Early last month, Fairtrade International released its 2017-2018 annual report which indicated that purchases in the fair trade sector had reached an all-time high. This was seen by most – including myself – as a positive development due to the benefits fair trade offers producers in low-to-middle-income countries. For example, the report indicates that farmers and workers received an estimated 178 million euros in fair trade premium in 2017. For reference, fair trade premium is a portion of the money made in fair trade sales that is returned to producers in order to invest in community development projects. Few can deny that this is a good thing. In a world where over 700 million people live in poverty, receiving money to strengthen the capacities of their community is important. However, the promotion of fair trade within the agricultural sector is a distinct situation that must proceed carefully when it comes to the interaction between increasing sales and the environment. After all, maintaining a healthy planet is important to all of us.
What is fair trade?
Fair trade is an alternative approach to conventional trade and is based on a partnership between producers and consumers. Often conceptualized as an ‘ethical market’ space, the aim of fair trade is to ensure producers and workers are paid a fair wage, have equal employment opportunities, and receive financial and technical assistance in production. This is often achieved through several practices, including: fair trade products being purchased by a retailer directly from the producer, eliminating the profit that would be held by a ‘middle man’; a guaranteed fair trade minimum price that aims to ensure that producers can cover their average costs of production; and the existence of a fair trade premium (mentioned above), providing communities with the opportunity to purchase better equipment or machinery.
Fair trade and food production
Since 1991, food has become the most important category in the fair trade industry in terms of volume and growth of sales1. Fair trade food products’ equation with premium quality food allowed them to be an easy success in the mainstream market, as consumers aim to purchase better quality food when possible. The desired benefits of fair trade with regards to the agricultural industry include: alleviating extreme poverty through economic trade; empowering smallholder farmers and farm workers to use the relationships they’ve developed during trade to help expand the level of support they receive; and to promote the wider campaign for changes to the global economy and trade justice. Important as these may be, it is necessary to recognize that these aims are social in nature and do not directly address the treatment of the environment. This is a dangerous situation considering agricultural producers and workers depend on the environment for their livelihoods. If this category is going to continue to be the most important in terms of sales, it must be maintained carefully.
Fair trade’s environmental impact: the banana industry
Bananas offer an interesting case study of fair trade achievements and drawbacks as they are the world’s most exported fresh fruit1. Bananas have a relatively short life span so there is a need to get them from plantations to market shelves quickly. One strategy to do this is to increase growing efficiencies that allow for higher crop yields – that is an aim to produce more bananas and at a faster rate. While there can be multiple approaches to this task, many argue that this can be achieved via industrial monocultures (a practice of agriculture where only one crop is grown and it is grown on a large scale).
The argument for monocultures in fair trade is that a higher yield per hectare will increase the grower’s income1. In theory, this sounds great. More bananas means more money for fair trade producers; the same people living in various states of poverty or financial instability that the fair trade industry is trying to support. However, monocultural practices can be very harmful to the environment and it is therefore dangerous to rely solely on them as a way to increase yields. In order for monocultures to be successful, fertilizers, herbicides, and pesticides are needed to ensure that soils have the correct nutrients and that the crops are protected from disease and insects. In order to deliver these at the scale required for large monocultures, synthetic chemical versions have been developed.
There are several reasons that reliance on these chemicals can be harmful, including water contamination, soil degradation, and the establishment of long-term dependency on such products (please see the resources below for explanation of these complex arguments in more detail). Additionally, several studies demonstrate further weaknesses of monocultures such as a reduction in the biodiversity of the area surrounding the crops and findings which indicate that monocultures do not actually produce higher yields compared to traditional intercropping (several crops grown at once) or rotation cropping (a pattern of two crops grown within a year) practices.
So where do we go from here?
Despite my concern over the effectiveness of monocultures in fair trade production, I am not advocating for a shift away from the fair trade sector. The current alternative, the free trade market, is considered by many to be more destructive when it comes to environmental impact – not to mention the vast number of social harms it perpetuates (remember, it is fair trade’s aim to reverse most of these social harms!). Instead, I argue that the fair trade market must proceed carefully when it comes to the goal of continuing to increase sales like it did this past year. Ways to improve incomes for farmers and workers must pay special attention to the treatment of the environment and resist shifting to monoculture production. Only then can we start to evaluate the true success of fair trade.
More on fairtrade: https://www.fairtrade.net
What it takes for a producer/company to become fairtrade certified: https://www.flocert.net
Harmful effects of pesticides: https://www-sciencedirect-com.sheffield.idm.oclc.org/science/article/pii/S1462901106001092
Harmful effects of chemical fertilizers: https://www-sciencedirect-com.sheffield.idm.oclc.org/science/article/pii/S2212670812000486
- de Groot Ruiz, A., Fobeletes, V., Grosscurt, C., Galgani, P., Lord, R., Hardwicke, R., Tarin, M., Gautham, P., McNeil, D., & Aird, S., (2017). The external cost of banana production: a global study[online]. True Price & Trucost. [Viewed 3 November 2018].