Fairtrade FAQ’s

What is Fairtrade ?

Fairtrade is a trading partnership which seeks greater equality across international trade by offering improved trading conditions to farmers and workers in the developing world.

 

How is Fairtrade doing?

In 2016 Kantar WorldPanel estimated the current size of the UK Fairtrade market as around £746m million per year at retail, up 7.1% year-on-year. Dynamics in Fairtrade change regularly as large brands move in (this year Mars – worth £30m at retail) and out (Tate and Lyle). Higher prices lead to a sales decline in previous years and retail prices are being pushed doiwn, but this is counteracted by shoppers purchasing more frequently and in larger quantities.

Over 240,000 new shoppers mean that 94% of all households are now buying into the Fairtrade market. Older, more affluet shoppers are the leading demographic, but growth is being driven by less affluent shoppers, with who Fairtrade confectionery has been a success.

Confectionery has 29.6% of the UK market by value, followed by fruit/veg/salads (24.5%) and hot beverages (23.9%). Brands curently have about 54% of the Fairtrade market, in 2016 own-label grew by 7.1% to achieve 46% market share. The Co-op achieved sales growth of +22.1% year-on-year, followed by Tesco (+4.3%), Sainsbury’s (+1.3%) and Waitrose (+4.5%)

YouGov research suggests that 55% of shoppers are likely to be influenced by the Fairtrade logo’s presence on a product but that 86% now recognise the logo.

 

What are the regulations covering the supply of Fairtrade products ?

Unlike organic production there is no statutory government or EU legislation concerning the production of Fairtrade food and drink. Instead Fairtrade International acts as an umbrella organisation for Fairtrade labelled products. Fairtrade International  is responsible for

  • Setting international Fairtrade producer standards
  • Agreeing terms of trade for Fairtrade products
  • Monitoring the trade in primary and part-processed products to ensure compliance
  • Owning the registered international Fairtrade symbol

 

What is the Fairtrade Foundation ?

In the UK Fairtrade International is represented by the Fairtrade Foundation (FTF) which

  • Licenses the Fairtrade logo for use on specific products
  • Monitors the supply chain of Fairtrade certified products
  • Helps companies develop new Fairtrade products
  • Raises consumer awareness about Fairtrade

What are the stages to becoming a Fairtrade supplier ?

  • The process of becoming a UK Fairtrade Licensee is controlled by the FTF. New applicants must fill out an Application Form and sign a Licence Agreement prior to marketing Fairtrade products.
  • The Licensee is responsible for ensuring that every product they market complies with Fairtrade standards.
  • The Licensee is generally the last supplier in the supply chain – in the case of proprietary brands this will usually be the brand owner whilst for private label. products the licence may be held by the brand owner or their immediate supplier.
  • Licensees pay a fee for the use of the Fairtrade symbol based on the net wholesale value of their sales in the preceding quarter. This fee is currently 2% for all products.
  • Once a Licensee has started supplying Fairtrade-labelled products they provide quarterly reports to the FTF to verify the supply chain and trading terms for labelled products.
  • These reports are audited annually by a physical inspection.

 

What is the range of Fairtrade food and drink currently available ?

  • Fairtrade International has currently developed Fairtrade standards which include the following types of food and drink: coffee, tea, herbal tea, chocolate, confectionery, cocoa, sugar, bananas, apples, pears, grapes, plums, lemons, oranges, mandarins, satsumas, clementines, lychees, avocados, pineapples, mangoes, grapefruit, fruit juices, smoothies, quinoa, peppers, green beans, coconuts, dried fruit, rooibos tea, green tea, biscuits, cakes & snacks, honey, muesli, cereal bars, jams & preserves, seeds, chutney & sauces, herbs & spices, nuts & nut oil, soya, olive oil, wine, beer, rum, rice, yoghurt, ice-cream and babyfood,
  • Non-food products include: flowers, sports balls, sugar body scrub and cotton products including clothing, homewear, cloth toys and cotton wool.

 

What are the guidelines for Fairtrade products ?

  • For all Fairtrade-labelled composite (multi-ingredient) products, every ingredient that is covered by Fairtrade standards must be sourced under Fairtrade conditions in a supply chain originating from certified producers and traded only through registered traders
  • If the product contains more than 50% Fairtrade-certified content then it is automatically eligible for Fairtrade labelling.
  • If the product contains less than 20% Fairtrade-certified content then it is not eligible for Fairtrade labelling.
  • A product may qualify for the Fairtrade logo if it contains a single Fairtrade-certified ingredient and this ingredient represents more than 20% of the product’s dry weight.
  • All composite products that carry the Fairtrade logo must indicate the percentage of Fairtrade ingredients on the product label.
  • In 2015 Fairtrade International launched the Fairtrade Sourcing Programme (FSP) for companies who cannot achieve full Fairtrade certification but wish to use a single Fairtrade-certified ingredient in their products. This currently applies to only cotton, sugar and cocoa.

 

What is the cross-over between Fairtrade and organic ?

  • Some products on sale in the UK carry both organic and Fairtrade logos, indicating dual-certification. The two systems are complementary but there are some key differences.
  • Organic standards seek to produce high quality food with minimum environmental impact, but they do not guarantee prices to producers or stipulate any particular social forms of production.
  • Fairtrade standards have a social goal, stipulating minimum prices paid to producers and ensuring that producers in developing countries can gain more control over their lives. Whilst environmental standards are important in Fairtrade, producers who are unable to meet organic standards are not excluded.