Fairtrade sugar was initially launched in several European markets in the late 1990s, followed by the UK in 2000, in order to improve the position of small-scale sugar cane growers and their dependent communities, which were being undervalued by the global sugar market. Through Fairtrade certification, and by working in partnership with sugar cane processors, sugar cane farmers can get improved access to international markets and develop the necessary business skills and technical capacity to be more competitive in the global market. Currently, 96 farmers’ organisations representing 61,800 smallholder cane farmers are part of Fairtrade certification for sugar. This includes farmers in extremely poor countries such as Malawi, Swaziland, Zambia and Guyana.
Unlike for many other products, there is no Fairtrade Minimum Price for sugar. A stakeholder review of the sugar standards in 2009 highlighted the complexities of price setting in the sugar sector – a sector that is characterised by structural differences in sugar supply chains, government-set prices and distortions caused by international trade regimes. The conclusion was that it would be more effective for sugar prices to be negotiated between producers and traders rather than through the minimum price mechanism. The main economic provision of Fairtrade Sugar Standards is the Fairtrade Premium of $60 per tonne of sugar ($80 per tonne for certified organic sugar) in addition to the negotiated price. In 2011-12, sugar farmers received approximately £8 million in premium income of which 47% was invested in direct support to farming families. This included access to agricultural inputs, credit services and in-kind support and cash payments to help with living costs and needs.
This investment is beginning to make an impact and the UK’s contribution to global Fairtrade sugar sales is significant. Fairtrade sugar sold in the UK comes from countries including Belize, Fiji, Guyana, Jamaica, Malawi, Mauritius, Paraguay and Zambia. In Malawi, farmers have used the premium to build essential community infrastructure such as water boreholes, building primary schools and electrification of villages. In-kind support to farming families through provision of maize, essential household goods has improved food security in the region. Read more about the impact of Fairtrade sugar in Malawi.
In Belize, which supplies most of the UK’s Fairtrade sugar, the impact has been transformational. Fairtrade Standards have ensured that the farmer’s association functions democratically and represents it 5,400 members. Investments of the premium in a Quality Improvement Programme and integrated pest management have boosted production post 2011 by 30%, resulting in a 42% increase in the cane price received by farmers. Watch this video for a preview of Fairtrade’s impact in Belize.
Fairtrade’s support goes beyond individual farmer stories. For cane farmers at Manduvira co-operative in Paraguay, April 2014 was a milestone as they became the proud owners of a sugar mill ensuring that they are now able to capture more value from the sugar supply chains. This $15 million project was funded through a combination of national and international loans, contributions from the Fairtrade Premium, and theFairtrade Access Fund.
Is the job done?
Fairtrade sugar has seen remarkable growth in the UK and this impact is being felt by cane farming families. But a formidable challenge remains in the coming years with changes to international trade rules that affect sugar. Changes in EU legislation in 2017 will make life harder still for smallholders in countries that sell to the UK. These smallholders will continue to need support from Fairtrade.
Also, many of the farmers we work with would like to sell more Fairtrade sugar, and there are still millions more we haven’t reached. Today, less than 1% of the world’s cane sugar is Fairtrade. Meanwhile, more and more companies are making commitments to source their sugar sustainably. They’re looking for ways to use it across their business, in all kinds of sweet treats and beverages. The Fairtrade Sugar Program enables sugar producers to work with these companies and access these great new opportunities.
Taken from Fairtrade Foundation website.