About Fairtrade

What is fair trade?
Fair trade is an alternative approach to conventional international trade, which aims to share the benefits of trade more equitably between consumers, producers and the environment. Through fair trade, farmers are paid a fair and stable price for their produce so they are protected from the damaging fluctuations in world market prices. In addition, their community receives a social premium to invest in local development projects such as education and healthcare. Workers are also paid a fair wage, and the use of forced labour and abusive child labour is prohibited. FTAANZ supports two systems of fair trade – the FLO system (the FAIRTRADE product Label) and the WFTO system, which accredits Fair Trade Organisations. This info sheet is about the Fairtrade labelling system. To find out more about the WFTO system (formerly IFAT), visit www.fairtrade.com.au/IFAT 


Why is fair trade important?
Poverty is widespread amongst tea, coffee and cocoa growers around the world, who face an uncertain future due to unstable world prices. In recent years, volatile prices worldwide have left many disadvantaged producers struggling to support themselves and their families.


What does fair trade guarantee?
A better deal for producers in the developing world through:

• A fair and stable price for their produce
• Security of long term contracts
• Investment in local community development
• Improved working conditions
• Environmentally sustainable farming methods
• Support in gaining the knowledge and skills needed to operate successfully in the global economy

What is the FAIRTRADE Label?
The FAIRTRADE Label is an independent consumer certification label which appears on products as an independent guarantee that disadvantaged producers in the developing world are getting a better deal. As a result of Fairtrade, these producers receive a minimum price that covers the cost of sustainable production and an extra premium that is invested in social or economic development projects.

For a product to display the FAIRTRADE Label it must meet international Fairtrade standards. These standards are established by FLO International e.V. and are set in accordance to the requirements of the ISEAL Code of Good Practice in standards setting. They are in addition the result of broad consultations of different stakeholders and external experts. Producer organizations that supply Fairtrade products are then certified against these standards by FLO Cert GmbH, an independent certification body, which carries regular inspections. The Fairtrade labelling system began in The Netherlands in 1989, and currently operates in 20 countries. It was introduced in Australia and New Zealand in 2003. Fairtrade Labelling Australia & New Zealand (FLAANZ) is the independent licensing and certification body for the FAIRTRADE Label in Australia and New Zealand.

Consumers can be assured of the benefits flowing from their purchase of products bearing the FAIRTRADE Label because there is a monitoring and auditing system behind that label that applies to all participants in the supply chain of the product. This includes Fairtrade Certified producers (who comply with Fairtrade standards), Fairtrade registered importers (who pay a Fairtrade premium, in addition to minimum prices, that supports social, economic and environmental development) and Fairtrade licensees (who a licensed to apply the Fairtrade label to packaged products and sell them in to the market).


How can I tell if a product is Fairtrade Certified?
Always look for the Label - Fairtrade Certified products always have the FAIRTRADE Label on the front of their packaging.


How big is the Fairtrade market?
Globally consumers spent an estimated US$3.62 billion on Fairtrade Certified and Labelled products in 2007. This was a 48% increase on the previous year. Today, more than 5 million people – farmers, workers and their families – across 58 developing countries benefit from the international Fairtrade system.