1) What is Fair Trade?
The Fair Trade Association of Australia and New Zealand has adopted the internationally recognized and accepted definition of fair trade. This was created by FINE, an informal association of the four main international fair trade networks:
“Fair trade is a trading partnership, based on dialogue, transparency and respect, that seeks greater equity in international trade. It contributes to sustainable development by offering better trading conditions to, and securing the rights of, marginalized producers and workers - especially in the South. Fair trade organisations (backed by consumers) are engaged actively in supporting producers, awareness raising and in campaigning for changes in the rules and practice of conventional international trade".
FTAANZ supports two systems of fair trade – the FLO system (the FAIRTRADE product Label) and the IFAT system, which accredits Fair Trade Organisations. This info sheet is about the Fairtrade labelling system. To find out more about the IFAT system, visit www.fairtrade.com.au/IFAT
2) What is the FAIRTRADE Label?
The FAIRTRADE Label is an independent consumer certification label which appears on products as an independent guarantee that disadvantaged producers in the developing world are getting a better deal. As a result of Fairtrade, these producers receive a minimum price that covers the cost of sustainable production and an extra premium that is invested in social or economic development projects.
For a product to display the FAIRTRADE Label it must meet international Fairtrade standards. These standards are established by FLO International e.V. and are set in accordance to the requirements of the ISEAL Code of Good Practice in standards setting. They are in addition the result of broad consultations of different stakeholders and external experts. Producer organizations that supply Fairtrade products are then certified against these standards by FLO Cert GmbH, an independent certification body, which carries regular inspections.
The Fairtrade labelling system began in The Netherlands in 1989, and currently operates in 20 countries. It was introduced in Australia and New Zealand in 2003.
3) Who benefits from the Fairtrade labelling system?
Fairtrade provides tangible benefits to small-scale farmers and workers, consumers and the environment.
Small-scale Farmers and Workers: The Fairtrade system benefits approximately 1 million workers and farmers in 58 developing countries in Africa, Asia and Latin America. Including their dependents, fivemillion people are affected. Fairtrade certification allows them to achieve economic independence and empowerment while improving their standards of living.
Beyond being paid a fair price for their produce, Fairtrade Premiums enable producers to better their communities by providing:
• Improved access to low or no-interest loans
• Technical assistance for building infrastructure to improve production
• Communications systems, and collectively-owned transport and processing equipment
• Better health care and education
• Technical training and skill diversification for cooperative members and their families
Consumers: The Fairtrade system benefits consumers by:
• Giving them the option of purchasing according to their principles and values,
• Empowering them to be a player in the solution to global trade inequities
• Providing them with products of superior quality
• Assuring them of the ethical source of their food and non-food purchases
Environment: Fair Trade rewards and encourages farming and production practices that are environmentally sustainable, such as:
• Integrated farm management systems which minimize pollutants, pesticides and herbicides
• Organic agriculture techniques
• Banning the use of dangerous pesticides
4) What Fairtrade certified products are available?
In Australia and New Zealand, the main Fairtrade certified products available are coffee, tea, chocolate cocoa, cotton and sportsballs. Some retailers also stock a few other food products such as rice and quinoa.
5) Are Fairtrade certified products also organic?
Not necessarily. Fairtrade criteria however require sustainable farming techniques, and offer an extra Premium for organic production. Revenues from Fairtrade cooperatives are often used to train producers in organic and sustainable techniques like composting and integrating recycled materials.
6) Do Fairtrade certified products cost more?
Not all Fairtrade certified products cost more than conventional products. Where the Fairtrade certified products do cost more, there are many factors to be considered. Often they are of a superior quality due to their organic farming practices. There are other factors such as scale of economy. Production of smaller quantities can often cost producers and processors more at every turn (packaging, transport, etc) because they cannot benefit from a large enough scale to use as a bargaining position. Finally, retailers make the choice to set the final price to consumers. Retail pricing is not controlled or influenced by FLO or any of the National Initiatives. The National Initiative verifies the minimum guaranteed price has been made to the producer but the final price asked of the consumer is solely the decision of the retailer.
7) How big is the Fairtrade market?
In 2005, sales of Fairtrade labelled products amounted to approximately $1.8 billion worldwide, a 37% year-to-year increase. As per December 2005, 508 certified producer organizations in 58 developing countries were Fairtrade certified. That represents more than one million producers and five million people, including dependents, benefiting from Fairtrade. In Australia in 2005/06, retail sales of Fairtrade labelled products amounted to approximately $5.4m – an increase of 157% over the previous financial year.
8) How can I tell if a product is Fairtrade certified?
Look for the Label - Fairtrade certified products always have the FAIRTRADE Label on the front of their packaging.
9) Where can I buy fair trade products?
Check out the Fair Trade Association website at www.fairtrade.com.au/buyandsell for a searchable database of stockists. You can also download our procurement guide, which lists sources for businesses.
10. How can I find out more, and get more involved?
Check the "Get Involved" menu on our website to find out about how to get involved locally through Fair Trade Communities, Fair Trade Fortnight and our other options – www.fairtrade.com.au
For further information, please contact aust@fta.org.au or phone 03 9662 2919 in Australia or info@fairtrade.org.nz or phone 09 920 4950 in New Zealand.
