It’s time to take another significant step towards ensuring the smallholder farmers around the world who we all rely on for 80% of our food earn enough to sustain themselves and their families, and to invest in the future of their farms.
Purchasing the food we take for granted at ever decreasing prices, while farmers who supply it struggle to survive and maintain their farms, is not sustainable.
From the start Fairtrade was set up to address poverty amongst farmers and producers all around the world and to work to deliver them a sustainable livelihood from the crops they grow. Divine Chocolate was established not long after with that aim at the heart of its mission. Ensuring Fairtrade terms with the cocoa farmers was our start point – but we took our commitment a step further and created a new business model where those farmers owned the biggest share of the company and received both the additional finance and access to the cocoa industry that ownership delivered.
Fairtrade has achieved extraordinary things – including creating a generation of millions of consumers worldwide who have been made much more aware of where their food comes from – and that people, like them, depend on what we buy for their livelihoods. For farmers it has ensured reliable long-term trade partnerships, and some protection against the volatility of commodity markets.
Divine has led the way in the chocolate market – both engaging consumers and helping them be part of a virtuous circle where both farmers and consumers are empowered, and, as well as paying farmers the Fairtrade premium, delivering profit share, and 2% of annual income towards priority farmer-led programmes.
And yet – 25 years after Fairtrade was first established in the UK – farmers are still living in extreme poverty. The extra premium delivered with every Fairtrade transaction is not enough. It’s vital to look at what we mean by a ‘Living Income’ for farmers – and we need to reinforce our efforts to deliver it.
What is Living Income?
Fairtrade International has focused its efforts on reviewing what a Living Income really means for farmers (see more info here). If we here in the UK earned just enough to keep food on our plates, we still wouldn’t be able to pay rent, bills, for clothes – this is what we would call extreme poverty. Obviously poverty is relative - many of the things we can take for granted here – electricity, plumbing, medicines, for example – are currently are out of reach of most cocoa farmers.
We have brought these issues home to the public over the last 20 years – making people think more about the issue by asking, given the little they can earn, ‘why would anyone be a cocoa farmer?’. We have listed all the essential outgoings a farmer has to keep his or her family fed, cared for and educated, as well as keeping their farms productive and adapting to climate change, and how impossible it is to manage this on the kind of average earnings they are making.
The most recent Fairtrade report on cocoa farmer incomes in West Africa (with a focus on Cote d’Ivoire where most cocoa comes from) – shows that 58% are still living in extreme poverty, while thousands more have incomes below which they cannot reliably meet the normal costs of living and running a productive farm. The new assessment of Living Income for a typical cocoa farmer in West Africa has systematically taken into account every single element of a farmer’s outgoings, taking into account size of family, and size of farm. It looks at what constitutes a decent standard of living, labour costs (ensuring a living wage to farm workers), loan costs (usually at highly inflated rates), and it looks at if and how increased productivity will help so the farmer can sell more.
Fairtrade International has calculated that a Living Income for a farming family of eight in Cote d’Ivoire is $8965. With a good level of productivity that would mean the average farmer needing to earn $2668 per tonne of cocoa. The current Fairtrade minimum is $2000 per tonne 62% of which ($1327) gets to the farmer. Fairtrade is already in the process of raising the minimum to $2400 – this is a good step forward but is still not enough.