Why Fair Trade isn't Always the Answer

The Purpose of Fair Trade

The Fair Trade system was born to try and bring some justice back into international trade. Many developing countries are still dependent on the production and export of agricultural products, but standard international trade rules often put them at a disadvantage. Finding a way to pay a fair and guaranteed minimum wage to the producers of these countries was of course a very good idea.

Quickly, this is how it works. Fair Trade buyers undertake to pay a certain minimum amount for a product. The buyer must pay the market price if it is higher than this set minimum. But if it lower than the set minimum, then the buyer must pay at least this minimum price.

This minimum guaranteed revenue protects the producers against sudden dips in the global market prices. All the products and corresponding minimum prices are listed in a publicly available table.

The majority of these agricultural products are those traded globally and at high volume: the commodity crops.

What are commodity crops?

Commodity crops are the staple food crops that are exported / imported in high volume: wheat, rice, bananas, coffee beans, tea, sugar… Commodities also include non-food items that are necessary to the standard 21th century westernized way of living, such as crude oil, coal or iron ore, to name but a few.

What distinguishes them… is that you don’t. Literally. The market treats these products as entirely interchangeable with another of the same sort. Bananas grown in one country have the same value as bananas grown in another. Same for sugar. Same for tea. Same for coal.

Darvaza Teas Cup of tea with an anonymous tea bag

Fair Trade isn’t Always Relevant

The crucial point is that the Fair Trade way can only help the producers of those commodities. Whether it does so effectively is a completely different discussion, which I will not get into today.

So the argument for buying Fair Trade tea in the supermarket is, well, fair. Supermarket brands that aim to purchase and sell tons and tons of tea, as well as to achieve the most standardized taste possible, may not offer the best deal to the producers, but at least it isn’t the worst.

But what if, instead of talking quantity, we’re talking quality?

Quantity vs individuality

Let’s admit it, most of us do not look at the country of origin of our bananas, we tend to focus on their ripeness!

However, specialty items like single origin loose leaf teas are an artisan product. They carry within them a specific terroir, a skill-set, sometimes even a history. It is their quality, and not their quantity, that drives their price.

There is no Fair Trade provision for such products because the Fair Trade system actually recognizes the difference. In fact, everyone can see it in the table mentioned above: only the CTC tea prices are quantified in the table, and not the orthodox tea prices*. The latter follows the market prices, that is to say, its price must be negotiated individually based on the current market price.

Darvaza Teas Himalayan Loose Tea

Respecting the character of the tea

Darvaza Teas does not buy commodity tea. It’s not who we are, it’s not the tea we want to drink, nor the one we want to offer.

We specialize in those exceptional Indian teas that were grown by artisans of their trade, highly skilled and themselves highly specialized. So you see, for us, the Fair Trade system is not relevant. No matter what, we will pay a higher price for our teas because where they come from matters. How they were plucked and processed matters. Because they are unique.

The beauty of artisan tea is that we pay what they are really worth, not whatever the market says. And that is how we ensure that the producers and their workforce and their families get just wages and lead a decent life.

(photos by Olena Sergienko on Unsplash and Darvaza Teas)

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