Thursday, February 23, 2006

Fair Trade Growing Pains in European Food Industry

Here's an interesting article from Food and Drink Europe, a trade magazine, discussing why European food retailers haven't been rushing to adopt fair trade practices, despite the growth in demand.
A recent study by the UK's Co-operative bank suggests spending on ‘ethical' food, including organic, fair trade and free range, was up from £3.7bn to £4.1bn in the 2004-5 period.

This prompted Melanie Howard, from the Co-op's research partner Future Foundation, to say the results should serve as a “clarion call” to business and government to take the upward trend in ethical consumerism very seriously.

But as yet the food industry has not actively supported fair trade in the same way it embraced the organic movement, nor has the government. Many close to the situation believe this may be because the practice of only sourcing from suppliers with a scrupulous labour policy takes serious logistical planning.

In the case of supermarkets and international manufacturers, ethical trading codes need to be meted out by many thousands of sources across the globe before a company can truly claim to have a secure policy in place.

Unlike the organic and anti-GM movements there is no symbol they can display to show they are fair trade compliant across the board – and even those working towards more ethical trading practices are finding it difficult to keep track of their suppliers.

Moreover, fair trade product returns are still only a drop in the multi-billion pound UK food retailing industry.

That consumer demand has risen to such a point that large retailers even consider this a problem demonstrates real progress. I also have to wonder if, eventually, the demand for fairly-sourced products will eventually lead to a more localized supply chain -- obviously, that would lessen some of the logistical pressures. Overall, I have to wonder if such demands will lead to a recognition that "small is beautiful": in other words, that smaller, locally-owned retailers dealing with less demand and a smaller number of suppliers will be much better at supplying fair trade merchandise across the board. That seems like a logical, and even desireable, outcome -- anyone want to correct me? Or, will consumers ultimately decide they prefer the convenience of the large corporate supermarket, and are willing to forgo concerns about ethical sourcing?

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