7 ways Fairtrade supports farmers amid the global inflation crisis

As Member States gather at the United Nations in New York to discuss the world’s most pressing challenges, Fairtrade International’s Senior Advisor for Global Resources Mobilization reflects on Fairtrade’s response to the economic crisis facing farmers around the world.

Across the world, farmers have faced increasing challenges over the past few years. COVID-19 market contractions, transport challenges, supply shortages, and the conflict in Ukraine have directly and indirectly impacted producers' sales, raised their costs of living, and spiked the prices for fuel and fertilizer. Amid it all, climate change has continued to deliver more frequent extreme weather events with devastating impacts on harvests and productivity. On all fronts, small-scale farmers are struggling.

Fairtrade producers are not immune to these challenges, but we are empowering them to tackle these shocks and stresses, and to build their resilience to future risks.

Here are seven ways Fairtrade works with farmers on the frontline of the global economic crisis:

Fairtrade Standards promote good agricultural practices to reduce water usage and carbon footprints, and to protect biodiversity. Sustainable agroforestry and switching to organic production not only helps to improve the quality of Fairtrade products, but boosts farmers’ food security and promotes climate adaptation and mitigation. In banana value chains, for example, Fairtrade’s Productivity Improvement Programme across Latin America and the Caribbean has led to a 23 percent increase in production, a 20 percent reduction in synthetic fertiliser use and a 12 percent reduction in water footprint. All of these actions reduce costs, protect against income loss, and build economic resilience to stressors such as inflation. Find out more about Fairtrade’s work in this area here.

Creating additional income - beyond relying solely on export commodity trade - is a key component of Fairtrade’s Living Income strategy. In response to the COVID-19 pandemic, Fairtrade has, for example, supported producers in Africa to diversify into bee-keeping, poultry farming, soap making and many other practical local start-up enterprises. Learn more here.

3. Fairtrade supports farmers and cooperatives in adding value to products.

Fairtrade works with producers to capitalise on local markets and “south-to-south” trade by adding value to crops. Cocoa producers in the Dominican Republic have opened a new processing plant for semi-finished cocoa products, and are innovating with cocoa as a raw ingredient for Dominican ice cream parlours, cosmetic companies and local chocolates for the tourism sector. In Vietnam, Fairtrade certified coffee growers have set up an e-commerce platform to tap into the growing local Vietnamese market for coffee aficionados.

Fairtrade is currently revising its Climate Standard to tap into growing opportunities for producers to be drivers of climate mitigation and adaption through Fairtrade carbon credits. To date, more than 650,000 tonnes of carbon emission equivalents have been offset by Fairtrade producers in countries including India, Peru, Lesotho and Ethiopia. Sales of the carbon credits fund the offset projects, while additional Fairtrade Premium paid for each credit goes to the producer organization to invest as they choose in other climate adaptation efforts or other investments beneficial to their cooperative.

Fairtrade continues to work with businesses committed to sustainability who are taking significant action to help achieve the UN Sustainable Development Goals (SDGs). This includes companies that have pledged to break the banana price war, and those committed to producers earning a living income. With growing consumer demand for sustainable products, businesses working with Fairtrade as well as sourcing from Fairtrade certified producers, are demonstrating leadership and proving that sustainability can be a win-win for all.

Fairtrade welcomes recent legislative measures being introduced by the EU, Germany, UK, Canada, Australia and many other countries on human rights and environmental due diligence. But there’s still a long way to go, and we call on governments and trade blocs to ensure a fair balance of the roles and responsibilities of all stakeholders in the value chain. In particular, we call for farmers and workers to be put at the centre of due diligence legislation -- which includes a call for enabling producers to earn living incomes – so no one is left behind.

7. Fairtrade generates market demand for sustainable products so that consumers can continue to support fairer futures for all.

It is estimated that in 2019 consumers across the globe bought over €9.8 billion worth of Fairtrade certified products, benefiting more than 1.9 million farmers and workers. But faced with the current global economic crisis, these same farmers and workers are also experiencing escalating production, transport, energy and warehousing costs. At the same time, inflation means many shoppers are tightening their belts. We strongly urge consumers to maintain their commitment to sustainability and to help end the ‘race to the bottom’ caused by the current cost of living crisis. Fairtrade producers need you now more than ever - just paying a few cents more may make a world of difference for farmers and workers and their families. You have the power to make the future fair.