What does the Fairtrade Mark mean for the producers?

Producers in the developing world benefit from being Fairtrade certified in two key ways.

The Fairtrade Minimum Price is just that – the lowest possible price. When the market price is higher, the producers are paid in line with this. A minimum price is important because it gives the producers certainty that they will be able to at least cover the cost of production. Think of the protests from UK dairy farmers when the price of milk is set below the cost of production. The same thing is all too common in developing countries where small producers do not have a voice to make their case heard.

Nelson Huanca Solis is a quinoa farmer in Bolivia. He is a member of Anapqui, an umbrella organisation of seven regional cooperatives which supplies the quinoa used in Traidcraft’s Fairtrade pasta. He says, “I joined the co-op because the benefits were clear to me. Price is the most important thing because it is higher.”

The Fairtrade Premium is a sum of money that is paid in addition to the agreed Fairtrade price. It must be used for investment in social, environmental or economic development projects. Typical examples are education, healthcare, improvements in farming methods and processing facilities. Each group of producers chooses democratically how their premium will be used.

Joyce Chibouro is a sugar farmer in Kasinthula, Malawi. Sugar from Kasinthula is used in Divine chocolate bars. She talks about how the Fairtrade Premium has been used locally, “The village where I live has one borehole [for water] and receives electricity. It is very exciting. We never believed this would be possible!”

Furthermore, the companies that buy Fairtrade certified produce are required to pay part of the price in advance if the producers want this; and to sign contracts which allow for long-term planning and sustainable production practices.