Fair Trade USA has been an important partner to retailers, private brands and consumer brands in sustainable production since 1998. The organization’s roots are in the coffee space, when Paul Rice, the eventual founder of the organization, spent 11 years in Nicaragua working with coffee farmers to sell coffee on fair trade terms. Over that span, he ended up working with more than 3,000 families, enabling coffee farmers to invest in homes, electricity and running water through fair trade practices. He returned to the United States and launched Fair Trade USA.
The organization has expanded into areas beyond coffee since then, including a first program within dairy. Molly Renaldo, who worked directly on this program, is sitting on the dairy panel at the Store Brands Industry Forum on Beverages on Sept. 29.
Companies made major strides in transparency beyond the Sustainable Coffee Challenge as well. CVS became the first-ever drugstore to carry 100% Fair Trade Certified products in its exclusive store brand. Gold Emblem, the retailer’s exclusive grocery brand, now offers nine Fair Trade Certified coffee products in a variety of blends and roasts. They have spent the last six months celebrating this with customers in store with signage, promotions and even shippers.
SB: I know Molly will address this more during the Store Brands Industry Forum on Beverages but briefly describe the new program with Chobani.
AA: Fair Trade USA and Chobani have launched a groundbreaking certification program for U.S. dairy farms and cooperatives that provides financial premiums to dairy farmers and workers, which will help protect and empower them while raising sustainability standards.
The announcement is an outgrowth of Fair Trade USA’s partnership with Chobani, which announced its Milk Matters program in 2019 to further its commitment to support economic, environmental and social standards throughout the company’s milk supply chain. The fair trade certification program is available to milk producers throughout the U.S.
Fair Trade Certification provides farm owners and cooperatives with an opportunity to differentiate, increase engagement with consumers and receive a financial premium for their investments. Certification also provides greater support for farm workers in an industry that can face challenges in workforce availability, working hours and farm safety. An immigrant workforce, which makes up an estimated half of the U.S. dairy workforce and is especially vulnerable to these issues because of limited legal protections, will also benefit from Fair Trade USA’s new dairy program. In collaboration with experts and organizations already working in the space, Fair Trade USA plans to develop an environmental component to this program which will address the unique challenges of the dairy industry.
SB: And how can private brands address get involved in this segment?
AA: The dairy program is now open to all private brands in this space. Fair Trade USA certifies raw milk at the source and can therefore be a certification for fluid milk or any value-added dairy based product. The program is open to all supply chain structures, from cooperative to direct, organic or conventional.
Private brands can join this innovative initiative by contacting Fair Trade USA to start scoping the impact for farmers and workers in their supply chains. Together we can understand your market goals and current structure to start the conversation with your suppliers and manufacturers.
SB: What beverage categories could use more private brand involvement, and what are the challenges holding back retailers?
AA: Beverage was the second fastest growing category (behind frozen foods), gaining over 10%, year over year. Retailers have really stepped up to the challenge of supporting the industry-wide initiative to make coffee the first 100% sustainable commodity — converting their pods, instant and bagged lines. There is still an opportunity in coffee for refrigerated and RTD. Other sub-categories we are seeing big gains in beverage, according to IRI, are cocktail mixes, energy, sports drinks, carbonated soft drinks and refrigerated juice — all that could use Fair Trade Certified Cane Sugar.
Some challenges with these sub-categories tend to be they are often on pricing programs, making it hard to compete with national brands and they are competing with brands with strong brand awareness and following. As retailers continue to consolidate SKUs to offer the most productive items and reduce assortment, it will be important for retailers to find ways to differentiate from their national brand competitors and to get in front of more customers. Fair Trade is a great way to kill both of those birds with one stone.