There has been a big rise in certification schemes over the past 10 years, said Amarjit Sahota, founder and president of Ecovia Intelligence, a research company that focuses on global ethical product industries, while 34.5% of all coffee produced today is certified according to a third party scheme.
‘Confusing mismatch for companies and consumers’
However, with now over 200 eco-labels to choose from it risks creating confusion for consumers and companies, and the proliferation of third-party eco-labels and in-house certification schemes from big companies also risks a drop in standards.
“One of the criticisms of the Fair Trade scheme was that they set the bar too low,” he said. “If you look at the UK – the biggest market for Fair Trade products -- they had so many chocolate products that were certified Fair Trade, but the percentage of Fair Trade ingredients was less than 5%... that switches off a lot of consumers. When you’ve got an organic product which is more than 95% organic ingredients and a Fair Trade logo with less than 5% fair trade ingredients - there’s a mismatch.”
He added: “We’re also seeing more and more single-ingredient eco-labels. If you’re a biscuit or a cereal manufacturer, what’s the implication of that? How many of these labels do you want to put on your product packet? The general trend is this: proliferation of eco-labels. We’ve got over 200 eco-labels in the food industry today and the numbers continue to rise. Will we see 400 or 600?”
‘What’s the implication of the lack of certification in the plan-based trend?’
While he was concerned about the proliferation of eco-labels, he was equally concerned how a lack of certification in new plant-based foods would impact standards. “Going back 10 years ago, nearly all the plant-based foods, especially here in Europe, were certified organic,” he told the audience at the 11th European edition of the Sustainable Food Summit. “Now we’re seeing more and more plant-based food being introduced, but very few are taking up the certification route. The implication there is consumers are buying these products because of health, ethical and environmental reasons, very similar to organic and other eco-labels, but these products are not certified. What’s the long-term implication of that?”
A ‘rich man’s luxury’
Another challenge for sustainably and ethically produced foods was the perception among consumers that they were a 'first-world problem' only taken up by the wealthy.
The sustainable market had grown massively over the past 20 years – from $20 million in 2000 to be worth $105.5 billion in 2018, explained Sahota, but sales were concentrated in Europe and North America. “The perception there is: are sustainable foods are ‘rich man’s luxury?’”
For all the growth of the sustainable market, price remained the “biggest deterrent of organic products and Fair Trade,” he said. What’s more, “awareness of sustainable foods does not always translate into sales,” he noted. In Germany “92% of consumers believe Fair Trade can make a difference, but only 68% are buying Fair Trade products.”
According to Ecovia, across Europe 32% of all consumers have claimed that eco-labels have an impact on their purchasing decisions. However, looking at market shares in Europe, only Sweden, Switzerland and Denmark have market shares for organic food at over 6%.
He also hoped that recent big company mergers – notably Amazon’s acquisition of Wholefoods, and Carrefour’s takeover of So.bio -- would not dilute standards.
Other solutions are needed
“In the cocoa sector, we have to say that these [certification] organisations have still not succeeded in overcoming poverty,” added Julia Gause, head of sales at Fairafric, producer of first organic chocolate bar that is manufactured and packed in Ghana.
“If you look at Fair Trade certified farmers the Ivory Coast, a study last year from Fair Trade Germany showing that more than 50% of the families that grow Fair Trade certified cocoa still live below the poverty line. So we have to ask: is Fair Trade a solution or is there another way of overcoming poverty?”
Fairafric’s solution is by producing in the country where the ingredient actually grows -- in its case in Ghana. Last year, it began making its cocoa farmers in the country brand co-owners by buying them shares in the company.
“We want to redefine ‘what is fair trade’ as an idea,” she said. “The idea is to create truly sustainable development by creating jobs in the chocolate industry and beyond.
“If we bought the cocoa beans from Ghana the market price is around $2,000 per tonne. Instead we deliver an income worth $10,000 per tonne so we multiply the local income for the country of origin.”
This method relied on consumers paying a premium, however. “The price for the bar is definitely not the cheapest you can find in the market. In Germany, it’s sold at three euros per 100 grams. So we are very dependent on customers being willing to buy the story behind it. But it’s also a better quality cocoa.”