FAIRTRADE Mark mean?

Choose a product labeled with the FAIRTRADE Mark and you know the ingredients in the product have been produced by small-scale farmer organizations or plantations that meet  Fairtrade’s rigorous economic, environmental and social standards.

These standards include paying the Fairtrade Minimum Price as well as the Fairtrade Premium, an extra amount of money that producer organizations invest in projects of their choice. For farmers, that can mean improving their business equipment or practices, while both farmers and workers can invest in community improvement projects that might include building schools, funding scholarships, improving sanitation, transportation , or healthcare, and creating a more safe and sustainable environment.

Fairtrade only certifies small-scale farmer organizations for some products, such as cocoa, coffee, rice and cotton. Farmers are able to have a louder voice and more bargaining power by joining associations such as farmer cooperatives.

For other products such as flowers, tea and bananas — where small-scale farming isn’t common — Fairtrade also certifies plantations. These large companies are required to meet standards protecting the basic rights of the people they employ, upholding decent working conditions, allowing collective bargaining and freedom of association, paying wages that move towards country-specific living wage benchmarks and preventing discrimination as well as bonded or illegal child labor.

Read more about Fairtrade’s Child and Forced Labor Policy here.

How Fairtrade is different

Fairtrade supports producers to gain more from trade and in this way they are empowered to take more control of their lives and livelihoods.

It’s a different approach based on partnership, connecting the people who produce our food with those who purchase and enjoy it.

Farmers and workers own 50% of Fairtrade

Fairtrade is a worldwide system that puts producers at the heart of everything we do. In fact, half of Fairtrade is owned by producers — which means they have an equal voice in decision-making on the Board of Directors of Fairtrade International as well as at our General Assembly. Farmers elect representatives from their own organizations who vote on the overall strategy, how to use resources and the setting of Standards, Premiums and Prices.

Fairtrade Minimum Price

The Fairtrade Minimum Price applies to most Fairtrade products, and acts as a safety net when market prices fall. This price is set in order to ensure that farmers can grow their crops sustainably. The minimum price paid depends what the Fairtrade product is and where it is produced. If the product’s market price is higher than our minimum price, the producer should receive that price.

FLOCERT, the Fairtrade system’s independent certification body, regularly audits and checks that the minimum price is being paid, ensuring producers are being fairly treated.

Fairtrade is unique in that it is the only certification scheme that offers the protection of a minimum price to producers. This enables them to plan for the future in the knowledge that they have a stable income for what they sell on Fairtrade terms.

Fairtrade Premium

On top of the Fairtrade Minimum Price, producers earn a Fairtrade Premium, a sum that is saved in a communal fund until farmers and workers democratically decide on how best to spend it, usually voting on this once a year.

Producers invest in projects to better their economic, environmental and/or social conditions. For farmers, it could mean investing in a better business tools, or helping them transition to organic production. For farmers and workers, education or health care for their families may be top of the agenda, or building much-needed infrastructure for their community, such as bridges and good roads.