During a recent meeting of the All Party Parliamentary Group (APPG ) for Fairtrade, MPs put their concerns to Nestlé that its decision to switch cocoa sourcing from Fairtrade to Rainforest Alliance would put some of the world’s poorest cocoa farmers and workers’ livelihoods at risk, at a time when the coronavirus means they can least afford it.
Nestlé has argued that schemes would be in place to mitigate the impact to cocoa farmers, when it announced its decision, but admitted that sugar farmers would definitely be worse off under its decision to source UK beet sugar instead of sugar cane from overseas.
During the virtual meeting, MPs made it clear that they remained unconvinced by the KitKat maker’s decision to stop sourcing on Fairtrade terms for its iconic brand, over fears that it would result in poorer incomes and conditions for some of the world’s lowest paid, instead urging them to reconsider the move and to remain Fairtrade.
Nestlé has confirmed the move from Fairtrade to Rainforest Alliance accreditation will see Ivorian farmers paid a lower payment for their cocoa, from the Fairtrade Premium of $240 a tonne, to $180 a tonne, on top of the market price.
The confectionery giant suggested in the short term other payments and projects would make up the difference, but Fairtrade said there was a lack of clarity over whether these payments and projects will still leave farmers with less money, and how long they will last beyond the next two years.
In addition to concerns that farmers will be less well off financially, MPs of all parties expressed strong concern over the ability that farmers will have to decide on the use of funds.
Under the Fairtrade system, farmers and their co-operatives have full control over how the $240 Fairtrade Premium is spent. However, Nestlé told MPs that only one third of the new $180 payment will be under the full control of farmers.
The MPs said they believe that farmers should be able to decide how to spend money they have earned from their sales.
Labour MP Holly Lynch, co-chair of the APPG on Fairtrade, said: “Both Nestlé and Fairtrade have benefited from their partnership over the years. We are concerned that Nestle’s decision to stop sourcing Fairtrade cocoa for KitKats will knock consumer confidence in the brand, which we are all keen to avoid.
“British shoppers have grown used to KitKats guaranteeing equity and prosperity for the producers who create the chocolate that we love. We are asking Nestlé to think again, especially given the global economic uncertainty caused by the coronavirus pandemic.
"At the very least, we would like to see Nestlé delay this process to safeguard the producers who have been integral to the company’s long-term success.”
MPs also questioned the depth of the consultation process that Nestlé ran with cocoa farmers before announcing their decision and the APPG plans to make further calls on the company to share a full multi-year financial breakdown allowing the detail to be properly understood, as well as greater clarity over the decision making powers that farmers and co-operatives will have under the proposed move.