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27 Apr 2020

Fairtrade Together: COVID-19 Briefing

Fairtrade is gathering updates from around the world about how COVID-19 is affecting producer organizations, family farmers, and workers.

The loss of livelihoods and risk of unemployment for farmers and workers is deepening throughout the Global South. Farmers and workers are already among the world’s poorest people, living in communities with weak or non-existent safety nets. This crisis is showing the critical role of businesses and retailers in supporting food security and ensuring the long term resilience of our supply chains.

Transportation challenges are at the forefront. There are growing reports of the impact of movement restrictions on the transport and export of goods, including reported shortages in packaging, transport drivers, market/auction closures and shipping / freight delays, shortage of shipping containers and challenges securing cargo flights. In some countries, these challenges are hitting producers already at the farm level, where they seek to process and get their products to market or to receive needed items such as fertilizer, seeds, or even food supplies.

Although the outlook for farmers, workers, and businesses continues to evolve, Fairtrade believes that it is crucial to take action now to ensure sustainable livelihoods and food supply chains. Governments, retailers, traders and consumers need to work together to protect jobs and livelihoods during this period and beyond.

Updates by product

Cocoa

The impact of COVID-19 on cocoa farmers is beginning to be felt throughout West African and Central/South America and Caribbean origins, with one of the main concerns being the continued reduction in the price of cocoa, by around 25 percent. Ghana’s cocoa revenue is expected to receive a shortfall of $1 billion, which will affect the entire sector.

As with other commodities, the transport and export of cocoa is likely to become increasingly challenging due to border closures.

There is a growing concern about the health risk for cocoa farming communities, who have a high rate of pre-existing health conditions resulting from poverty and poor nutrition as well as a lack of adequate healthcare.

Coffee

The current impact on the coffee sector varies depending on the origin country’s harvest season. Coffee from Central American and Mexico has already been harvested, but around 60 percent of the harvest of Fairtrade coffee, from Peru, Colombia and Brazil, occurs between April and August. If movement restrictions continue and farmers and workers are unable to reach coffee farms coffee production could be challenging.

The impact on coffee farmers in South East Asia is varied, but it is expected that impacts will increasingly be felt as border closures affect transport/export and the wider global economic downturn slows prices.

There is a perceived high health risk of COVID-19 in coffee growing communities, as the majority of coffee farmers live in remote areas, with limited access to health care facilities.

Bananas

While the banana sector has so far been relatively unaffected by the outbreak of COVID-19, increased lockdown measures in origin countries and logistics/transport challenges mean that it is likely that impacts will begin to be felt as the virus spreads and lockdown measures continue.

In the Dominican Republic, Haitian migrant workers who cannot return home due to border closures, are unable to apply for government aid since many lack necessary documents. Fairtrade certified organizations are taking steps to support stranded migrant workers including organizing food donations.

Flowers

The flower industry in all origins, including Kenya, Uganda, Ethiopia and Ecuador, continues to be severely impacted by the onset of the COVID-19 pandemic, with widespread job losses and reduced workers employed on farms only able to sustain minimal activity. Air freight is becoming an increasing issue, and many farms are reaching out to their customers for support in accessing cargo flights to Europe.

In Kenya, the Agricultural Employers Association (AEA) and Central Organization of Trade Unions (Cotu) have agreed to send home 50,000 workers without payment. Many farms are remaining open but with limited capacity and only a skeleton workforce on a rotational basis (i.e. the workforce has been divided into two groups, with farms paying workers 50%). Farms have estimated that they will only be able to sustain the current situation of heavily reduced sales for on average two months.

At least eight of the Fairtrade certified farms have used the increased flexibility of the Fairtrade Premium rules to use the money to distribute much-needed food packages and sanitizers, and some are even up-skilling laid-off workers through Premium-funded tailoring courses to create face masks for workers. Approximately 20,000 workers in Fairtrade farms are currently working on rotational terms and remunerated at half pay, in attempt to provide financial security and some stability until full operations can resume.

Tea

The tea sector has been seriously affected by the COVID-19 pandemic. Impacts were felt early, and are now deepening with cancellation of orders and shipping contracts, and significant delays to shipments worldwide. Some of the major tea buying auctions have been suspended and/or postponed. Others have moved online.

Impacts so far appear to have been most acute in Asia, and particularly in North East India, where it is currently peak harvest season. However, the increase in precautionary measures and lockdowns in East African producing countries, including Kenya, Uganda and Malawi, is likely to increase difficulties.

The response to the health crisis has so far varied by both national and state governments. As a result, some producers have already used the allowed flexibility in the use of the Fairtrade Premium to purchase masks, sanitizer and disinfectant, and, in some cases, to make cash disbursements or provide food supplies to workers.

Sugar

As with other commodities, the sugar sector is beginning to experience the effects of COVID-19 with lockdown measures and movement restrictions limiting labour supply and farm and processing operations, while border closures and export restrictions are also causing significant challenges for some producers. The immediate impact is being felt most acutely by those in harvest season, such as Malawi, as it is uncertain when harvesting can begin.

With COVID-19 now spreading in the Philippines, there is uncertainty especially for the vulnerable sectors - food insecurity and poverty are most severe among urban and rural marginalized groups, including women and youth. While some of the small producer organizations have supported their farmers through cash credits and distribution of provisions, there are smaller producer organizations with limited sales and lack of resources to support its members.

Cotton

Cotton is between crop seasons, so producers have mostly sold 80 to 90 percent of the cotton from the last season. In addition, 50 to 75 percent of the ginning is completed and around 25 to 50 percent of the cotton (raw or ginned) still lies with either the producers or the ginning units. When the market opens at a lower price, which is likely, farmers are very likely to see their incomes affected. The sector is also affected by the closure of ginning units and spinning mills as a result of various states of lockdown, resulting in a further loss of livelihoods for the sector. The sowing of the new crop typically starts in May, but this will be affected by the delay in the supply of seeds, as these are usually distributed by the end of April.

Wine

South Africa is the biggest supplier of Fairtrade certified wine in the world, and the industry is the country’s second largest agricultural export.

In response to an increase in the rate of infections of COVID-19, the South African government introduced a country wide lockdown on 27 March, which included a ban on the export of South African wines, and on the sale of alcohol throughout the country. Workers were however exempted from restrictions and farms are able to continue to operate following health and safety precautions. The South African government briefly lifted the ban on 7 April, but on 16 April announced the halting of wine exports and tastings.

The impact of this ban is causing producers significant challenges. There are 40,000 people and families employed on farms in South Africa. Despite workers being exempted from lockdown rules, prohibition of wine exports and of local sales means there is insufficient demand for the wine being produced. Without sales many producers will struggle to pay workers' wages.

How the Fairtrade system is supporting farmers and workers

FLOCERT: Some remote audits for producer organizations to resume

FLOCERT, the independent certifier for Fairtrade, announced new audit procedures effective 22 April 2020. FLOCERT had suspended all physical (in-person) audits in mid-March in response to the COVID-19 pandemic.

For producer organizations with audits scheduled through 30 June, FLOCERT auditors will be conducting these remotely, to the extent possible, based on a revised audit checklist. If remote auditing is not possible, the audits will be rescheduled until after 30 June. FLOCERT will assess the global situation closer to that date to determine whether physical audits can resume. Remote audits for traders have been ongoing, also through 30 June 2020.

More information is available on the FLOCERT website.

Fairtrade Together: How producer organizations and cooperatives are supporting members

• In Ghana, cooperatives like Asunafo North Farmers Union, West Akyem and ABOCFA cooperative have embarked on a series of sensitization efforts in their communities to help prevent the spread of the disease. Asunafo has been supporting a radio talk show for the past two years. Since the spread of the virus, they have started sensitization on COVID-19 to farmers through the radio show. ABOCFA has supported its members by donating sanitary kits such as soaps, hand sanitizers and sanitary equipment. The West Akyem farmer cooperative has supported its members and the community with informational posters on coronavirus preventive measures.
• In Côte d’Ivoire, cooperatives have also embarked on education campaigns partly with support from the national cocoa regulatory body, Conseil Café Cacao.
• In Madagascar, Association Theodore Vanille decided to use their Fairtrade Premium to buy and distribute soap for washing hands to its 83 members and families and vulnerable groups in their community who cannot afford to buy soap. This is an immediate response to the call by the prefect of Sambava that cooperatives should take part in awareness campaigns to fight against coronavirus.
• In recent weeks, Fairtrade and organic certified coffee producer in
  Uganda, Bukonzo Organic Farmers Cooperative Union Limited, has stepped in to support the local government task force on COVID-19. The cooperative used more than 700 euros from their Fairtrade Premium funds to purchase food staples and soap which they donated to the task force for distribution to vulnerable members of the community. “We want to be part of the people supporting those in need,” said Josinta Kabugho, the cooperative’s General Manager. Bukonzo Organic Farmers Cooperative Union has also set aside the equivalent of more than 1,300 euros for cash donations to staff, workers, and vulnerable farmer members, including the elderly, widows and persons with disability. The donations will be used for the purchase of essential items for their households and protective gear such as face masks and gloves.
• Producers in Pakistan have identified further actions to support farmers and workers during the country's lockdown extension through 30 April, when 11 Fairtrade certified producer organizations (including cotton, rice, sports ball, dried fruits) continue to remain closed. The organizations are promoting awareness building, distribution of masks, sanitizers, food and health relief packages. For instance, Masoom Sports Foundation, a Fairtrade rice producer, joined with trader partner Rice Experts to distribute 200 medical kits consisting of face mask, hand sanitizer, and gloves to the families of farmer members and the general community in five adjacent villages. The Masoom Foundation team volunteered to personally deliver it at the doorstep of the farmer members and communities and educate them on the precautionary measures to be taken at all times. Sports ball producers Bola Gema-Pakistan, Ali Trading and Talon Sports are also taking steps to protect workers' health and safety.

Belize sugarcane industry continues to operate, supporting farmers while safeguarding health

In Belize, farmers are continuing to harvest sugarcane, being careful to follow strict social distancing and hygiene precautions. Sugar supports the livelihoods of more than 40,000 people in the country, and their communities.

All three sugarcane farmer cooperatives in Belize are Fairtrade certified, covering around 5,400 farmer members. The cooperatives send their harvest to a sugarcane processing mill owned by Belize Sugar Industries Limited (BSI), a Fairtrade certified trader.

BSI has also started the distribution of locally made face masks to cane cutters, truck drivers, farmers, and harvesting group leaders. BSI secured and provided the materials for fabrication of more than 5,400 facemasks to women’s groups linked to cane farmer associations from the Orange Walk and Corozal districts.

This video captures the joint efforts of the Fairtrade certified cooperatives and the Belize sugar industry, and their determination to “keep on growing”.