“What is clear and seems to be difficult to understand in the North is that a producer organization can never compete with a large plantation.” Santiago Paz, Co-Manager, CEPICAFE (The Piuran Coffee Growers Association), Peru
“Fair Trade, in Fair Trade USA’s scheme, doesn’t mean anything. In order to increase the market share, they have allowed large and small players in the system; organized producers and those who are not organized; good products and bad products. What is the message that this is going to send to consumers? In wanting to make everything Fair Trade, we are left with no message. Fair Trade means nothing.” Santiago Paz
When TransFair/Fair Trade USA chose to disregard the wishes of Fair Trade producers, Alternative Trade Organizations, activists, and other long-time actors in the Fair Trade movement and leave the international system to create their own “Fair Trade” certification system which includes plantation coffee and cacao, justifiably they angered many Fair Traders.
On the surface, it’s hard to argue with an initiative entitled, Fair Trade For All. I mean who doesn’t want producer empowerment for all farmers everywhere? The trouble is that once you go beyond the catchy name, you quickly bump into two stark realities. 1) Despite their claim that this initiative will benefit farm workers and small producers, Fair Trade is a model which works for those who own and run their businesses. In the case of small farmers, fair trade builds support for co-operatives and other associations. If you add plantations into the Fair Trade system, the benefits of the model will go to plantation owners, not the farm workers who toil in the fields and groves. So it is important to compare small farmer co-operatives (where the farmers collectively own and run their business) with plantation owners (where one person, or a corporation) owns the business.
Historically, Fair Trade was created in recognition of the fact that plantation owners already receive tremendous support from government subsidies, agriculture policies, international trade agreements, bank credits, and programs which provide technical assistance and field trainings. Small farmer organizations, on the other hand, are at a complete market disadvantage in almost every respect. They have never been able to compete in the same market because the playing field has never been level.
2) With their new initiative, Fair Trade for All, TransFair/Fair Trade USA has proclaimed that plantations and small farmer co-operatives can co-exist happily, peacefully, and productively in the same system. What’s all the fuss about? It sounds nice, and if it were so, there would absolutely be no protest. The tragedy is that it has taken 25 years of blood, sweat, risk-taking, mistakes, and losses to build a healthy supply chain for small farmer co-ops. Finally we can say that small farmers have a voice and a seat at the table, have some degree of economic and political power none of which came magically or overnight. But, our work is not finished; there is still so much more to be done. Give a plantation owner additional benefits, beyond those already afforded, and you will wipe out the advances small farmers (and other Fair Traders) have worked so hard to achieve.
Finally, a philosophical question: If Fair Trade was created to balance an unfair playing field for small farmer organizations, and Fair Traders (producers, traders, and activists) who built the system and named it Fair Trade have always been strongly against plantations in coffee and cacao, what do you think about an organization that steals the name Fair Trade, walks away from the international Fair Trade system, and creates a new certification system in which coffee and cacao plantations will sit side by side with small farmer organizations? Is that not theft?
In the coming months we will ask our producer partners to weigh in on these questions. Today we start with Santiago Paz, Co-Manager of Cepicafe (the Piuran Coffee Growers Association) in Piura, Peru. We asked him why he believed that plantations should not be included in the Fair Trade system and what he thought the impact would be on small farmer co-operatives now that TransFair/Fair Trade USA has allowed plantations into their certification scheme. Here’s what he has to say:
“Since the 1990s, Fair Trade has supported the reactivation of co-operatives and small producer organizations. Fair Trade gives us an advantage. It allows us to become more competitive: coffee sales have grown; our product supply has diversified; we have broadened the market; and our sources of financing have increased.
Fair Trade has been made up of small, organized producers. The first phase of Fair Trade was marked by solidarity and the social commitment of the consumers: “These are small, organized producers that should be supported.” Quality defined the second phase: the organizations became more professional and their supply was characterized by superior quality. Fair Trade was economically viable, socially responsible and environmentally sustainable.
There are many examples in Peru: Cepicafe, Cocla, La Florida, Ceovasa, etc., all of which became political actors that continue to play an important role in the economy. Fair Trade has allowed us to become visible and it has given us the ability to influence political decisions at different levels of political power, guiding the role of international co-operation.
Fair Trade is about balancing unequal competition. The decision of Fair Trade USA to include plantations in the system is a serious threat to small farmer organizations. The small producers cannot compete with the plantations and large companies that have taken control of the market and of the decisions being made by Fair Trade USA.
Fair Trade, in Fair Trade USA’s scheme, doesn’t mean anything. In order to increase the market share there are large and small players in the system; organized producers and those who are not organized; good products and bad products.
What is the message that we are going to send to consumers? How are they going to identify us? In wanting to make everything Fair Trade, we are left with no message. Fair Trade means nothing.
… What is clear and seems to be difficult to understand in the North is that a producer organization can never compete with a large plantation. A co-operative is much more than a company that buys and sells coffee; it is a mechanism for development, practicing a solidarity economy by which the producers also hope to resolve their problems, such as a lack of highways and the need for healthcare centers and schools.
From my point of view, Fair Trade cannot stop generating development, this must be emphasized. This was Fair Trade’s originating ideal and it should not be abandoned. Fair Trade is help for self-help: it helps to strengthen your organization so that you can use this to resolve your problems.
Fair Trade USA has taken the wrong path—rather than continuing to fight so that Fair Trade can be more alternative trade, it is moving very close to traditional trade; it is playing by the same market rules which it aimed to change and is endorsing these same practices.
In our opinion, Fair Trade USA is leading us to the destruction of Fair Trade. In the short term, we are experiencing the consolidation of Fair Trade to that which is big. On one side the big importers and on the other side, big producers and exporters. This won’t last for very long and in the end the consumer will discover that s/he is supporting something that is different than what is being promoted.”
So, what do you think? Are we going to allow TransFair/Fair Trade USA to make away with all we have collectively built and set small farmers back 25 years?
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Cartoon courtesy of John Klossner. Copywrite 2012.