Shoppers get an appetite for ethical food as sales soar to almost £500m

Bananas were the most popular Fairtrade product, with sales up 130 per cent to 150 million.

Other staples, such as coffee, tea, wine, fruit, confectionery, sugar and cakes also saw dramatic growth, with more than 60 per cent of the UK public now regularly buying products carrying the Fairtrade certificate.

Coffee sales rose by 24 per cent to more than 117 million while Fairtrade cotton soared by 660 per cent to just under 35 million.

The Fairtrade Foundation yesterday said consumers have turned to ethical products in such numbers because they believe they are helping the world's poor.

However, a leading UK think tank today claims the trade-mark scheme is little more than a marketing ploy that benefits supermarkets.

The familiar Fairtrade stamp is supposed to guarantee farmers are paid a fair price for their products.

But in Unfair Trade, the Adam Smith Institute (ASI) says only 10 per cent of the price paid by UK consumers goes to the farmers, and that the scheme benefits only a few producers while disadvantaging the vast majority.

The ASI report concludes Fairtrade actually holds back economic development by paying inefficient co-operatives, and discourages diversification within the markets.

It claims that the scheme helps the landowners, rather than the agricultural labourers who suffer the severest poverty.

The majority of Fairtrade farmers are based in Mexico, a relatively developed country, rather than Africa, where the public perceive them to be, the report adds.

Tom Clougherty, ASI's policy director, said: "At best, Fairtrade is a marketing device that does the poor little good. At worst, it may inadvertently be harming some of the planet's most vulnerable people.

"If we really want to aid international development we should instead work to abolish barriers to trade in the rich world, and help the developing world to do the same. Free trade is the most effective poverty reduction strategy."

Yesterday, both the Fairtrade Foundation and Sainsbury's , the UK's leading Fairtrade retailer with 29.4 per cent of the market, refuted the ASI claims, saying the report was "poorly researched".

Harriet Lamb, executive director of the Fairtrade Foundation, said: "The fantastic increase in sales show the UK public's huge and growing appetite for Fairtrade. After years of chipping away, Fairtrade is finally beginning to make some significant impression."

A spokeswoman for Sainsbury's said its policy to sell more Fairtrade products was based on consumer demand.

All bananas sold in their stores from July last year carry the Fairtrade certificate.

She said: "The retail price of bananas is exactly the same as before the conversion, which means we are giving customers the chance to buy Fairtrade at the same price as less ethical products. This is supporting farmer's livelihoods in the developing world."

Both reports were released today to coincide with the start of the Fairtrade Fortnight public awareness campaign.