Global Fairtrade sales increase by 40% benefiting 1.4 million farmers worldwide
Bonn, Germany, 25 July 2007. Consumers worldwide spent 1.6 billion Euros on Fairtrade Certified Products in 2006, according to Fairtrade Labelling Organizations International (FLO). This is a 41% increase on the previous year, directly benefiting over 1.4 million producers and workers worldwide.
Impressive growth figures can be seen across product categories, but in particular cocoa has increased by 93%, coffee by 53%, tea by 41% and bananas by 31%. Fairtrade Cotton Farmers too have seen how the demand for their produce has more than doubled in just one year.
The growth in product sales was matched by an increase in the number of licensees (companies that sell the final packaged Fairtrade Products) in 2006 from 1514 to 1954, with some companies making major commitments to supporting Fairtrade. UK supermarket Sainsbury’s announced the conversion of its entire banana range to 100 per cent Fairtrade Certified last December. Marks & Spencer, another UK retailer, responded to its customers' desire for ethical products when it converted its entire tea and coffee range to Fairtrade in April 2006. Global retailer and franchiser Dunkin Donuts adopted a policy of 100% Fairtrade espresso coffee in Northern America and Europe. In September 2006, Insomnia Coffee Company in Ireland announced that all coffee served from outlets across the country would be 100 per cent Fairtrade Certified and Scandic and Hilton, one of Sweden’s major hotel chains, announced in October that it would switch all its coffee to Fairtrade.
“We would like to thank all the consumers and businesses which have supported Fairtrade in 2006. Through your daily purchases of Fairtrade Certified Products, producers and workers all across the developing world have received better prices for their crop as well as Premiums that allowed them to improve the livelihoods of their families and communities. We, Fairtrade Producers, will continue to work hard to provide the best quality produce to consumers with the hope that next year demand will continue to grow and that an even greater number of producers will benefit from this revolutionary approach to trade” says Binod Mohan, Chairman of the Network of Asian Producers (NAP), the association which represents Asian Fairtrade Certified Producers Organizations within FLO.
But the Fairtrade system delivers more to farmers and workers than sales alone. Fairtrade Standards ensure long term contract relationships between the producer and its buyer. This is absolutely fundamental in order for producers to be able to plan for their future.
Valentín Chinchay, member of a Fairtrade Certified Coffee Cooperative FAPECAFES, Ecuador, says: “In 2001 and 2002, during the world coffee crises, our situation was desperate. We received between 20-25 dollars per quintal… many of the Ecuadorian coffee producers left. We did not have any other choice but to abandon the coffee culture” . When FAPECAFES became Fairtrade Certified four years ago, in 2003, the difference that Fairtrade made was remarkable. “We are currently selling 80% of our total coffee production under Fairtrade terms. For our Fairtrade organic coffee we are receiving 139 US$ the quintal and 119US$ the quintal for our conventional Fairtrade coffee. But more important than the higher prices is the stability that Fairtrade brings. We are not as vulnerable to market volatility as we used to be” he adds. During 2006, FLO estimates that Fairtrade Coffee sales provided an estimated 41 million Euros more to Fairtrade Certified Coffee Cooperatives than selling their products under conventional terms.
But despite growing by on average 40% per year over the last five years, the Fairtrade market still has plenty of room for expansion. In fact, FLO estimates that approximately 20% of the total production of Fairtrade Certified Producers is sold under Fairtrade terms. FLO and its member Labelling Initiatives are working to open new markets and identify new business opportunities for producers so that Fairtrade Certified Producer Organizations can get to sell higher percentages of their production under Fairtrade terms in the future.
As Barbara Fiorito, FLO Chair of the Board of Directors, says:
“Above all, consumers increasing demand for Fairtrade Products means that more farmers are able to sell more of the their produce under Fairtrade terms, strengthening their organizations, building long-term relationships and increasing benefits to their communities”.
While recognizing the contribution Fairtrade has made to farm families over the last ten years, we cannot be satisfied. Too many producers all over the world continue to be victims of the unfair rules of international trade, often forced to sell their produce for less than the cost of production. Similarly, too many workers in developing countries endure low wages, insecure working conditions and are often denied the freedom to join a union. Besides continuing to lobby governments to make changes on international trade rules in favor of the poorest countries, incorporating Fairtrade Products to our daily shopping routine is a way to send a powerful message to industry and eventually force the conventional players and governments to rethink the impact of their business models and their policies. We need people to shout even louder, and we need companies to respond with genuine engagement. Otherwise millions of farmers will remain consigned to poverty. Fairtrade must become an everyday part of the way millions of people think and shop”.
Highlights in different Fairtrade markets in 2006:
During 2006, new Fairtrade Certified Coffee, Tea, Sugar, and Cocoa Products were introduced into the major Canadian grocery chains, including Costco, Loblaws, and Sobey’s. Via Rail, Canada’s national rail service, brought Fairtrade Certified coast to coast with its commitment to serve exclusively Fair Trade Certified coffee.
The new Irish Government, elected in June 2007, has made a commitment in the programme for government that will ensure that the sourcing of Fairtrade goods (where possible) is part of all Government departments’ purchasing policy’. Besides this, Sales for Fairtrade Certified goods grew by 75% in Ireland in 2006.
During 2006, new Fairtrade Certified Products, roses and jeans made out of Fairtrade Cotton, were launched in Italy.
In 2006, the Norwegian Fairtrade Labeling Initiative promoted Fairtrade through an ambitious art campaign. The project consisted of 33 sculptures of Fairtrade consumers which were placed in several supermarkets across the country. The campaign was very successful in raising awareness about Fairtrade among Norwegian consumers.
Fairtrade Certified Bananas continue to lead the market in Switzerland in 2006, representing 55% of the market share for bananas. Both Fairtrade Bananas and Roses were very successful with online shopping. Sales of products made out of Fairtrade Cotton, whose range was expanded, grew by 73%.
Fairtrade sale volumes increased by 63% in Sweden, reaching a total value of 16 million Euros. Fairtrade juice, sugar and wine were launched at Systembolaget, the Swedish state-owned monopoly shop for alcoholic beverages. During 2006 Scandic and Hilton hotels, one of Sweden’s major hotel chains, switched to 100% Fairtrade coffee. A new coffee chain concept was launched ”Barista Fair Trade Coffee" that only serves Fairtrade Products whenever possible.
Sales of Fairtrade Products in the UK rose to £293m in 2006, a 46 per cent increase over 2005. The Fairtrade Foundation hosted the first ever European Fairtrade Towns conference, opened by Richard Howitt MEP, European Parliament Spokesperson on Corporate Social Responsibility. Over 270 UK towns have received Fairtrade status.
Fair Trade Certified Coffee in the US increased 31% to 65 million pounds in 2006, a 20 million pound increase from 2005. Organic Fair Trade Certified coffee in the US grew 94%, and the estimated overall value of Fair Trade Certified coffee reached US $730 million. TransFair USA’s number of coffee licensees grew by 11%, tea imports grew by 22% and Fair Trade Certified vanilla was launched in the US. In addition, Pennsylvania became the first Fair Trade Town in the US, and major U.S retailers Sam’s Club, Starbucks, and Wild Oats Markets supported Fair Trade Month 2006.
You can download the FLO Annual Report by clicking here.
For further information, please, contact Verónica Pérez, FLO’s Communications Officer:
Tel: 0049 228 949 2314
Notes to Editors
FLO unites national Fairtrade Labeling Initiatives across Europe, Japan, USA, Canada, Mexico, Australia and New Zealand and producer networks representing Fairtrade Certified Producer Organizations in Central and Latin America, Africa and Asia. This independent consumer certification mark appears on products as a guarantee that disadvantaged producers are getting a better deal. Today, more than seven million people - farmers, workers and their families - across 59 developing countries benefit from the international Fairtrade system.