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What is the Fairtrade Premium?

  • 3 min read

The Fairtrade Premium is a sum of money paid on top of the Fairtrade minimum price to producers of Fairtrade goods. The Fairtrade Premium supports producers and their communities by contributing towards training and resources to expand business operations. In addition, the Premium is used to develop education systems within the producers’ communities to work with future generations. 

How does the Fairtrade Premium get spent? 

The Fairtrade Premium is paid directly to the communities involved. Within these communities, an elected representative is selected to decide how this contribution will be best spent. The Fairtrade Foundation believes in empowering the communities that it stands with to make their own decisions on where the money is spent and the farmers and workers are in a first-hand position to agree where the money goes: they know what resources, skills and materials will improve and expand their business.

Where does the Fairtrade Premium money go?

By choosing to buy Fairtrade coffee beans, your purchase not only pays coffee-farmers a fair minimum price, it also contributes towards the Fairtrade Premium funds that are distributed amongst global coffee-farming communities. 

Fairtrade logo on coffee cup with Fairtrade farmer holding and smiling

Contributing to UN Sustainable Development Goals

The UN have committed to 17 Sustainable Development Goals (SDGs). Purchasing Fairtrade coffee beans contributes to several of these goals through investments made by coffee producer organisations. 

UN SDG: Zero Hunger 

71 percent of investments have contributed to Zero Hunger. The aim of Zero Hunger is to ‘end hunger, achieve food security and improved nutrition and promote sustainable agriculture. Investments made by coffee farmers which have a positive impact on this goal include the purchase of fertilisers for crops, training to assist communities expand their teams, and improved farming practices. 

UN SDG: No Poverty

20 percent of investments contribute towards the UN’s No Poverty SDG, which aims to ‘end poverty in all its forms everywhere’. This included credit services and direct payments of Fairtrade Premium monies to farmers. 

Other contributions

The remaining 9 percent of investments by coffee farmers under the Fairtrade system contributed to other SDGs, which included ‘Sustainable Cities and Communities’ and ‘Quality Eduction’. 

The difference Fairtrade Premium makes

The Fairtrade Premium provides opportunities for future security for Fairtrade coffee farmers and their communities through diversification. 

The Premium has allowed farmers and workers to expand their businesses and grow products in addition to coffee beans. 

Farmers who grow the coffee that we drink every day face a climate crisis which is leading to coffee plants diseases including ‘La Roya’ and ‘Coffee Borer’. These can kill off a wide spread of a farmer’s harvest. 

Not only has the Fairtrade Premium provided essential funding to help prevent these diseases, it has also allowed the farmers to diversify into growing Sugar Cane and Cocoa beans. 

The Bigger Impact

Choosing to shop for Fairtrade products means supporting women to own their own crops and business through the Fairtrade Premium. 

Fairtrade Coffee Cooperative with women coffee farmers in a group

Fairtrade standards empower farmers and workers, irrespective of gender. They also cover provisions designed to prevent gender inequality, discrimmination and sexually intimidating, abusive or exploitative behaviour.  Standards also include the democratic decision-making process in which women have a say within their communities and means that their voice matters. 

The Fairtrade system has allowed women to be able to own their own land, produce their own crops and be able to control resources. 

Fairtrade increases the annual wages of co-operative farmers and workers by about 160 percent, raises the likelihood of receiving at least the minimum wage by 59 percent and reduces the likelihood of living below the poverty line by 35 percent.

Shop locally, impact globally

We would like to thank all of our customers for choosing to shop locally with Owens. By shopping locally through our small family business based in the South West of Britain, and buying our Fairtrade products, you have chosen to support a huge global effort, at a time when the connection between us all as a worldwide community has been highlighted more than at perhaps any other time in recent history. 

By choosing to shop Fairtrade, you are choosing/voting for the world you want to see. We truly hope that you all can see how much of a global impact you make. 

The Fairtrade Premium is just one of the reasons why you should choose Fairtrade. To find out more about why to buy Fairtrade products, click here



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