Facing the crisis

80% - Kasinthula Cane Growers Malawi, families now spend 80% of income on food (was 50%) 1/3 - of humanity is reliant on small scale agriculture $3.7bn -  the drop in aid to agriculture. Reduced from $7.6bn in 1980 to $3.9bn in 2006.

Food and fuel price rises affect us all but if the world’s poorest are to weather these storms we must continue to choose Fairtrade at every opportunity .

All over the world, tens of millions of people are suffering from increased food and fuel prices. While some of us might feel the pinch of a few more pennies on our supermarket bill, rising food prices have pushed millions of people deeper into poverty. These people include the world’s 450 million smallholder farming households, who cultivate two hectares or less. It was tough being a small scale farmer in a developing country before food and fuel prices started to rise due to degraded land, lack of access to affordable credit and unfair global trade rules. But these new challenges combine to make life very difficult indeed. The soaring cost of fuel increases the costs of transporting produce to markets, makes fertiliser prohibitively expensive and in turn makes food prices higher. In Uganda, some tea growers now spend more than 50% of income on food, up from 30%. Some estimate the price of maize will rise by 27% over the next ten years.

Eggs twice a year

A member of Mabale Growers Tea Factory in western Uganda, Beatrice Kunihira usually produces 300kg of tea a month, but has been unable to afford fertiliser recently and is only producing roughly half as much. On top of this, price rises mean the family is spending double what it was last year on food. She says ‘We can only afford eggs twice a year, at Easter or Christmas. We are in poverty. Sometimes we want to put on shoes but we can’t afford them. Sometimes, we want to eat meat, but we can’t afford it.’

Stability and security

However, the situation for Fairtrade coffee farmers in the same part of Uganda is different. Most members of Ankole Coffee Producers Cooperative Union are subsistence farmers, self sufficient in food. Sometimes they are even able to sell a surplus into the market, and so benefit from the higher food prices. The Fairtrade price they get for their coffee means relatively speaking, they are prospering. It’s the guaranteed Fairtrade minimum price that has given them the security to deal with this uncertain period. Coffee prices are notoriously volatile, making planning ahead difficult for growers. John Nuwugaba, chair of the Union, explains ‘Fairtrade gives us a guaranteed price whatever happens. This means more consistent income. Farmers can conduct their business better by planning ahead.’ Although Fairtrade was conceived in response to low commodity prices, it is just as vital now in this time of high food prices, because it provides producers with more stability in a constantly fluctuating market, allowing them to plan for the future. At the heart of the Fairtrade model are the producer cooperatives and organisations, which increase collective power and reduce costs at times of high commodity prices. The Fairtrade premium too, is vital in unpredictable times, allowing communities to continue investing in development projects or improving their businesses. It can be used to fund projects to address food security or improve production so Fairtrade farmers can benefit from higher commodity prices.

Food and fuel price rises affect us all but if the world’s poorest are to weather these storms, we must continue to choose Fairtrade at every opportunity, and speak out in support of change to the way international trade is done. We must urge governments and international donors to refocus support on agriculture in these tough times, putting small scale farming at the heart of their policies, because after all, one third of humanity depends on it.

Action

 © Spring 2009 Fair Comment