Fairtrade sales drop in the UK for first time in 20 years

By Joyeeta Basu contact

- Last updated on GMT

The organisation is banking on Mars to boost sales in the UK and Ireland
The organisation is banking on Mars to boost sales in the UK and Ireland

Related tags: Fair trade, Fairtrade

Sales of Fairtrade goods fell nearly 4% last year in the UK as consumers turned to cheaper alternatives at grocery stores.

Demand for its products fell 3.7% to £1.67bn (€2.2bn). Fairtrade said it was a direct reflection of a wider grocery trend as consumers tighten their belts.
 
“For the first time in our 20 year history, the traditional grocery market has been contracting, and the value of food spending is in decline. Given Fairtrade is increasingly part of this mainstream, it’s no surprise that these wider trends are having an impact on Fairtrade sales,”​ said Michael Gidney, chief executive at the Fairtrade Foundation.

The foundation told FoodNavigator that it would like to increase its presence in discount supermarket chains such as Aldi and Lidl to increase sales volumes as more consumers turn to them.

Though they do store some Fairtrade goods, they make up a much smaller proportion of sales than in some of the other supermarkets.

While value sales were down, volumes sales for certain commodities such as sugar, bananas, coffee and flowers were growing. Bananas (up 3%) and coffee (up 2%) had risen marginally and flowers bloomed with a 30% increase in sales, overall figures remained down. Volumes of its tea and cocoa sales however fell slightly, by 1% and 2% respectively.

Innovations to boost sales

The organisation is banking on chocoholics to boost sales when Mars bars in the UK and Ireland will use Fairtrade cocoa from under the body’s new Cocoa Sourcing Programme.

Mars agreed to source all cocoa from Fairtrade certified sources by autumn 2015, taking total Fairtrade Premiums paid by Mars globally to Fairtrade cocoa cooperatives in West Africa to €1.7m per year by 2016.

“Business appetite to collaborate with Fairtrade remains incredibly strong,” said Gidney. “To have Mars leading the way with the first commitment to our Fairtrade Cocoa Sourcing Program, on such an iconic brand as Mars Bars, is fantastic news both here in the UK and on the ground with cocoa cooperatives in Côte d’Ivoire.”

The news comes in addition to Fairtrade forming a partnership with Waitrose last week to oversee the supermarket’s own ethical trading scheme.

The foundation will provide guidance to the retail giant to “build upon a sustainable supply chain model to benefit producers in developing countries”​, it said.

Last year the company introduced new rules to bulk buy a single commodity as Fairtrade rather than requiring companies to source all ingredients for a brand on Fairtrade terms. For example a company can buy 15% of its cocoa requirements for a brand as Fairtrade. It was seen as opening up new opportunities for Fairtrade suppliers of cocoa and Fairtrade International had forecast that an additional €1.05m in Fairtrade premiums would be paid to farmers in 2014.

Correction: ​This article has been altered to clarify that the 4% fall in sales only referred to Fairtrade products in the UK.

Related topics: Market Trends

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