Fairtrade labelling is a movement to allow consumers to identify goods (especially agricultural products such as coffee) which meet agreed standards of fairness. The first labelling system was created by the Dutch charity Max Havelaar in the late 1980s.
Standards are set by national bodies (such as the Fairtrade Foundation in the UK) for each type of product. Typically standards cover labour standards, environmental standards, and stable pricing. A common feature is for standards to set a long-term minimum price (which may be considerably above the market rate) based on the incomes needed to sustain the small farmers products should be sourced from (often via co-operatives). They may include an additional "social premium" above the market price designed specifically to support community projects such as schools. Products that are certified to meet the standard may for a fee display the appropriate Fairtrade symbol on their packaging. (The fee supports the work of the national monitoring body.) Although originally each country had its own Fairtrade symbol, an international standard has been agreed which is slowly being adopted.
There are currently national certification and standards bodies in 19 countries, as well as an international organisation (Fairtrade Labelling Organization) to coordinate policy. The countries with highest spending per capita on Fairtrade-labelled goods are Switzerland and the Netherlands. Global sales are expected to reach $1bn by 2007. In the UK, the most significant single Fairtrade product is coffee, where Fairtrade brands have 18% of the roast and ground coffee market and 3% of all coffee sales.
In 2004 there were around 400 certified producer organisations representing 800,000 families in 45 countries, and over 550 companies licencing the Fairtrade label.