The Economics of Fair Trade Cotton

Fair Trade is an initiative that aims to improve the living conditions of producers in developing nations. The combined social and environmental costs of Fairtrade cotton farming are five times lower than that of conventional farming, according to a study in India, one of the world’s largest producers of cotton. Data showed that the impacts of Fairtrade farming were 97 per cent lower for social elements and 31 per cent lower for environmental components studied.

The Fair Trade label that is displayed on certified products informs consumers that the product was produced in a socially and environmentally responsible manner. The new research by Fairtrade aimed to provide fashion brands with a useful new tool to enhance visibility of their cotton sourcing and deepen understanding of their social and environmental responsibilities. Fairtrade said that apparel brands that rely on cotton now have a real opportunity to make informed strategic decisions that will help create a more resilient business and be more accountable for their environmental and social impacts.
The study measured the environmental and social impacts on rural households in India.

The most significant social advantage for Fairtrade farmers was more income. The research compared community benefits from Fairtrade premiums, wages, income for farmers, engagement of unacceptable labour practices, such as child labour and social cost of overtime. It revealed that Fairtrade cotton farmers tend to have lower social costs and higher social benefits such as fairer wages and investment in local schools.

Fairtrade cotton performed significantly better than conventional cotton for all environmental KPIs. Areas surveyed included land use, water pollutants, water use, green house gas emissions and soil pollutants. It was only for land use where Fairtrade cotton’s cost was a little high as the yield for organic practices for cotton per acre is lower than conventional.

Subindu Garkhel, cotton manager at the Fairtrade Foundation said: “Cotton is an integral part of our lives, from the sheets on our beds to the identity we project through the clothes we wear. Not only that, but cotton also provides livelihoods for millions across the globe.

“But there is a strong cost for people and planet with cultivating the cotton that goes into our clothes, and our study shows that is markedly higher for conventional cotton farming. This research illustrates how Fairtrade empowers farmers to decide their own future, is better for their communities and has a substantially lower footprint than conventional cotton.”

The research revealed that benefits such as the Fairtrade minimum price and the Fairtrade premium are unique to Fairtrade certification, and conventional cotton farming was found to only provide income for farmers based on the local market prices for cotton.

Label Soul Space exemplifies our love for nature and fashion and is made by people who we care for and grown in the fields we nurture with no pesticides and GMO’s. Soul Space is tirelessly narrowing the gap between grassroots and glamour. All Soul Space apparel is sweatshop free, ethically produced, and part of a movement transforming the way apparel is made.

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