Choosing Fair-trade gives small-scale farmers the power to improve their livelihoods. Fair-trade labelling is based on a set of international standards guaranteeing producers in developing countries a fair and stable price, regardless of global market fluctuations.
The benefits of international trade are not shared fairly by everyone in the world. Small producers have limited access to market and price information. As a result, they are often dependent on middlemen and receive smaller returns for their work. Many plantation and factory workers endure low pay, unsafe working environments and poor living conditions.
The Fair-trade approach offers an alternative way to the injustices of conventional trade which traditionally exploits the poorest, weakest producers and misuses natural resources. Fair Trade provides a fair price for goods and services, safe working conditions and a commitment to environmentally sustainable production. Not only about buying and selling, fair trade practice supports welfare programs, education, healthcare and training for marginalized workers. This holistic approach makes fair-trade unique and empowers disadvantaged communities to play an active part in their own development.
What Fair-trade ensures is that producers receive a fair price no lower than the market price. It also ensures that there is accountability and transparency in the supply chain so you can be sure your product has been sourced ethically.
More information about fair-trade labelling
“The world price for cotton has been in steady decline for the past couple of decades. In the 2001-02 season cotton prices fell to US$0.92 per kilo – the lowest level in 30 years. While the current price has recovered somewhat the value of cotton is still only a third of what it was in the early 1980s.
The declining value of cotton is a result of the growing use of synthetic fibres like polyester and nylon. Cotton has fallen from 88% of total fibre use in the 1940s to just 40% today. The highly subsidized cotton industry in the United States, the European Union (EU), China, and other producing countries adds further pressure to prices. Cotton producers in the United States receive approximately US$4.2 billion in government subsidies. This is equivalent to the value of their entire crop. About three quarters of the US cotton crop is thus ‘dumped’ on the world market, often priced below the costs of production.
Cotton production in developing countries is less resource intensive and costs less. For example, it costs only US$ 30 cents to produce a pound of cotton in Benin versus US$ 68 cents in the United States. Nevertheless, it is the cotton farmers in the South who suffer the most from the low global cotton prices, since they rarely receive subsidies.
Since the introduction of the first Fairtrade Minimum Prices for cotton in 2004, Fairtrade has demonstrated it can substantially improve the lives of cotton producing communities. By selling to the Fairtrade market, cotton farmers have the security that they will receive a Minimum Price which aims to cover their average costs of sustainable production. They also receive a Fairtrade Premium which allows them to invest in community projects, such as schools, roads or health care facilities.”
Fairtrade Australia New Zealand
- See ‘On the Trail of Fairtrade Cotton‘ video. A journey to the heart of Senegal where cotton is the main cash crop for the locals and a vital source of income. Listen to cotton farmers talk about the concrete benefits Fairtrade has brought to their communities. But also about the challenges they are facing.
- See case-studies of Fairtrade cotton producers
- Meet Fairtrade Cotton Farmers at Agrocel Cotton Growers’ Association, India
- More on Fairtrade cotton