Why fair trade is fair enough - up to a point

Published on Tuesday 7 August 2007 01:03

I HAVE a guilty secret. Every time I go to the supermarket, I buy fair-trade bananas. Sometimes I also buy fair-trade coffee. If I'm feeling flush, I'll buy organic produce. Occasionally, I go to the local farmer's shop and buy locally-grown produce, also all organic. There, I've admitted it.

What is there to feel guilty about that? Surely this is what we all should be doing, supporting poor people in third world countries, supporting local farmers and helping to reduce the amount of chemicals poured into the land? Well, I used to think so, but now I feel guilty about it because there is a mounting pile of evidence that I am making the plight of poor farmers worse and damaging the environment.

Take the fair trade movement. This is surely one of the best-designed development aid programmes there has ever been. Instead of being squeezed by big multi- national companies, farmers in places such as the Windward Islands in the Caribbean get a guaranteed decent price for their bananas.

The scheme works by guaranteeing a minimum price for bananas. If the market price falls below this floor, the farmers still get the guaranteed minimum. If the market price rises above the floor, the farmers are guaranteed that they will get a price set at a margin above the market price, usually 5 per cent. We pay the extra price in our local supermarket and the money goes to the farmer instead of into the bank account of some rich multinational company.

What's wrong with that? Fair trade supporters argue that it is a triumph of the free market. The problem is that there is a reason prices are low - more bananas are produced than the market actually wants. If you were a poor farmer in the Windward Islands, wouldn't you go for this scheme? No more worries about having no income. Indeed you would probably seek to grow more bananas because that is a surefire way of increasing your income.

Actually, as many farmers in the West know, a better way of guaranteeing your income is to diversify into other products so that if the price of one goes down you have alternative crops. And a big problem for places such as the Windward Islands is that they become all too dependent on bananas.

This could become quite a serious problem. Almost all the commercially grown bananas in the world come from one variety, the Cavendish. And the Cavendish is now becoming prone to disease. So there is a risk of a disaster such as the potato blight which devastated Ireland in the 19th century. What will fair trade do about that?

All right, so what's the problem with organic, locally-grown produce? Organic, as I understand it, means that no nasty artificial chemicals are used to kill bugs and weeds, and organically-reared animals are similarly free of chemicals. This means no use of unsustainable materials such as oil and gas from which many chemicals come, and no use of energy in making those chemicals. Surely that's a good thing?

It might not be. The thing about bad old non-organic farming is that it is intensive - much more grain per acre is produced than under organic grain farming. The world grain crop tripled between 1950 and 2000, but only 10 per cent more land was used. And someone has calculated that if all the world's farms converted to organic farming, we would need three times more farmland than is presently used. Goodbye rainforest, then.

OK, SO what's the problem with getting locally-grown, perhaps non-organic, produce from the farmer's shop or market? Surely this means that it is not shipped in from hundreds, perhaps thousands of miles away (like bananas), saving all the energy used in transport?

Good point, but the fact is that around half of the energy used in trucking food about the country is actually used by you and me going to the supermarket. And since going to the farmer's shop usually means a longer journey, and you don't get things like toilet rolls and washing-up liquid there, you still have to go to the supermarket. So we wind up using more petrol, not less.

Indeed, the supermarkets are enormously efficient at shipping large quantities of food around the country. It is, for example, more energy-efficient to ship tomatoes from Spain than to grow them in heated greenhouses here.

If the idea that we can change the world by changing our shopping might be a delusion, is there another way?

Yes, but it involves big political solutions which have unacceptable political prices. We should abolish farming subsidies in Europe and America, which keep poor countries' produce out of our markets. Note that the old guaranteed price system under the Common Agricultural Policy, which produced butter mountains and wine lakes, operated in much the same way as fair trade does.

We also need a global carbon tax regime so that the cost of causing environmentally harmful emissions is reflected in the price of food we buy. Online shopping and getting the supermarket to deliver are environmentally efficient, so maybe we should put a price on parking at the supermarket. Local farmers could also develop online shopping methods - there is one already operating in Fife.

If there is a benefit in buying fair trade, organic and locally-grown products, it shows that consumers are ahead of the politicians in trying to do something about the environment. That might encourage them to be bolder. In the meantime, I'll comfort myself with that thought and feel less guilty about fair trade bananas.