Fair Trade from the Ground Up
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Fair Trade from the Ground Up

New Markets for Social Justice

April Linton

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eBook - ePub

Fair Trade from the Ground Up

New Markets for Social Justice

April Linton

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About This Book

Fair Trade promises to raise living standards in developing countries through:

- worldwide minimum prices for commodities

- support for democratically governed cooperatives

- requirement of minimum wages and safety standards for workers

- training to help producers improved quality and develop business skills

- encouragement of eco-friendly practices

- third-party certification

In contrast to the free trade status quo, Fair Trade relies on informed consumers to choose more direct supply chains that minimize the role of middlemen, offering economic justice and social change as a viable and sustainable alternative to charity. But does it work?

Fair Trade from the Ground Up documents achievements at both the producer and the consumer ends of commodity chains and assesses prospects for future growth. From Guatemalan coffee farmers to student activists on U.S. college campuses, the stories of individuals inform April Linton's analysis. Drawing on studies by social scientists and economists, as well as on new case studies, she provides balanced answers to hard questions: How can large institutions be persuaded to commit to using Fair Trade suppliers? Does ethical consumerism work? Are the "social premiums" that are built into Fair Trade prices really being used for community projects? Will Fair Trade market growth reach the scale of organics or green products? This book meets a long-felt need among economic-justice activists, consumer groups, and academics for a reliable qualitative and quantitative overview of achievements of the Fair Trade movement.

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Chapter 1

Fair Trade from the Ground Up

There are over eight hundred Fair Trade certified producer organizations on four continents: Africa, Asia, North America, and South America.1 Nearly half of them grow coffee; others produce tea, cocoa, grains, sugar, spices, fruit, honey, wine, olive oil, and flowers. Why and how have these producers organized? How do they perceive their participation in Fair Trade? What benefits and drawbacks have they experienced? How are they differentiating their products in the market? A body of field research by sociologists, anthropologists, geographers, and others allows us to address these questions. The studies that inform this chapter are listed in table 1.1.
Some producers were organized prior to their involvement in Fair Trade. In El Salvador, Mexico, and Nicaragua, coffee-growing cooperatives date back to 1980s land reforms. In their study of the Mexican cooperative union Coordinadora Estatal Productores Café Organico (CEPCO), researchers Josefina Aranda and Carmen Morales (2002) note that it was easy to achieve Fair Trade certification because the group and its member cooperatives were already organized and democratic. Similarly, in Tanzania the socialist government (in power from 1967 to the 1980s) assigned all coffee growers to rural cooperative societies that in turn aggregated into cooperative unions; some coffee unions there have even deeper roots. In post-apartheid South Africa, the policy of Black Economic Empowerment (BEE) has provided incentives to establish black-owned businesses as well as enterprises in which the workers are shareholders. These include vineyards, wineries, tea cooperatives, and fruit farms. Start-up funding for one Fair Trade winery came from the country's Department of Land Affairs and from a trust established to allocate public and government donations received after a disastrous bridge accident in 1987.
The first producer group in the world to gain Fair Trade certification basically invented a label that stated what they were already doing. The UniĂłn de Comunidades IndĂ­genas de la RegiĂłn del Istmo (UCIRI) in Oaxaca was organized with the help of farmer/priest Franz (Francisco) VanderHoff Boersma, who then worked with a Dutch development organization to create a certification process and establish Max Havelaar, the first Fair Trade certifier (Audebrand and Pauchant 2009, VanderHoff Boersma 2009). Other Fair Trade producer groups formed with the aid of religious organizations. In Bolivia, the Central Cooperativas Agropecuarias “Operacion Tierra” (CECAOT) union of quinoa growers came together to mechanize their production at the urging of Belgian missionaries (CĂĄceres, Carimentran, and Wilkinson 2007). The Oaxaca, Mexico, cooperative Yeni NavĂĄn/Michiza and the Guatemalan highlands cooperative La Voz have histories that link Christianity, social justice, and a desire for autonomy (Jaffee 2007, Lyon 2002). Describing the origins of the La Selva coffee cooperative in Chiapas, Mexico, researcher Alma Amalia GonzĂĄlez Cabañas writes,
Many of the communities where founding members live supported the work of consciousness-raising in the Catholic Church. The feeling of fraternity shared in the community reflection groups focusing on the “word of God” served as the basis for formation of relationships of trust (confianza) among the producers. The priests emphasized to the producers the importance of not relying on middle men (coyotes) to commercialize their products. They also promoted community projects in health care, basic supplies stores, literacy and, of course, the formation of catechists. (2002, 3)
Still other groups of farmers organized specifically because they wanted Fair Trade certification. This is true of the coffee unions CoocafĂ© in Costa Rica, Oromia in Ethiopia, and CEPICAFE in Peru (Ronchi 2002, Satgar and Williams 2008, Walsh 2004). Once established, many groups receive start-up or goal-specific aid from nongovernmental organizations (NGOs). At least five different NGOs have supported “producer-led efforts to build effective cooperatives” in Nicaragua (Bacon et al. 2008, 261), and NGOs played an important role in financing CoocafĂ©'s hijos del campo rural education program and the group's production of the roasted and packed CafĂ© Paz brand (Ronchi 2002). South Africa's Heiveld and Wuppertal rooibos tea cooperatives achieved Fair Trade certification with the help of two NGOs (Raynolds and Ngcwangu 2010). Working with United States Agency for International Development (USAID) funds, the “business solutions” NGO TechoServe helped groups of Tanzanian farmers to improve their coffee's quality and form a new exporting entity, the Association of Kilimanjaro Specialty Coffee Growers (AKSCG). Subsequently, AKSCG's farmers applied for and received Fair Trade certification because they already met the criteria and wanted to expand their market reach (Linton 2008).
At least one Fair Trade producer group, Kuapa Kokoo in Ghana, exists in response to an International Monetary Fund/World Bank structural adjustment program. The Ghanaian government's denationalization of the cocoa trade made farmers more vulnerable but also allowed them to set up their own organizations. The UK-based Fair Trade organization Twin Trading provided start-up credit and financial advice to the initial woman-led group of 2000 cocoa farmers. “This was a farmer-rooted response to liberalization aimed at increasing farmer power and representation within the market as well as enhancing women's participation and encouraging environmentally sustainable production patterns” (Report on Kuapa Kokoo Farmers 2001, cited by Doherty and Tranchell 2005, 170).
Since the late 1970s, the Eastern Caribbean has been part of the Mabouya Valley Development Project (MVDP), which is aimed at developing the agricultural sector by way of individualized (rather than family) land tenure. In the early years of the MVDP, farmers could get low-interest loans to buy five-acre parcels from the government. They received subsidized irrigation and participated in local community organizations, with women in the forefront. By holding monthly meetings, MVDP promoted common interests and familiarity. The farmers organized into cooperatives because of the impending termination of tariff-free quotas in European markets.2 Facing competition from giant Latin American plantations, in 1999 the Windward Islands Farmers Association (WINFA) started working with Fairtrade Labelling Organization (FLO; now Fairtrade International) to establish Fair Trade producers on St. Vincent, Dominica, St. Lucia, and Grenada. Before then, formal cooperatives “either did not exist or were largely nonfunctioning,” so their proliferation can be attributed entirely to incentives provided by Fair Trade (Moberg 2005, 12). The first farmers to participate in Fair Trade were those who had previously participated in the MVDP. These farmers were more established and owned land, and the women had previous experience participating in mutual-aid groups (Moberg 2010).
These examples show very diverse motivations and circumstances for the acquisition of Fair Trade certification and for participation in Fair Trade value chains by various groups of farmers. Some cooperatives already existed as a result of land reform, faith- or NGO-based development initiatives, and response to structural adjustment or trade liberalization. These groups later applied for Fair Trade certification, whereas others organized specifically because they wanted the certification.
Field researchers usually spend a large amount of time living within Fair Trade producer communities and interviewing or surveying community members, so their field studies highlight a diversity of views and understandings on the part of organized farmers and their groups' leaders. Although it is impossible to definitively label Fair Trade producers' status within their groups, it is useful to differentiate between farmer-members, farmer-leaders, and union leaders. Farmer-members are, first and foremost, farmers. They do not claim leadership roles in their groups. Farmer-leaders organize, educate, direct, and in some cases act as the interface between their producer group and Fair Trade buyers. Union leaders work in offices; they are administrators of large groups of cooperatives that export produce together. The cooperatives in a union are not necessarily in the same geographic area. For example, Manos Campesinos in Guatemala is a union of eight cooperatives in four distinct regions of the country.
Participant observation indicates that the relationship between farmers and Fair Trade's goals is often ambiguous. For example, one study indicates that the farmer-members of a Mexican coffee cooperative saw poverty as part of their identity, believing that they needed to stay poor in order to benefit from Fair Trade (GonzĂĄlez Cabañas 2002). Others document Kenyan tea farmers' cluelessness about where their Fair Trade teas end up (Dolan 2008)3 and Darjeeling tea plantation workers' scant knowledge of their rights under the Fair Trade system (Besky 2010). Out of fifty-three members of a Guatemalan coffee cooperative surveyed between 2001 and 2006, only three were even familiar with the term comercio justo (“Fair Trade”; Lyon 2007, 257).
A study conducted in a Peruvian coffee cooperative found that, although the leaders of the cooperative were very clear about who was buying the coffee, the prices paid, and the expenditures, farmers “find it difficult to comprehend exactly why different buyers pay more for the same product and why prices are higher in some years than others
. What seemed to stick in the end is that [the cooperative] exports directly to a range of international buyers who pay different prices and value different things. The common denominator is that all of these foreign buyers demand high quality
. Instead of attributing favorable prices to Fair Trade, producers tend to associate them with membership in an organization that supplies high quality coffee directly to international markets” (Walsh 2004, 39–40, italics added). This is something Fair Trade cooperatives do; but note that these producers saw Fair Trade as just another market.
Another study of coffee growers, this time in Oaxaca, Mexico, reveals that farmers relate to Fair Trade on the basis of price, services provided, or organic production, but not necessarily in terms of solidarity, alternative markets, empowerment, or sustainability. “Members are far more likely to identify themselves as organic coffee producers than as fair-trade producers, because it is the tasks involved in organic coffee production that actually influence their farming practices and differentiate them most clearly from their neighbors” (Jaffee 2007, 91). The Fair Trade market has provided these farmers with crucial price stability, but they “hold widely different understandings of what fair trade is” (Jaffee 2007, 91). Some equate “Fair Trade” with “organic”; others mention better prices or greater demands on the producers. In summary, sociologist Daniel Jaffee writes, “fair trade constitutes a critical—yet largely invisible—factor that stabilizes the much higher prices they receive for their organic coffee” (2007, 92, italics added). The Fair Trade–organic producers he studied are doing better than their neighbor-farmers who are not in the cooperative, but they still have trouble making ends meet. Given the higher standards and extra work that cooperative membership entails, Jaffee asked farmers why they stick with it. This is the part of the story where the less-tangible benefits of Fair Trade come into play. “For many producers, the main reason for sticking to the organization may be something impossible to quantify: the sense of belonging to something larger than oneself
. Those who have stuck with Michiza for several years do so because it makes them actors in a collective process, one that has deeper meaning than any simple measure of loss and profit” (Jaffee 2007, 245). Michiza members take pride in their organic farming, even as they struggle financially. Speaking about why farmers stay in the cooperative, one longstanding member told Jaffe,
They get to know more people, they know that their coffee is being sold for a certain price, and they know where it ends up, and that nobody—at least not within the cooperative—is lining their pockets with the difference. They have more information, they have come to value many things that before they didn't value. They have discovered important things that the organization has offered them, such as how to use their local resources, and they enter into another kind of dynamic. And they say “Well, that's a profit too, right?” That's a profit. (245)
Research among producers in the nine Costa Rican cooperatives that comprise the CoocafĂ© coffee union indicates that they understand Fair Trade largely as a price-stabilization mechanism. They appreciate having a fixed schedule of deliveries to Fair Trade clients rather than one-off orders. Also, belonging to a larger organization (the union) has improved the leadership within the cooperatives, which has led to better service delivery to farmer-members and the surrounding communities. Producers are very aware of the superior price conditions and the improved services of their cooperative, “but with a low awareness of Fair Trade” (Ronchi 2002, 25). Because Fair Trade has successfully provided a better price and supported the CoocafĂ© union, it appears that farmers' lack of awareness of the source of their prosperity is a problem of communication that the cooperative leaders could address.
Interviewing banana growers in the Dominican Republic, sociologist Aimee Shreck found that all of the farmers correctly identified themselves as organic producers. More than three-quarters of them were also members of Fair Trade cooperatives, but only half of these recognized as much.
When asked more specifically about the Fair Trade initiative (such as about its benefits and how it worked), even these producers demonstrated only an elementary and partial understanding, at best. For example, when asked about Fair Trade, producers with some knowledge often mentioned that they knew there was something called “comercio justo” (Fair Trade), but were unable to explain more. One producer's response captured a sentiment I frequently heard. To paraphrase his explanation: “Max Havelaar (the name of the Fair Trade organization that originally worked with these farmers) is a guy from Europe and he likes us small farmers, and so he buys our bananas.’ Others more concisely reported that Fair Trade was “a market” but could not elaborate. Significantly, none of the producers in my sample mentioned or knew about the minimum prices guaranteed by FLO, nor of the long-term commitment Fair Trade partners are expected to make to producers. (2005, 22)
The Eastern Caribbean banana growers Mark Moberg studied seem most familiar with the parts of Fair Trade that they do not agree with, especially Fairtrade International's prohibition of herbicides. Although admitting that better prices and the Fair Trade social premium have offset the costs of compliance to this rule, “farmers see little difference between the new standards to which they are held by FLO and the previous dictates of [exporters] and European importers to which they continue to be subject, all of which they characterize as arbitrary, costly and authoritarian” (2010, 67).
At the other end of the spectrum are studies that point to Fair Trade producers who thoroughly understand Fair Trade value chains and see themselves as part of a global social-justice oriented community, or a “solidarity-seeking commodity culture” (Bryant and Goodman 2004, 360). For example, Kuapa Kokoo farmers in Ghana are part owners of Day Chocolate, the company that buys most of their produce (Doherty and Tranchell 2005). The farmers, who are organized within 1,300 village-based societies, are stakeholders who control what they produce and sell (Shuman, Barron, and Wasserman 2009). Members of the Chilean Los Robles wine cooperative have a very deep understanding of Fair Trade as a social marketing strategy that differentiates them from their competition (Kleine 2008). VanderHoff Boersma's (2002, 2009) writings about Unión de Comunidades Indígenas de la Región del Istmo (UCIRI) emphasize farmers' solidarity, connection to the land, and maintenance of indigenous cultural practices even more than their improved standard of living. In some Nicaraguan coffee unions, farmers linked Fair Trade with high-quality and organic production, and recognized a need for solidarity in order to meet these standards (Pirotte, Pleyers, and Poncelet 2006).
In the research discussed above, the most common way that farmers relate to Fair Trade is in terms of stable or better prices and access to markets. Next we find ideas about social justice, solidarity, and—in one case—social marketing. Two of the studies reveal that many members of Fair Trade cooperatives do not know what “Fair Trade” means. And, finally, the Kenyan tea farmers did not know where their tea was going, but they were aware of development projects funded by the Fair Trade social premium (Dolan 2008).
Farmer-Leaders and Union Leaders
Farmer-leaders are at the helm of cooperatives or large individual farms; union leaders manage groups of producer cooperatives. These people interact with Fairtrade International and international buyers; they certainly need to understand their jobs. Independent cooperatives, farms (e.g., tea estates and vineyards), and unions all sometimes find it necessary to hire leaders (or at least consultants) from outside their membership to deal with export transactions, recordkeeping, and sometimes marketing as well.4
Researchers VĂ­ctor PĂ©rezgrovas Garza a...

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Citation styles for Fair Trade from the Ground Up
APA 6 Citation
Linton, A. (2012). Fair Trade from the Ground Up ([edition unavailable]). University of Washington Press. Retrieved from https://www.perlego.com/book/723695/fair-trade-from-the-ground-up-new-markets-for-social-justice-pdf (Original work published 2012)
Chicago Citation
Linton, April. (2012) 2012. Fair Trade from the Ground Up. [Edition unavailable]. University of Washington Press. https://www.perlego.com/book/723695/fair-trade-from-the-ground-up-new-markets-for-social-justice-pdf.
Harvard Citation
Linton, A. (2012) Fair Trade from the Ground Up. [edition unavailable]. University of Washington Press. Available at: https://www.perlego.com/book/723695/fair-trade-from-the-ground-up-new-markets-for-social-justice-pdf (Accessed: 14 October 2022).
MLA 7 Citation
Linton, April. Fair Trade from the Ground Up. [edition unavailable]. University of Washington Press, 2012. Web. 14 Oct. 2022.