Featured Research

from universities, journals, and other organizations

Fair Trade Labels No Solution For Poor Farmers

Date:
November 11, 2009
Source:
Vetenskapsrådet (The Swedish Research Council)
Summary:
Fair Trade labeling can work on a small scale, as a niche market. On the other hand, Fair Trade labels are not the right way to change the situation for the great majority of poor farmers. This is shown in the report What Does Fair Trade Labeling Achieve? from AgriFood Economics Centre, Lund University and the Swedish University of Agricultural Sciences (SLU).

Fair Trade labeling can work on a small scale, as a niche market. On the other hand, Fair Trade labels are not the right way to change the situation for the great majority of poor farmers. This is shown in the report What Does Fair Trade Labeling Achieve? from AgriFood Economics Centre, Lund University and the Swedish University of Agricultural Sciences (SLU).

Fair Trade labeling is based on farmers receiving a guaranteed minimum price for their production. The problem is that there are no resources to finance, on a large scale, a minimum price that is higher than the world market price -- the number of poor farmers is simply too great in relation to the number of well-heeled consumers who can and want to pay more for the food products.

There are 880 million poor farmers in the rural parts of developing countries, and 1.5 million of them are associated with Fair Trade. This means that this labeling has no chance of truly combating poverty and improving the living conditions of the great majority of farmers in developing countries.

" Instead, higher incomes in rural areas can be achieved by improving the productivity of farming. This requires domestic measures. Look at India and Chine, who have carried out reforms in agriculture. Both countries have increased their productivity, in China through greater market orientation and in India by using seeds that yield better harvests. This has helped reduce poverty in rural areas markedly."

This is not to say that Fair Trade labeling is useless, but rather that it must be kept in perspective, according to Helena Johansson.

"On a small scale, labeling can benefit the farmers involved. The advantages are that they are not as vulnerable to falling prices on the world market as others, that they receive a social premium that can be used for investments for the common good, and that the standards can lead to better working conditions. The transfer of money from consumer to producer is inefficient, however. The extra money we pay in the store for Fair Trade items goes partly to the grocery store, the purchaser, the wholesaler, and the coffee roasting company, for instance. The entire chain costs money, which means that only a small portion goes to the farmer."


Story Source:

The above story is based on materials provided by Vetenskapsrådet (The Swedish Research Council). Note: Materials may be edited for content and length.


Cite This Page:

Vetenskapsrådet (The Swedish Research Council). "Fair Trade Labels No Solution For Poor Farmers." ScienceDaily. ScienceDaily, 11 November 2009. <www.sciencedaily.com/releases/2009/11/091111121547.htm>.
Vetenskapsrådet (The Swedish Research Council). (2009, November 11). Fair Trade Labels No Solution For Poor Farmers. ScienceDaily. Retrieved August 27, 2014 from www.sciencedaily.com/releases/2009/11/091111121547.htm
Vetenskapsrådet (The Swedish Research Council). "Fair Trade Labels No Solution For Poor Farmers." ScienceDaily. www.sciencedaily.com/releases/2009/11/091111121547.htm (accessed August 27, 2014).

Share This




More Plants & Animals News

Wednesday, August 27, 2014

Featured Research

from universities, journals, and other organizations


Featured Videos

from AP, Reuters, AFP, and other news services

Raw: Firefighters Rescue Puppy Stuck in Tire

Raw: Firefighters Rescue Puppy Stuck in Tire

AP (Aug. 26, 2014) — It took Houston firefighters more than an hour to free a puppy who got its head stuck in a tire. (Aug. 26) Video provided by AP
Powered by NewsLook.com
Have You Ever Been 'Sleep Drunk?' 1 in 7 Has

Have You Ever Been 'Sleep Drunk?' 1 in 7 Has

Newsy (Aug. 26, 2014) — A study published in the journal "Neurology" interviewed more than 19,000 people and found 15 percent suffer from being "sleep drunk." Video provided by Newsy
Powered by NewsLook.com
Great White Shark Spotted Off Massachusetts Coast

Great White Shark Spotted Off Massachusetts Coast

Reuters - US Online Video (Aug. 26, 2014) — A great white shark is spotted off the shore at Duxbury beach in Massachusetts forcing beach goers out of the water. Linda So reports. Video provided by Reuters
Powered by NewsLook.com
Raw: Elk Wanders Into German Office Building

Raw: Elk Wanders Into German Office Building

AP (Aug. 25, 2014) — A young bull elk wandered inside the office building of a company in Dresden, Germany on Monday. The elk became trapped between a wall and glass windows while rescue workers tried to rescue him safely. (Aug. 25) Video provided by AP
Powered by NewsLook.com

Search ScienceDaily

Number of stories in archives: 140,361

Find with keyword(s):
 
Enter a keyword or phrase to search ScienceDaily for related topics and research stories.

Save/Print:
Share:  

Breaking News:
from the past week

In Other News

... from NewsDaily.com

Science News

Health News

    Environment News

    Technology News



    Save/Print:
    Share:  

    Free Subscriptions


    Get the latest science news with ScienceDaily's free email newsletters, updated daily and weekly. Or view hourly updated newsfeeds in your RSS reader:

    Get Social & Mobile


    Keep up to date with the latest news from ScienceDaily via social networks and mobile apps:

    Have Feedback?


    Tell us what you think of ScienceDaily -- we welcome both positive and negative comments. Have any problems using the site? Questions?
    Mobile iPhone Android Web
    Follow Facebook Twitter Google+
    Subscribe RSS Feeds Email Newsletters
    Latest Headlines Health & Medicine Mind & Brain Space & Time Matter & Energy Computers & Math Plants & Animals Earth & Climate Fossils & Ruins