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Fri 1 Jun 2007 12:00 AM

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Behind the label

Sales of Fairtrade products are soaring in the Middle East, but not everyone in the food industry is convinced of their merits.

In order to acquire the Fairtrade tag, companies must pay farmers higher than market price for products, which leaves extra money to be invested for the common good; like children's education and social needs.

In the UK last year, a staggering AED2.1 billion (US $561,000) was spent on Fairtrade products across 2,500 product lines, an increase of 46% from 2005. Fairtrade coffee sales for catering establishments shot up by 39%, and tea by 50%.

Now the demand and social responsibility of Fairtrade is beginning to be recognised by retailers, hotels and suppliers in the Middle East, with 2007 likely to be a record year for fair trade goods. But in the Middle East, the sector is still in its infancy, and is looking to more established markets like the UK and South Africa for guidance.

"Fairtrade coffee has been present in Dubai for some time now, primarily in niche markets," says Justin Clarke, founder of Orbis Coffee Roastery Dubai. "What we bring to the market is a wider availability for these products across the foodservice sector, which is important as the market matures and operators look to create a point of difference,"

Francis Falconer, general manager of Orbis Coffee Roastery Dubai, adds that while demand may increase and the market matures, the chief audience for Fairtrade beverages are tourists staying at the city's four-and five-star hotels.

In the UK, for instance, substantial demand has been witnessed in recent years for drinks with a conscience, as more cafe chains move into Fairtrade, in turn seeing profits soar. Mike Steel, managing director of hot drinks company Fairtrade Vending, has reported a doubling of turnover in the past year, while coffee buyers are also benefiting.

UK-based Cafédirect, for example, is reaping the dividends of its Fairtrade coffee sales, as it buys coffee from 37 organisations in 12 countries, and now has two products positioned in the country's top 20 of best selling lines; its medium roast standard and its decaffeinated organic.

"Businesses often tell us that their sales increase when they make the switch, which is excellent news for the farms in developing countries," says Martin Hill, head of commercial relations for the Fairtrade Foundation.

The Fairtrade label has, however, been subject to dispute over its effectiveness in helping farmers in the developing world. Critics of the movement argue its efforts to achieve fair prices distracts from addressing issues such as industrialisation.

One opponent of Fairtrade certification is Nils El Accad, CEO of Organic Foods & Café in Dubai.

"I get a lot of products from South Africa, working directly with the farmers and paying far more than market prices, but I'm not forcing them to go Fairtrade. I choose to work with farms based on the condition they are family-run and genuinely organic. I don't buy from multinationals, and I pay a premium without demanding certification," El Accad says.

Despite El Accad's views on the movement, Organic Foods & Café's product portfolio includes Choice Organic Teas, which became the first US brand to offer Fairtrade certified organic teas in 2000, and is now available in the Middle East region.

Boasting 48 varieties, including green Moroccan mint, mango ceylon, orange spiced, northwest blackberry with herbal infusion and chamomile spearmint, the brand says it guarantees fair wages, working conditions and a worker-managed premium.

In this case, the premium represents additional funds paid for by Fairtrade registered importers directly to tea workers, who collectively decide how they want to manage the funds. Tea estate workers producing the company's white tea, for example, have decided to provide scholarships to estate children who want to attend university, while other premiums have been dispensed to people who need medical assistance.

But El Accad believes hotel groups in Dubai, currently representing 10% of his business, are purchasing Fairtrade teas and organic coffees due to their quality, rather than the fair production methods and certification.

"Fairtrade is not sustainable. The tea company certifies one company, and then buys from another. I know two farmers that went bankrupt as the retailers ditched them. Most suppliers here are doing it for a buck. How fair is that?" he asks.

On the other side of the fence, for Malongo coffee workers at the Bergandal Boerdery collective in South Africa - which harvest its Rooibos blend - the funds are used for community programmes, including lectures in HIV and AIDS education, first aid treatment, and life skills training for women.

And as part of Accor's sustainable development policy, Novotel and Ibis World Trade Centre in Dubai introduced Malongo Fairtrade coffee - of which 21 tonnes had already been sold across the Sofitel chain in 2004. Available across all of Accor Dubai's outlets since May 2005, Malongo's coffee carries the Max Havelaar label, which was officially launched in 1988 to distinguish Fairtrade products from conventional ones.

To ensure a well-informed debut of the certified brand, Malongo provided training for front of house staff at the two properties, with the coffee produced in Mexico, Guatemala and Haiti, and the aim of preserving the ecology of the region.

"Offering Fairtrade makes a lot of sense, as we're giving something back to the community. We've made some noise about the significance of the movement and produce special menus outlining the objectives of Fairtrade," comments Michael Kasch, food and beverage manager, Accor Hotels World Trade Centre.

Kasch believes the presence of Fairtrade beverages is likely to grow as Accor opens up new properties across the region, and rising numbers of hotel groups unveil their sustainable development programmes. He says the response to the products among guests has also been positive, and there is real potential to expand its certified products to other food and beverage segments.

High numbers of companies offering Fairtrade brews have also pledged their commitment to optimising crops and maintaining regular contact with the growers. Malongo, for example, has forged a partnership with the Uciri cooperative in the Chiapas Mountains in Mexico - which groups together 2500 small growers and 55 Indian communities - as well as communities in Haiti and the Farfell plantation in Zimbabwe.

"Fairtrade is beginning to move from being an optional extra to a must-do. It is redefining what is acceptable behaviour for all of us and is rapidly triggering changes," comments Harriet Lamb, executive director, Fairtrade Foundation.

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