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Is Fair Trade a Fair Deal?

Fair trade goods are more costly, but not always organic

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The TransFair USA mark is the most common U.S. fair trade logo.

TransFair USA

The term "fair trade" describes a system of commerce that promotes a sustainable environment, labor rights, a good wage and healthy working conditions for laborers as well as their families and communities. Often trading in products from developing countries, advocates of fair trade believe it's an ethical alternative to other, more exploitative forms of capitalism.

The basic principles of fair trade include:

  • A fair, living wage for laborers
  • Direct trade that eliminates middlemen
  • Safe, healthy working conditions
  • Environmental sustainability
  • Respect for cultural identity
  • Community development
  • Opportunities for marginalized communities

Fair trade first entered the global marketplace in the 1940s through the efforts of religious groups like the Mennonite community and a handful of non-governmental organizations. At the beginning, most of the goods traded were handicrafts, artwork and other non-perishables sold in specialty shops and at church functions.

Fair Trade Coffee Is Key

With the support of organizations like Oxfam and the United Nations, the demand for fair trade products gradually increased during the 1960s and 1970s through shops in Germany, Great Britain, the Netherlands and other European countries. Many fair trade retailers expanded their product lines in the 1990s to include agricultural goods like tea and coffee.

Coffee, in fact, has proven to be the key to fair trade's phenomenal growth: between 2000 and 2005, sales of fair trade coffee increased from $50 million to $500 million in the United States alone. Starbucks bought 50 percent more fair trade coffee in 2006 than it bought the previous year.

Today, with continued expansion into markets in North America, Asia, Australia and elsewhere, the variety of fair trade goods that are available has exploded. In addition to coffee and tea, consumers can now buy fair trade:

  • Sugar and spices
  • Dried fruits and nuts
  • Chocolate and cocoa
  • Rice, quinoa and other grains
  • Fruit juices and honey
  • Wine
  • Fresh fruits and vegetables
  • Cotton and cotton clothing
  • Flowers
  • Artwork, apparel and handicrafts

The exponential success of the fair trade movement has not gone unnoticed: Wal-Mart, Sam's Club, Whole Foods and other retailers have expanded their inventories of fair trade products. Even fast-food merchants like McDonald's and Dunkin' Donuts are selling fair trade coffee.

Currently, there are two main organizations that certify products as fair trade. TransFair USA is the primary certification body for goods sold in North America; they carry the Fair Trade Certified logo. Elsewhere, the Fairtrade Labeling Organizations International (FLO International) and their certification body (FLO-CERT) oversee the use of the Fairtrade Certification Mark.

Fair Trade or Organic?

Consumers should be aware that fair trade products aren't necessarily organic, though some may have earned organic certification. Fair trade fruits, vegetables, coffees and teas, for example, may contain pesticides or be grown with the use of synthetic fertilizers.

Fair trade goods also aren't the cheapest items on the shelf -- fair trade coffee, for example, usually isn’t as inexpensive as commercially grown coffee, but its price is similar to that of gourmet coffees. Market research has confirmed that many consumers are willing to pay more for fair trade as well as organic and other high-quality sustainable products.

Proponents of fair trade goods say that any additional price is a reflection of the many benefits of the products: environmental protection, better and safer working conditions, and access to health care and education for workers and their families. Some critics, however, have charged that fair trade workers are not paid much more than other workers, and that complying with strict rules for fair trade certification is difficult for small farmers and artisans.

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