Fairtrade America exists to rebalance the terms of trade and deliver a greater share of the benefits to the farmers and workers we serve. Farmers and workers in Fairtrade regularly report that among certifications, Fairtrade delivers the most value.
Globally, 40% of all Fairtrade producer organizations sell more than half of their certifiable crop as Fairtrade. Increasing the percentage of production sold on Fairtrade terms helps deliver transformative change where people can enjoy a dignified livelihood and decide on their future on their terms.
The chart below shows the production capacity, sales, and percentage sold on Fairtrade terms for Fairtrade cocoa producers in the top five producer countries. Fairtrade’s global strategy for 2016-2020 seeks to deepen our impact by enabling producer organizations to secure the revenues they need for workers to be paid a living wage and for producers to earn a living income. Helping farmers build relationships with buyers and increasing the percentage they sell as Fairtrade is key to achieving this goal.
Fairtrade America’s core impact metric is the amount of Fairtrade Premium delivered back to farmers’ and workers’ organizations. The Fairtrade Premium is a set amount over and above the price paid for the raw product. This money gives producer organizations discretionary income they can invest in their businesses, their communities, and the local environment according to their priorities.
In 2015, sales from Fairtrade products in the US resulted in an estimated $5.28 million going back to farmers and workers, globally that figure topped $150 million. We believe that Fairtrade farmers and workers are best placed to determine their priorities for investment, which is why farmers and workers democratically decide how to invest the Fairtrade Premium they earn.
The Fairtrade Minimum Price plays an important role in helping farmers cope with the volatility of the market. Fairtrade sets minimum prices for most products that aim to cover the costs of sustainable production. Prices are regularly reviewed based on extensive consultation with a wide swath of farmers, traders, exporters and civil society actors. In 2015, the international coffee market highlighted the importance of the Fairtrade Minimum Price in providing stability to coffee farmers. Throughout much of the year, the NY ‘C’ price for coffee, an important market indicator, hovered well below the Fairtrade Minimum Price of $1.40 per pound.
In addition, to serving as a safety net for farmers in a volatile market, the Fairtrade Minimum Price is an important tool helping farmers attract much-needed pre-financing to bring their products to market. In 2016, Fairtrade International will release research on household incomes for coffee farmers conducted with True Price that will help us develop approaches to move toward a true living income.
In 2015, the international Fairtrade system strengthened our monitoring, evaluation and learning system with a digital data collection tool allowing us to generate better quality data from producers across a wide range of indicators. Fairtrade evaluates our overall progress against our Theory of Change that helps us analyze, learn and improve our approach.
During 2015, Fairtrade commissioned baseline studies on Fairtrade certification in the Banana Hired Labor Sector (PDF) and Fairtrade Cotton in West Africa (PDF). These studies help us develop a more accurate picture of the current situation for farmers and workers and allow us to measure progress over the years to come. This sets the stage for more robust impact assessments.
Fairtrade is more than 1.6 million farmers and workers around the world. Here are a few of their inspiring stories.