Trade & Fair Trade Flashcards
Define fair trade
When producers/farmers in LEDCs are paid a fair market price for products
Where is coffee grown ? (3)
Brazil, Kenya & India
Explain the distribution of coffee
Shipping companies - 10% Transport & coffee exporters - 10% Food company - 45% Coffee growers - 10% Shop owners - 25%
Why is there such large supplies of coffee?
The world bank and other bodies have encouraged LEDCs to grow more coffee so they have more in storage (oversupply)
Who decides the price for coffee beans?
The buyers decide on the price because there is so much coffee on the market e.g Nestlé
How does the unfair prices impact producers?
They don’t know how much they could earn for every kilo of coffee (it may be underpriced).
LEDCs are known to produce more ….
raw materials
Why are trading sales balanced against LEDCs?
Primary products are low in value and subject to fluctuating prices
Name three characteristics of fair trade
- Creates opportunities for economically disadvantaged producers
- Creates a health working environment for producers
- Fair trade encourages better environmental practises
Name two characteristics of fair trade products
- Usually more expensive
- Maximise the use of raw materials from managed sources in their area
Name two benefits of fair trade to the farmer
- Farmers receive a Fairtrade Premium which helps to improve their quality of their lives via education, healthcare and farm improvements
- Farmers are involved in Partnerships which influence prices, premiums and overall strategy
Name three coffee consuming countries
Finland
Norway
Netherlands
