Fair Trade vs Direct Trade

Fair Trade vs Direct Trade

It’s currently Fair Trade Fortnight here in Wellington, with some great events and activities happening around the city that will help bring to light the ethics behind some of our favourite commodities. This seems like as good a reason as any to talk about the cacao that is used in the chocolates we stock, and the routes of trade it takes.

It is very common for people visiting our market stall to ask about whether or not our chocolate is fair trade. My answer is always the same, which is that our chocolate is fair trade as a minimum but that the majority is actually direct trade. This term ‘direct trade’ is new to quite a lot of people, so we thought it would be worth explaining a little bit about the difference. We don’t consider ourselves to be experts, but still wanted to convey what we have learnt so far. Essentially, this is a very complex issue that cannot be simplified into a few hundred words, nor with a single label on a packet.

In certain circles fair trade is a hot topic that can cause some pretty heated debate. There have been some damning reports of fair trade over the past few years, along with some staunch defence of the system and its values. There are many people who believe that the price fair trade guarantees the farmers for their produce is not nearly as high as it should be, and that the label can be used to make westerners feel naively guilt-free about their purchases. There are also some concerns about corruption in the system and money not being fairly distributed to farmers and workers.

From everything we have read, we believe that fair trade is a generally positive and well intentioned organisation. It has improved the lives of thousands of farmers and workers around the world, as well as working tirelessly to bring people’s attention to the morality of what they consume. The very fact that so many people understand the meaning of ‘fair trade’ is a testament to its own success. But there is always more that can be done.

That is where direct trade comes in. Direct trade takes the concept of fair trade to another level and removes the barriers between producers and suppliers. Rather than going through a middleman and the loopholes and bureaucracy of certification schemes, many craft chocolate makers are choosing to go straight to the source and build personal relationships with the cacao farmers, or with small-scale cooperatives who help the farmers to reach international buyers. They are paying above the fair trade rates and the farmers and farm workers receive a much higher income for their work.

direct trade

The benefits of direct trade for the chocolate maker and cacao farmer are manifold, but one of the key areas where this system differs from fair trade is quality. Because the farmers and makers are working together there is an open dialogue between the two about how to get the best quality cacao and what is most desirable for the chocolate maker. In some cases the makers are even helping the farmers to improve things like their fermentation and drying processes, which in turn leads to the farmers being able to charge a higher amount for their cacao beans - there is an incentive to produce more than just large volumes. Visiting chocolate makers can bring a taste of their chocolate to the farmers and show them the differences in the final product. You’d be amazed how many cacao farmers and workers in the world have never tasted chocolate.

One problem that some fair trade advocates have with direct trade is that it is mostly unmonitored and uncertified, although organisations like Direct Cacao are working on that, and in the U.S. Taza Chocolate have created their own direct trade certification scheme in collaboration with USDA. There is a certain element of trust involved but with the kind of companies we work with at The Chocolate Bar it’s easy to build that trust. Our chocolate makers offer complete transparency about where their cacao comes from and in many cases will freely discuss the price they pay for it. All you need to do is a little research, which we would recommend doing about anything you eat these days.

We think the subject of quality is one of the biggest reasons why the direct trade model is more suitable for the bean-to-bar and craft chocolate industry. Fair trade might be good for companies like Whittaker’s and Green & Black’s, who mass produce inexpensive chocolate, but for the type of extremely high quality chocolate that we sell it seems to make sense that there would be a more bespoke and finely tuned trade arrangement. Fair trade treats cacao as a standardised commodity and speaks only in terms of what is a fair price by weight, not by quality or varietal. Although some of the high-end cacao used in our chocolate does come through fair trade organisations such as Trade Aid, we believe that over time we will see more and more of these producers involved in direct trade. It is the best thing for everyone and can lead to higher quality chocolate, which is always the ultimate goal for the craft and bean-to-bar producers. 


If you'd like to learn a little more about direct trade, please check out this article from the guys at Marou. You could also watch this video from Taza Chocolate...


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