Shoppers are being urged to keep on buying Fairtrade products amid fears of a “race to the bottom” as struggling Britons look for ways to save money during the cost of living crisis.
Anna Barker, head of responsible business at the Fairtrade Foundation, said the organisation had not seen a shift in spending away from the ethical brand but was worried about how people would react to the worsening squeeze on their finances.
UK inflation hit 9% in April, its highest level for 40 years. It is feared consumers will be less concerned about sustainability and will instead focus on searching for the cheapest products.
“Farmers are going through a cost of living crisis, too,” said Barker.
“If there was a race to the bottom during a time like this it will have long-term consequences for the way that we consume. You are going to see farmers consider whether they’re in the right industry if they’re not able to sell their products at a price that covers the cost of production.”
The Fairtrade label guarantees that the producers get a set minimum price, as well as a financial bonus, and its famous logo is now stamped on more than 6,000 products, including chocolate, coffee and bananas.
Willy Paredes, a producer representative from Fairtrade’s Latin American and Caribbean network who works with banana growers, says they are suffering “two hits”. “One is on the cost of living and the other is on the cost of production.”
Paredes, who is based in Peru, says that – like UK farmers – growers are struggling to manage a dramatic jump in the cost of key products such as agricultural chemicals. “Bananas are harvested 52 weeks of the year so the farmers have felt it a lot more because they need to buy these inputs permanently during the year.”
In recent years British shoppers have opted to spend more on ethical products, with demand for plant-based foods as well as Fairtrade and organic ranges increasing on the back of lifestyle changes linked to Covid and the climate crisis. At last count, UK Fairtrade sales had reached £1.9bn in 2020, according to the Co-op’s ethical consumerism report, an increase of 14%.
“Most products have been undervalued for a very long time and that’s been a huge challenge for sustainability,” said Barker. “To move the dial on sustainability the true value of products needs to be represented. That conversation is really happening now. People are beginning to understand that supply chains are vulnerable.”
Barker said Fairtrade was everywhere on the high street, including in budget chains such as Lidl and Greggs. “Going to Greggs for your coffee isn’t a more expensive choice … but there is still a need for you to choose Fairtrade.”
Fairtrade producers on how costs are affecting them
In crisis-hit Sri Lanka, Seevali Mudannayake, group manager at the Strathspey tea estate, which belongs to the tea producer Maskeliya Plantations, says living costs are “going up every day”. “It’s skyrocketing, there is no limit to it.” People are waiting all day in long queues to buy fuel, he says, a situation that is “forcing them to lose their daily incomes”.
Tomy Mathew, a cashew farmer in Kerala, India, says rice now costs him 20% more, while the price of vegetables is up 12%. “But coughing up that additional sum will not put food on the table,” he said. “Cooking gas is now 27% more expensive and commuting to market 15% more.”
Hugo Guerrero, a coffee farmer in Piura, Peru, said: “Many prices have increased due to the rise in fuel costs … fish, oils, rice and flour. It is also very difficult on the farm because the cost of living increases every day and it is necessary to pay a little more to the people who work with us.”
