In 1998, Bomart Farms began exporting about one ton of fresh fruit per week – pineapples and mangoes – to Europe. This holiday season it will export close to 500 tons per week. But just 15% of that quantity is certified Fairtrade – about half what it was a year ago, the company’s managing director said.

“Fairtrade sales are going down because of the economic crisis in Europe,” explained Anthony Botchway, the company’s managing director. “When consumers feel the pinch, it is harder for them to spend more on products that cost more, like Fairtrade.”

Therein lies the enigma of Fairtrade: What happens when consumers do not respond?

The approach is straightforward enough: By certifying that a company pays its workers a fair wage, and produces a good in environmentally, socially and economically sustainable ways, the company can market its products with a Fairtrade label – targeting the consumer who understands and responds to those issues. The Fairtrade logo is broadly recognized in many international markets, particularly the United Kingdom, where it has 75% recognition, the organization said.

 “There are two conflicts,” Botchway said. “There is a market price determined by the forces of supply and demand – and a Fairtrade price that is higher. These are things we need to look at.”

Botchway was speaking as he welcomed visitors to his exhibition booth at the Africa Fairtrade Convention in Accra, Ghana. The convention brought hundreds of Fairtrade stakeholders together from across the continent – from certified companies to trade policy experts, producers’ cooperatives to major multinational companies committed to sourcing Fairtrade produce.

In a panel discussion on equal trading partnerships, Fairtrade Executive Director Rob Cameron acknowledged that consumer demand for Fairtrade goods is an important issue, but disputed market research that shows demand falling off dramatically as prices rise.

“The surveys ask people what they would do but that is not always true of what they do do,” Cameron said.

Indeed, overall, demand for Fairtrade products is increasing – at least in the United Kingdom, said Aurelie Walker, a trade policy expert with Fairtrade International.

“The market in the U.K. has grown and is growing,” Walker said. “It is important to grow the market.”

Fairtrade products make up about one percent of international trade. Increasing that share is not only about prices, however. While important, market forces affecting sales of Fairtrade products were hardly the only issue on the agenda. The certification program, born of social and environmental concerns that have gradually become major preoccupations for millions of consumers worldwide, involves efforts on both the supply and demand sides of the value chain.

“Farmers need security of livelihoods,” said Alistair Child, Cocoa Sustainability Director at Mars Chocolate, which churns out three million chocolate bars a day. “Industry needs security of supply.”

Child was one of six panelists discussing “Equal Trading Partnerships,” moderated by USAID Trade Hub Director Vanessa Adams.

“The principle underlying our approach is that shared benefit will endure,” Child said. “We won’t have an enduring benefit if we don’t find a way to make sure farmers benefit.”
Improvements in quality and quantity at the farm level were critical to achieving benefits to both farmers and industry, he said.

“In cocoa, we have the 70-30 rule – 70 percent of the cocoa comes from 30 percent of the trees,” he said. Transferring new techniques to improve yields and manage cocoa trees would address the issue.

Companies are more interested in Fairtrade today than in the past because they see it as a means to achieve the supply-side improvements critical to industry sustainability, Walker said.

Developing shared benefit, then, is the key challenge, Walker said in a presentation at the convention. The fundamental issue, she said, is that equal trading partnerships are not the norm.

“Trade is unfair,” Walker said. “Most trading partnerships are unequal. When there is equality, Fairtrade won’t be needed. Fairtrade needs to go further to achieve equal trading partnerships.”

She challenged stakeholders to develop fuller trading partnerships that facilitate producers’ participation in other aspects of trade.

“For instance, can producers influence prices?” she asked convention participants. “To what extent do they control their intellectual property? … Would deeper interaction by farmers in the supply chain help them develop better?”

In the meantime, exporters like Botchway are building their businesses - and hoping consumers get on board with the scheme.