What Is Fair Trade Worth?

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Fair Trade is meant to be a model of sustainable ethical trade that puts people and planet first. It is a conscious-consumption alternative to the neoliberal ideal of free trade that puts corporate profits above all else.

Under current regulatory systems, third-party verified certifications are a consumers’ best tool for identifying ethically produced products. But some indicators point to Fair Trade certification as ineffectual at best and a marketing ploy at worst. Is fair trade worth the extra cost?

What Is Fair Trade?


Fair trade as Americans know it today started in the 1990s. Paul Rice worked with Nicaraguan coffee farmers to develop cooperatives. When he returned to the U.S., he founded the organization TransFair, now known as Fair Trade USA, encouraging large companies that sold commodity goods like cocoa, bananas, and tea to get certified.

The fair trade certification process is lengthy and complicated. It requires annual inspections by an unbiased third-party auditor evaluating the company’s operations against standards for workers’ rights, fair labor practices, and responsible land management.

The Shadow of Doubt

From the very beginning, the fair trade movement was plagued by accusations. Some said fair trade was just another form of greenwashing. Other complained that the high cost of certification made it inaccessible to the smallest producers who needed it most.

In 2014, a controversial study in Africa by the University of London was unable to find any evidence that fair trade has made a positive difference to the wages and working conditions of those employed in the production of the commodities produced for Fairtrade-certified export. A more recent study in Costa Rica found that fair trade did have benefits, but that the benefits did not reach all workers in the industry.

Better Than Nothing


Consumer confidence is strongest when a single certification system dominates an industry. But today there are numerous fair trade organizations. They certify different classes of products around the world, and they each have their own set of standards. This makes it harder for consumers to know how much weight to give a label.

Both of the studies referenced above examined Fairtrade International (their U.S. branch is called Fairtrade America) rather than Fair Trade USA.

But The Fair World Project, a nonprofit that evaluates certification and membership systems, recommends Fairtrade as one of several strong third-party certified fair trade labels that benefit farmers in the global South. They recommend approaching others with caution — including the well-known Fair Trade USA and Rainforest Alliance labels. Their issues with these systems relate to low standards or loopholes, rather than intentional “fair-washing.”

Is It Enough?

Fair Trade labels do not accomplish everything we would want from them or even everything that they promise. They are a guide but one that must be checked by the buyer. It is worth spending some time to familiarize yourself with different systems and their standards to see how they align with your values and priorities. Any certification at all is better than none. It reflects a genuine effort at improvement on the part of the producers. But we each have to decide for ourselves whether a specific label is worth the higher price.

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Gemma Alexander

Gemma Alexander has an M.S. in urban horticulture and a backyard filled with native plants. After working in a genetics laboratory and at a landfill, she now writes about the environment, the arts and family. See more of her writing here.

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