Phyllis, you wrote, “The Fair Trade Labelling Organization (FLO) does not differentiate between multi-national corporations, worker-owned co-operatives, or small independently owned businesses when applying the standards. As long as the purchaser is meeting the FLO requirements – mainly price paid to the grower – the organization is “blind” regarding the practices and values of the buyer.”

That’s true, but brings up an interesting point- like maybe FLO should differentiate. To me that would be the difference between “Fair Trade” in it’s current state, and “alternative trade”, where it all began, or maybe “poverty alleviation” and “economic transformation”. Worker-owned cooperatives trading fairly with small-farmers (organized in cooperatives) and community-owned retailers, or even small-independent companies and retailers- is truly an alternative economic model- a new system of trade based on equality, respect and shared social/environmental values. To me, it’s a sustainable alternative to the current global economic model- dominated by multi-national corporations, environmental destruction, and unabashed greed.

MNC’s will always have the same goal (profit) in mind- not actual, substantive change (economic transformation); even if their actions do, in fact, increase the income of producers.

Just something to think about.

Nicholas

I think the person you interviewed might be confused. The Fair Trade Labelling Organization (FLO) does not differentiate between multi-national corporations, worker-owned co-operatives, or small independently owned businesses when applying the standards. As long as the purchaser is meeting the FLO requirements – mainly price paid to the grower – the organization is “blind” regarding the practices and values of the buyer.

As to the question of purchases from small farmers vs. plantations, FLO makes the distinctions by product categories. To date there are only a few products that may only be sourced from small farmers – coffee and cacao being the primary ones. Unfortunately, for small banana growers, FLO allows bananas to be sourced from both small growers and plantations. (Forcing a co-op of small producers to compete with the likes of Dole and Chiquta.) Recently, we have been hearing of concerns from labor organizations about worker abuses and intimidation on some of these plantations.

It’s a complex issue and I encourage you to keep delving into it. (There are a few posts on this site about bananas and plantations; most recently the article reprinted from Peaceworks Magazine by Steven Coats. Good luck with your research – I’d be curious to learn of your other findings.

Phyllis

Let me first say, I apologize for not responding sooner. I appreciate your taking the time to comment. Fair Trade flowers are a very complicated issue within a very complicated industry. The modern flower industry is one of the most over-looked follies in first-world consumption and one of the most contentious on the Fair Trade Register.

Before I address Fair Trade flowers, I think there is a common misperception of cooperatives as inherently small or inefficient. There are some astounding examples of very successful cooperatives that compete head-to-head with traditional corporations; the Mondragon Co-operative is the seventh largest “corporation” in Spain and runs that country’s third-largest retailer. The Associated Press is a co-operative, owned by its media outlets. Ace Hardware is a co-operative with over $3 billion in hard-line sales every year. “Cooperative” refers only to an ownership structure.

In that regard, it’s false to say that it would be impossible for a small farmer co-operative to export flowers; it might be inefficient and probably not viable, for small-farmers, or anyone for that matter, to export flowers in small batches, but co-operatives, in the alternative trade model, are designed to overcome those circumstances in any given agricultural sector. It’s impossible for a meaningful percentage (barring a few specialty growers) of small farmers to export coffee in small batches because importers want full containers and there are a plethora of large-scale plantations available to fill them. Co-operatives re-create the “economy of scale” required to compete in the global market. If an organization or community of small farmers were growing flowers, I have to believe they could form a co-operative business to export them. Likewise, there’s no reason to suggest that a group of laborers could not run a large-scale flower operation as a worker-owned co-operative.

Regardless of working conditions in the flower industry of the developing world, flowers are a seriously frivolous export with unimaginably destructive environmental consequences. (That is not to say that coffee is one of life’s necessities, but within the auspices of the alternative trade model, it offers its growers (small farmers) access to foreign capital to invest in local economies, income diversification strategies and technological development, without, in most cases, replacing subsistence agricultural production). Furthermore, many small farmer coffee growers were born on coffee plantations or in areas dominated by the coffee sector, and have few options to get into other areas of work.

For a very informative look into the Fair Trade flower industry, I would refer you to an article in The Guardian.

Fair Trade flowers have become an economy that seriously threatens local eco-systems by diverting water and polluting the land with harmful pesticides and fertilizers. Large-scale, mono-crop economies are inherently more environmentally-destructive than bio-diversified farms and localized production, but our health-conscious, consumer-driven interpretation of “organic” also reduces the pressure on, as the Guardian points out, mainly foreign-owned flower companies, to improve their environmental impact (many, if not most, consumers opt for Fair Trade because they are hesitant to “consume” pesticides and fertilizers, not because of the environmental impact of the product).

The tremendous growth of the flower industry in the developing world is creating population centers in fragile ecosystems centered on unsustainable production methods… of flowers. In this case, it means that the “social premium” which can only be invested in community projects (Fair Trade does not dictate any wages except the minimum wage of that country) serves as an investment in a community that is not self-sufficient or environmentally-sustainable; much like the densely-populated slums that spring up outside cities as the rural sector is driven to indigence, and its population seeks employment opportunities in urban centers.

This scenario, of unsustainable, large-scale production in fragile eco-systems, is all too familiar, as it is the case in the majority of the world’s agricultural production. However, it seems exponentially more illogical that developing countries like Kenya or Ecuador, are destroying their land, rivers and lakes, while hundreds of thousands of farmers are leaving their land and relocating their families, so that Americans and Europeans can give their loved ones roses on Valentine’s Day.

You do bring up a valid point in saying that Fair Trade flowers offer employment to people who might not otherwise find work; but in many cases those people are farmers, and like David Gikundi, are leaving their land because they are not receiving a fair price for their products, such as tea. (This is partially because the conventional market is centered on mass-production and plantations, and in turn the Fair Trade system is being built to serve those plantations).

I believe that Fair Trade should aim to create an economic model that supports those small farmers, pays them a price that allows them to stay on their land, and values the sustainability of production and survival in any given eco-system. As the populations around flower economies continue to boom, thanks in no small part to the services paid for by Fair Trade premiums, the sustainability of these regions declines; their self-sustainability declines, and the future economic outlook for farmers, workers and their native countries, becomes even bleaker.

Again, there is no doubt that Fair Trade has brought improvements to the working conditions in the flower industry, but it comes at a cost. In the long term, I think “First World” consumers need to consider, holistically, the environmental, economic and social impact of the products they buy, regardless of “improvements” to production. Off-shore drilling may decrease our dependence on Mid-East oil, but it does not represent a comprehensive solution to the energy crisis; if Americans continue to drive gas-guzzling SUV’s and resist fundamental steps to decrease oil consumption, we, like millions of ”flower workers” and developing nations, will find ourselves in the exact same position in the future.

Barring an investment in land ownership, labor movements, economic empowerment and human development and education, (and perhaps not even then, given clear alternatives) it does not seem worth it to me to continue, if not exacerbate, environmental destruction and population displacement in the developing world so that Americans can enjoy floral arrangements year-round. We consumers, may need to make sacrifices (like flowers), but they are nothing compared to abandoning your land, family and community in search of a livable wage; and certainly maintaining a safe and healthy environment for our children is worth it.

Not sure why I just discovered your comment only now… Glad that Nick’s article was helpful in clarifying some of the issues. I’ll look forward to reading your posting on change.org… let us know when it’s up!

Phyllis

Great blog overall and great job, Equal Exchange.

In solidarity,
Zarah

Thanks for your question. I can’t actually recall what the certification fees are off-hand but certainly you could go to the FLO International (Fair Trade Labeling Organization) web-site, fairtrade.net, or call Transfair and ask someone there. It is true that the certification fees can place an additional burden on the coffee co-ops. Originally, as you probably know, this fee system didn’t exist. Without money coming into the system, certification of new co-ops was painfully slow. FLO was criticized for being a club that wouldn’t allow for the entry of new members. Certification fees were the response. The Fair Trade standards are rigorous and sending in monitors and inspectors does cost money. There has been talk of trying to find ways to merge organic certification with Fair Trade, even if only in certain criteria, to keep the costs down. I am also told that FLO has established a fund for those co-ops who would like to apply for certification but cannot afford the fees. Again, I don’t have any specific information, but I’m sure others out there can tell you more about this.

I don’t know the company or the farmers that you mention (and I did try to listen to your podcast, but couldn’t seem to access it), so I can’t speak to what or how they’re doing. In various of my blog entries, I’ve said that it’s my personal belief that supporting projects in farmer communities (providing of course that the need has been articulated by the community), can certainly be a positive step (with all the necessary caveats about HOW the project is planned and implemented), and that paying an above-market price will certainly be appreciated by any farmer. (And honestly, anyone who’s visited small-scale coffee farmers and seen first-hand the incredibly labor-intensive work that goes into growing high-quality coffee has to admit that even most of the highest prices being paid don’t seem enough.) Connections made and relationships established between roasters and farmers can also be a really human and poignant experience – often life changing.

The reason, however, that we choose to work with co-operatives is because we deeply believe that real structural change is needed – and at many levels – to balance the playing field, restore hope, and create strong communities where farmers have a choice to stay on their farms and thrive. I believe that Rodney North is planning to address your comment as well; and he has already written a series of reasons why we believe that co-operative structures provide one of the best opportunities for farmers to succeed, so I won’t go over any of that now. I’d just like to skip ahead and add that, and I’ve said it before, the power in many of these Fair Trade certified co-operatives with whom we work, is that by being organized the farmers have accomplished many things that individual farmers could never be able to do. These accomplishments may have nothing to do with coffee, or community projects… they have to do with building economic and political power… And only with that kind of power, can real change ever happen.

Thanks!

Phyllis