BONN, Germany - Despite the economic challenges in the past few years – including the effects of inflation, conflict, and climate change on the cost of global commodities – Fairtrade and its partners have found success in new strategies to move towards living incomes for farmers, according to a recent report from Fairtrade International.

The third Fairtrade Living Income Progress Report highlights the organisation’s comprehensive approach, which includes close collaboration with farmers, companies, and civil society organisations, and aims to share and scale up successful practices.

“The relief for farmers of current high global prices – especially for cocoa and coffee – has been offset by declining harvests in the past few years, preventing farmers from taking advantage of these market prices and improving their incomes,” said Carla Veldhuyzen van Zanten, Senior Advisor of Sustainable Livelihoods at Fairtrade International. “Farmers deserve to earn an income that supports their families with dignity. Now it’s even clearer that responsible procurement needs to go hand-in-hand with complementary producer support for there to be a viable and sustainable future for farmers and the products they grow.”

Fairtrade first launched its living income strategy in 2017. The organisation’s comprehensive approach to living incomes is focused on three key areas: sustainable production, responsible procurement (including paying farmers prices that support a living income), and building an enabling environment.

The area of sustainable production that falls under the remit of farmers and cooperatives includes tools and approaches that support farmers in adopting farming practices that improve productivity and resilience, especially in the face of climate change-related effects such as unpredictable weather and plant disease.

For instance, the report highlighted a new voluntary payment known as the “Yield Booster” that some retailers are paying to support cocoa producers in West Africa to adopt sustainable agricultural practices and increase their yields in order to reach the productivity benchmarks that underpin the Living Income Reference Price.

The Yield Booster, a payment of €245 per metric tonne paid on top of the reference price commitment, funds cocoa cooperatives to provide services to their farmer members, such as specialised pruning crews, and nurseries for shade trees and replacing old cocoa trees.

The Yield Booster is part of a holistic programme that addresses priority needs for reaching sustainable livelihoods.  In addition to Living Income Reference Prices, companies can invest in a range of programme components geared toward productivity improvement, farm and income resilience, child wellbeing, and more. Fairtrade began rolling out the programme in 2025 with several retailers, with more to be launched in 2026.

Meanwhile, the report showed growing commitment in the area of responsible procurement by companies. In particular, cocoa companies increased the volumes sourced from their suppliers at a Living Income Reference Prices during the 2024/2025 season by 60 percent over the previous year to nearly 32,000 metric tonnes, and the current year’s commitments are projected to result in another 50 percent uptick.  

The report also summarised the results to date of a review process that include a multistakeholder consultation to strengthen Fairtrade’s Living Income Reference Price model, focused on cocoa from Côte d’Ivoire and Ghana.

Plus, in 2024, Fairtrade launched an interactive online tool that makes it easier for companies to find out the prices they need to pay to enable living incomes. The centralised resource also includes details on how the prices are calculated along with the frequently asked questions.

Fairtrade also established two new options to expand relevant living income prices, including a customised LIRP for a company’s specific supply chain, and a rapid process to calculate a regional or national Living Income Reference Price, known as a “Living Income Reference Price on demand.”

Lastly in the area of the enabling environment, Fairtrade has continued to work side-by-side with partners to advocate for living-income-supporting policies and practices. This has included working with the Fair Trade Advocacy Office (FTAO) and engaging with European Union policymakers, producing specific guidelines to clarify company obligations under the European Union’s Corporate Sustainability Due Diligence Directive, and amplifying the voices of smallholder farmers and their representatives.

The report illustrated four examples of living income projects that Fairtrade developed with commercial partners in the past two years. They include Ben & Jerry’s Living Income Accelerator programme for smallholder vanilla producers in Madagascar; Swiss retailer Coop's living income commitments in a broad range of products, such as rice, cashew and mango; crop diversification contributing to income resilience in cocoa; and Pure Africa’s leadership in promoting living income-based prices in coffee from Rwanda, Uganda and Burundi.

These examples demonstrate how companies are taking their living income commitments further in partnership with Fairtrade cooperatives, such as paying Living Income Reference Prices and investing in programmatic support to producers.

Read Fairtrade’s full Living Income Progress Report here.