Farmers’ short end of the supply chain deal is not over
October marks Fairtrade month, a significant event this year amid the continuing cocoa crisis and its impact on farmers’ livelihoods.
“This is a milestone Fairtrade Month,” Amanda Archila, Executive Director, Fairtrade America confirms, summing up the certification system’s landscape in 2024.
Fairtrade is also celebrating 30 years of impact. Canadian sales of Fairtrade-certified products in the past decade have generated $64 million in Fairtrade Premium, an extra amount of money that goes into a communal fund that workers and farmers can spend. Farming organisations have invested this additional income into community and business projects that strive to drive sustainable development and positive change.
Yet, despite rising awareness around sustainability in the cocoa industry, farmers still face a lack of resources, worsened by the severe weather conditions and crop shortages.
Underinvestment stalls the cocoa sector
Industry and consumers may believe that growing awareness about the cocoa supply chain will equate to numerous shifts in the right direction occurring since the last Fairtrade Month in October 2023. However, this appears to be limited due to longstanding legacy problems that remain unresolved.
“The historic shortage and resulting high prices seen over the last year directly result from decades of underinvestment at the farm level,” says Archila.
“Cocoa farmers have operated on nearly non-existent profit margins for so long, often living in poverty themselves,” says Archila.
As a result, they do not have the resources to address the compounding issues of recent years, like ageing trees, crop disease, and hotter, drier weather patterns.
What gives Fairtrade hope is that farmers know what they need to do to produce more beans, including investing in practices like agroforestry and replacing ageing trees. “They just need the resources to do it,” Archila confirms.
While there may be the expectation that these issues may improve as we head into the new cocoa season, over 2024/2025, and beyond, it’s unlikely. “None of these issues have been solved, so we should anticipate continuing challenging years for cocoa farmers,” Archila says.
Farmers have fewer beans to sell, so they have less income and will be less able to reinvest in the next growing cycle. The message is clear: “Chocolate makers must consistently pay higher prices to farmers to turn this cycle around,” says Archila. The biggest manufacturers can afford to do that without passing these higher prices to shoppers. Yet, investment in addressing farm-level issues is the most direct solution.
Purchasing power gathers pace
As of 2024, due to the evolving sector and growing awareness surrounding the challenging conditions for farmers, consumers are more discerning when buying chocolate goods.
“What’s exciting is that shoppers have become more aware of their purchasing power and are using it to push big food companies in a more conscientious direction,” Archila shares.
Globally, 71% of shoppers recognise the Fairtrade Mark, and most say they trust it. Fairtrade also states that 70% of Canadians who know the Fairtrade Mark think it makes it easy to decide if a product is ethically produced. “That’s encouraging,” says Archila. In the US, consumer recognition of the Fairtrade Mark has increased by 118% since 2019, signalling the increasing awareness of sustainability and labels among shoppers.
These trends cue brands to reevaluate their sustainability initiatives and how they communicate to consumers about their environmental efforts. The more consumers, brands and retailers know about the lack of fairness and sustainability in traditional supply chains, Fairtrade says the more investment there is in certifications like Fairtrade. These then provide frameworks for doing business in a way that’s better for people and the planet.
“The silver lining is that the global spotlight on the challenges in producing and procuring cocoa is helping to raise awareness about the injustices faced by cocoa farmers,” says Archila. Efforts and actions focus on fostering robust, resilient communities that can navigate the current cocoa crisis and receive a fair wage.
Fairtrade certification seeks to protect farming communities from exploitative pricing. It provides an additional sum, known as the Fairtrade Premium, that enables communities to democratically choose how to invest. This investment can be in farm-level or community-level business solutions or provisions like schools, medical infrastructure and services, roads and transportation, and access to clean water.
For example, Fairtrade’s Sankofa Dynamic Agroforestry Project in Ghana has trained more than 4,000 farmers on sustainable farming methods. It emphasises the importance of income diversification, climate resilience and biodiversity conservation through a multi-stakeholder approach.
Dynamic agroforestry combines crops and tree species with different life cycles and occupies different forest levels (or strata). Farming households therefore have additional crops for annual consumption and income outside the cocoa season.
Thoughtful purchasing is a key theme
There’s a push towards thoughtful purchasing, with considerable motivation stemming from consumers’ concerns for our planet. “There’s no question that meaningful action to address climate change is urgently needed, but people are forgetting that you can’t reach environmental sustainability without addressing economic and social justice issues first,” says Archila.
The people behind our food must be able to fulfil their basic human needs before considering their impact on the environment around them. “It’s about choosing products that support
fairer prices, better working conditions, and sustainable practices both today and in the long run,” says Archila.
The guidance for brands, manufacturers and retailers is to consider whether their sustainability initiatives are built to last. They need to consider long-term practices or if they risk being cut when economic times get difficult. “Farmers deserve pricing that honours their hard work now and in the future,” Archila confirms.
Confectionery snack brand and Fairtrade-certified Hu Kitchen sources 100% of its cocoa, coconut sugar, cashews, vanilla, and quinoa on Fairtrade terms.
“Being certified Fairtrade means farming organisations are able to earn at least the Fairtrade Minimum price, which acts as a safeguard for when market prices drop,” a spokesperson for Hu says. In addition, farmers receive a Fairtrade Premium. Certified producer organisations then democratically reinvest into projects of their choosing, such as training and development programmes or resources to improve their farms and communities.
“Through this partnership, Hu continues to deliver indulgent, simple-ingredient chocolate and support a more secure livelihood for the people and communities behind their ingredients,” Hu’s spokesperson adds.
A milestone month
Fairtrade month is this October, emphasising brands’ commitment to fair worker wages. The global sustainability-focused organisation references its efforts to make equitable the new normal, highlighting that fairness should never be optional.
Fairtrade is marking its fifth year of commissioning murals in the US as part of the We Are Fairtrade campaign. There are now fifteen farmer murals across the country, with the three latest ones to be unveiled on 19th October in Boise, Buffalo, and Denver.
Designed to celebrate those in the confectionery industry’s collective efforts to build a fairer world, the murals help connect shoppers, grocers, brands and farmers. They aim to raise awareness of consumers’ role in creating a world where the people who grow our food get paid a price that allows them to thrive.
Hu Kitchen is partnering with Fairtrade America to commission a mural in Colorado, US, to elevate the people who grow the commodities Hu counts on, like cocoa, to make its chocolate. By sharing these farmers’ stories, the 100% Organic and Fairtrade-certified chocolate brand hopes to inspire greater awareness of where food comes from and the positive impact that thoughtful purchasing can have on farmers’ lives worldwide.
Generating awareness about the critical need for farmers to receive fair wages remains vital. “It’s impossible to create change if people don’t realise there is a problem,” Archila adds.
