Blog 28.04.20

Could Covid spell an unfair end to fair trade?

Credit: SophieB

Resilience is probably not the first word that comes to mind as Dennis Gakuru, Fairtrade officer at Valentine Growers in Kenya, ponders his unsold, wilting roses.

A well-known expletive is more probable as he and his fair trade farmers bemoan their dependence on a niche and now particularly vulnerable supply chain. Valentine’s expected yearly sale of over 27 million roses has all but dried up.

Covid-19 has underlined how unkind the world can be to those who were counting of being treated fairly.

Of course, Gakuru and his fair traders around the world are not alone. As businesses that supported small enterprises have had to shutter in the face of Covid-19, their suppliers have quickly felt the devastating impact on their livelihoods.

The hit has been especially hard on micro producers with short supply chains, such as cheese makers supplying local restaurants. Once the restaurants close, the small dairy farmer has nowhere to go and their milk literally goes down the drain, with more to follow the next day.

Ironic tragedy

But the irony – or really the tragedy – is that producers of certified fairtrade goods – coffee, cocoa, flowers – have been hit much harder than conventional producers. This is because specialist supply chains have been disproportionately disrupted and the suppliers have few, if any, alternative outlets.

Their sad stories are well told by Fairtrade International as it grapples with the vicious and indiscriminate impacts of the pandemic. One of the challenges facing the fairtrade supply chain is its dependence on smaller and therefore more financially vulnerable buyers. This makes the separated, traceable supply chain − lauded in good times − less resilient to disruption compared with the conventional. 

Certification was facing myriad challenges before the pandemic (see our special report), mainly from buyers who had become disillusioned with the failure to deliver the promised benefits.  It now looks increasingly likely that the lack of resilience will hit the start of the chain and could drive producers away too.  

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Author:
Peter Knight

Chairman and co-founder

Clients:
IKEA, A Global packaging company, A leading global food company




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