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Some Insights Into What FTUSA Leaving FLO Means for Producers & the Movement – According to a Producer Leader

On November 1, FTRN produced Webinar 118: A Community Discussion of What FTUSA Leaving FLO Means for Producers and the Movement-Part 2 with a Producer Leader.  The panelist was Jerónimo Pruijn van Engelen, Executive Director of FUNDEPPO/Small Producers´ Symbol, and CLAC Delegate to Fairtrade International’s Standards Committee (CLAC-Latin American and Caribbean Network of Small Fair Trade Producers owns FUNDEPPO, which is managed independently from CLAC), and moderator was Jeff Goldman, Executive Director of Fair Trade Resource Network. Part 3 with FLO, and Part 4 with both FTUSA and FLO, are expected as webinars in coming weeks. You can download the 50-min recording of webinar 118, or register for upcoming webinars, at FTRN webinars.

Some of the speakers’ main points from the webinar include comments below.Some history of Fair Trade certifications-
Fair Trade as a concept came from the southern small producers (80s)
Fair Trade at its start was a synonymous to grass roots Small Producers´ Organizations (SPO)
The concept was “widened” in the North to include Plantations and others
Structures and vision became much more market than producer driven
Different visions within the FLO members

CLAC struggle-
The CLAC (SPO´s of Latin America and the Caribbean) have been struggling for 20 years to gain power within FLO
The CLAC and its members have and still put many resources into this
The CLAC is the only continental FT Producer Network of only SPO´s in FLO system
The CLAC advocates for the interest and values of SPO´s, inside and outside FLO

Main problems with the split-
Producers do not share the Fair Trade for All (FTFA) vision, for being only market oriented and not respectful of producer realities
Producers question the governance structure of FTUSA /FTFA; no broad backup or democratic participation of producers
No clear control system and discounts
It does not add any value to producers

Expected impacts of the split-
Unloyal competition by private plantations and big corporations
Standards against the interest of small producers; in favor of big players
Losses of markets, visibility and/or benefits for SPO´s
(Even) less influence on the system by SPO´s
Loss of credibility of Fair Trade and its certification systems

Small producers propose-
Maintain the struggle towards FTUSA and also FLO of the interest of SPO´s and the original values of Fair Trade, such as self-managed sustainable development, strengthening of local organizations, markets and economies
Promote the Small Producers´ Symbol as a way to differentiate ourselves in the (fairtrade and sustainable) markets with all the values the producers stand for

It is strange that FLO and other certifications have resisted equal power for producers within certification systems, perhaps because FLO was afraid producers would break down the markets, or that labeling initiatives would lose power. FLO did recently make the important change of giving 50% of highest decision power to producers, possibly because of worry that producers would leave FLO system.

Small producers were not “at the table” when FTUSA made the decision to leave FLO, probably because FTUSA knew small producers would disagree.

CLAC believes large plantations are kicking small producers out of the Fair Trade market, as large plantations have done in other markets. The market will not grow for small producers, only for large (monopolistic) ones, so CLAC doesn’t believe in “Rising Tide” theory.

CLAC is reconsidering its participation in COOPLINK, FTUSA’s program to strengthen coops, since CLAC’s initial commitment was made before the split came as a disappointing surprise to CLAC.

The Small Producers’ Symbol seems just as important after the split, as before, as a tool for small producers to differentiate themselves.

Asia and Africa producer networks built themselves by including hired workers, while CLAC didn’t, so the 3 producer networks have some different interests, despite many common interests, for small producers.

Small Producers’ Symbol system was created using ISEAL principles for labels and ISO 65 principles for certification, so the system has good credibility.

As an example of FLO standards favoring big producers, compliance costs are more burdensome for small producer organizations, so they are at disadvantage when receiving the same minimum price for their products like bananas.

A big part of consumers still think Fair Trade mainly benefits small producers, but the reality is quite different. So, the differentiation of SPOs is critical for ensuring benefits to SPOs.

The main worry of producers, due to the split, is what will happen to their markets and to their certifications. Those challenges are in addition to prior ones such as climate change and unreasonable price volatility.

4 Comments

  1. Ted Weihe

    I have been involved in cooperative development internationally for 35 years. The long history of coops is about opening market space for small producers against oligarchic forces. The way to expand the markets for cooperatives is to treat them as group-based businesses, adopt standard coop financial principles of member equity based on usage and not to expect them to carry out social programs under FT. We need to work together to grow small farmer coops so that they have market power, reach more poor farmers and address anti-competitive practices by larger farms and plantations. FT premiums should used to built equity of members which will result in more loyalty, and not for feel-good social projects which NGOs and others can do better.

  2. Mark O'Brien

    I heartily agree with Jeronimo Pruijn van Engelen. It is fairly obvious to the entire world that FTUSA has permanently and finally discredited itself, and no longer has a place in the fiar trade movement. Plantations ain’t fair trade, no matter what anybody says or does, but they can afford to pay certification fees, the collection of which is clearly the only cogent goal of FTUSA. Boycott FTUSA products, or better yet, rip them from the shelves and hurl them into the streets, denounce the vendors who stock them, and flagellate the FTUSA staff with long bamboo canes…so as not to contaminate yourselves…

  3. Michael

    @Ted
    Fairtrade Premiums are used however the coops’ members want them used.

    They’re in the best position to understand their own needs and, whether they think they most need to build member equity or something else, it’s entirely their call.

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