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European Supermarkets Going Bananas Over
Fairtrade
European
supermarkets are investing heavily in fairtrade products, with most
commitment going to bananas and
beverages.
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A number of
leading supermarkets are committing to selling only fairtrade
bananas in their stores. Co-op Switzerland was the first to convert
all its bananas to fairtrade in 2004.
The UK now has the largest market for
fairtrade bananas because of similar commitments by Sainsbury’s and
Waitrose. Over a quarter of all bananas sold in the UK are now
fairtrade; the highest market share for any EU
country.
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Sainsbury’s is
the frontrunner in the UK market. The retailer has the highest
market share of fairtrade product sales. Apart from bananas, all its
coffee, red label tea, sugar and coconuts are fairtrade. It also
plans to convert its remaining tea and hot chocolate to fairtrade by
2010. The supermarket also set up a Fair Development Fund last year.
The EUR 1.3 million fund supports fairtrade initiatives in African
countries.
Fairtrade
initiatives by retailers aim to capitalise on the rise in ethical
consumerism. Fairtrade products are popular as growers are
given a fair price and profits are channelled into social projects.
Over 1.5 million producers and workers in 58 developing countries
are involved in producing certified fairtrade products.
With global sales
expanding by 47% to EUR 2.3 billion in 2007, the market for
fairtrade products looks to follow the startling growth of the
organic products market. Global sales of organic food & drink
surpassed the US $40 billion mark for the first time in 2007.
Although the organic and fairtrade product markets are driven by
ethical consumerism, there are many differences between them.
Organic
standards are based on
a controlled production system, whereas fair trade standards
are based on a pricing mechanism that benefits third world growers.
The major advantage fairtrade has over organic is
that it involves one universal standard. Organic standards have
wider implications, covering agricultural inputs, production
methods, ecology and animal welfare. Both
standards however involve eco-labelling
in which certified products have clearly visible symbols and logos.
Both the
organic and fairtrade product markets are showing high growth,
however future growth depends upon how much the
standards diverge or converge. There are already calls for
organic standards to encompass social issues like child labour and
environmental issues like carbon footprints. Likewise, fairtrade
standards could also include ecological and sustainability aspects.
Standards are likely to evolve to encompass some of these
attributes. In the meantime, European retailers are currently taking
advantage of ethical consumerism by playing both the organic and
fairtrade cards.
Related Report:
#1002-42 The
European Market for
Ethical Fruit & Vegetables
Posted: June 11th 2008
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