Fair trade: a green, social and trendy concept« So bio, so ethic, so chic » is the current trend, and even in the chocolate industry. Now, people want their chocolate to be ethical and green, which is linked to another trendy concept: fair trade.
But, what is fair trade? It is, according to the WFTO, “a trading partnership, based on dialogue, transparency and respect, that seeks greater equity in international trade. It contributes to sustainable development by offering better trading conditions to, and securing the rights of, marginalized producers and workers – especially in the South”.
This concept is really trendy and appreciated by European and American consumers, who are willing to pay more for a certified chocolate.
Even some giants of the chocolate industry, such as Mars or Barry Callebaut, are going through a process of transformation toward sustainable cocoa. Mars’ aim is to reach 100% of certified cocoa in 2020, against 20% nowadays. Such actions could have a strong impact on the leaders of the chocolate’s industry.
The impact of fair-trade
Fair-trade responds to many issues and I am sure you know many of them, so I will be brief. The first issue is social. Since the 1950s, the price of cocoa has decreased a lot, which highly reduced the producers’ salaries. Lots of them had to drop their lands to find another source of revenues in town, and new generations of producers barely see themselves working in the sector. Small cocoa producers do not have lots of resources and possibilities to face the big cocoa corporations and, can hardly defend their interests. In addition to this price decrease, there is also a high fluctuation of the cocoa’s price: it can suffer from a 30% decrease from one day to another. You can easily imagine the bad consequences of this volatility on the producers’ activities and salaries.
Fair-trade responds to those issues, by supporting small producers and offering them stability and fix revenues. It allows to revive the local economy and development of a region or country. For example, in Ivory Coast, cocoa is called the “brown gold”. The country produces 40% of the market at a worldwide scale. This strategical product represents 10% of the Ivorian GDP and brings money to about 5 million of person. The revenues from fair-trade help to build and buy health centers, schools, water pumps and solar panels for example.
The second issue we can mention is environmental. The cocoa’s culture clearly destroys the forest. After 20 years of culture, the soils are no more exploitable, and producers have to find new lands. But the soils of the forest are fertile and then exploitable to cultivate cocoa. So, in Ivory Coast for example, around 14 million of hectares have been cut to plant new cocoa trees. For sure, it impacts the local fauna and flora and leads to the extinction of many species.
The hidden face of fair-tradThe main point that I wanted to cover is the hidden face of fair-trade. It is obvious fair-trade helped and still helps lots of producers to have a decent way of life and local economies to grow. But, it also raised some issues. You must all know the fair-trade leader brands Max Havelaar and Alter Eco. In the last years, several scandals were revealed by medias, especially about Max Havelaar. Their product traceability is quite hard to follow, and it questioned their whole fair-trade processes. Some of those scandals revealed several brands exploit child while the forbid of child’s labor is one of the strongest fair-trade principles.
Another issue is linked to the new label launched by Max Havelaar in 2014. The FSP label was created to convince more and more producers to join fair-trade. Now, Max Havelaar can certify a product as fair, even if it only contains a single ingredient from fair-trade, compared to before, when all ingredients had to be from fair-trade to be certified. It means that a Mars chocolate bare can be certified as fair even if only a very small percentage of its cocoa is actually from fair-trade and other ingredients are from traditional channels. We can wonder about the real signification and sense of a logo showing the product is certified. It must be a good marketing strategy for a brand, but it does not seem relevant for the consumer, who can hardly follow the traceability of the product he is interested in.
Max Havelaar also created what we call the “mass-balance”. It means that, a chocolate maker buying 30% of sustainable cocoa is allowed to certify 30% of its chocolate production. No matter if the final product really contains sustainable cocoa, in any cases the Max Havelaar label will be on the product. Certified cocoa and non-certified cocoa are being mixed during the production process. It avoids having two distinct production channels, which is cheaper.
According to a survey made by BVA for Max Havelaar in April 2015, 50% of the French population think fair products are too expensive, and 41% doubt about the real impact of fair-trade on small producers. According to that study, in France people spend only 6,24€ per year on certified products, against 41€ per person in Switzerland.
For example, for a chocolate bar costing 2,60€, only 16% of the price go to the producers (around 40 centimes), and 4% are for the organizations of producers in charge of the transformation and packaging of the product.
Finally, is fair-trade that fair?
Cited sources: - Petit, Pauline. " Mangez du chocolat sans l'amertume du travail des enfants" Consoglobe, 30 October 2018 https://www.consoglobe.com/chocolat-travail-des-enfants-cg
- Gouin, Simon. "Le chocolat équitable, un produit en voie de disparition ?" Bastamag, 17 April 2014 https://www.bastamag.net/Le-chocolat-equitable-un-produit
- Weiler, Nolwenn. "La face cachée du chocolat : travail des enfants et déforestation" Bastamag, 10 June 2016