What is Fair Trade & Why Does It Matter?

by | Updated: December 3rd, 2016 | Read time: 3 minutes

“Fair trade” shopping allows American consumers to make everyday purchases that help reduce poverty around the world.

Products that meet fair-trade standards earn a label certifying that farmers and other producers in developing nations were paid a living wage for their efforts.

What is Fair Trade & Why Does It Matter?

“(Fair trade) is a model of sustainable development that puts people first,” says Katie Barrow Schneider, senior manager, communications for Fair Trade USA, a nonprofit based in Oakland, California, that certifies fair-trade products.

Organizations that certify items as meeting fair-trade standards also may insist that these foods and goods meet other criteria, such as:

  • Employment standards. Workers must earn a livable wage and must have safe working conditions.The use of child labor is forbidden.
  • Environmental standards. Production processes must have minimal impact on the environment. For example, no hazardous chemicals may be used during production.
  • Price standards. To be certified as a fair-trade product, prices may be raised higher than the open-market price. Often, this extra money is used for development projects in the producer’s region.

Certifying fair-trade products

Elizabeth O’Connell is fair labor campaigns director for Green America, a Washington-D.C.-based advocacy organization that educates consumers and U.S. companies about the value of the free-trade approach.

She says three main groups certify and label products as being fair-trade friendly: Fair Trade USA, Fairtrade America and Fair for Life.

Fair Trade USA audits and certifies transactions between 800 U.S. companies and their international suppliers.

Fairtrade America is part of Fairtrade International, which certifies more than 27,000 products sold in more than 120 countries.

Fair for Life says it goes beyond traditional fair-trade practices and applies the principles to relevant domestic and regional trade. It also insists that fair-trade practices be used along the entire trade chain.

Examples of products certified by these organizations include:

  • Agricultural products, such as bananas, chocolate, coffee, olive oil, rice, sugar, tea and wine
  • Flowers
  • Crafts
  • Products such as soccer balls
  • Seafood
  • Textiles

Schneider says organizations such as Fair Trade depend on consumer support to help make their visions a reality.

“The more Fair Trade Certified products that are sold, the more farmers around the world will benefit,” she says.

She adds that the system makes it relatively easy for consumers to make the globe a more just place.

“Through something as simple as a cup of tea or bar of chocolate, you can benefit entire communities around the world,” Schneider says.

O’Connell agrees that buying fair-trade products helps shoppers live out their deepest ideals and values.

“Consumers should feel empowered to know they can use their spending power to impact communities,” she says.

The price of justice

O’Connell acknowledges that free-trade products sometimes cost more than their traditional counterparts.

“But often, the quality is higher,” she says. “Many are organic.”

She adds that many consumers need to be better educated about how cheap items can carry a hard cost for the farmers and artisans that produce them.

“Sometimes, the cost that we are used to paying for a product might not be the price that it costs to truly produce the product,” she says.

O’Connell says buying free-trade products is getting easier as more retailers offer them.

“It’s changed in the past couple of years,” she says. “You really can find fair-trade products in big-box stores.”

However, you still may have to hunt for some free-trade products.

“I wish every grocery would put the fair-trade coffee in the coffee section,” she says. “But it’s more likely to be in the natural foods section.”

Online retailers such as Vitacost also offer fair-trade products. According to Schneider, Vitacost free-trade products include the following: