Multi-million Dollar Fairtrade System in Belize; Fairtrade or Unfair Trade?
Every year, millions of dollars are pumped into the sugar industry in Belize, through Fairtrade premiums. A premium is a calculated sum added to an ordinary price or charge. In the sugar industry, Fairtrade premiums act as an incentive to producers in developing countries that adhere to Fairtrade standards in the production of their sugarcane. But, of the four associations in the north, the B.S.C.F.A. has not received Fairtrade premiums for the past two years. This has forced the Government of Belize to implement a number of interventions. But how fair has the decision been from all parties involved? News Five’s Paul Lopez takes a closer look in tonight’s Five Point Breakdown.
Paul Lopez, Reporting
Sugar is the lifeblood of northern Belize. The industry is built on the backs of hardworking cane farmers like Manolo Hernandez. His family’s livelihood, for several generations, has been the production of sugarcane.
Manolo Hernandez
Manolo Hernandez, Sugarcane Farmer
“We grew up together with my dad. He has been a cane farmer since I knew myself. I went to Belize School of Agriculture in 1981 and I decided to just farm. My dad had all this land here so I decided to just work the land.”
What is Fairtrade?
Fairtrade International works with farmers and laborers of more than three hundred commodities, including sugar, to ensure that they earn a living income. The Belize Sugarcane Farmers Association is Fairtrade Certified. In meeting these requirements, caneros earn the right to have their products sold at a premium price on the shelves. Javier Keme is the Chairman of B.S.C.F.A.’s Fairtrade Compliance Committee.
Javier Keme
Javier Keme, Chairman, B.S.C.F.A. Fairtrade Compliance Committee
“The premium is paid by the end consumer of any product. In our case it for any packaged sugar that is sold on the shelf in any grocery store in the market.”
How Are Fairtrade Premiums Distributed and Spent?
Sugarcane farmers, like Manolo Hernandez, deliver produce to Belize Sugar Industries Limited. B.S.I. then mills sugar using a certified process. The Fairtrade eligible product is then sold on the export market to several buyers, including Tate & Lyle Sugars, a UK-based company that sells Fairtrade eligible products at a premium. Olivia Avilez, the Cane Farmer Relations Manager at B.S.I., further explains.
Olivia Avilez
Olivia Avilez, Cane Farmer Relations Manager, Belize Sugar Industries Limited
“We have a contract with the associations on cane purchase. That is not to be confused with the premium contracts. From the understanding Tate & Lyle has an agreement with the small producers directly. That agreement then entitles that small producer organization to then collect premium after the sugar has been sold as Fairtrade sugar.”
Tate & Lyle enters into an agreement with each Fairtrade certified association, informing them of the amount of sugar that they intend to sell under the Fairtrade logo. Tate & Lyle distributes roughly five million dollars in Fairtrade premiums annually that is shared across all four associations. Fairtrade ensures that the funds are put to good use through social, environmental and economic programs.
Vlademir Puck
Vlademir Puck, Chairman, Corozal Sugarcane Producers Association
“We have been benefiting them through various programs. The cane cutters received safety materials. Our cane farmers, we have been giving those services for plowing and husbandry for their cane fields which is something that thanks to that Fairtrade Premium we have been giving them.”
Cosme Hernandez
Cosme Hernandez, General Manager, Progressive Sugarcane Farmers Association
“We focus most on diversification projects, because we know that most farmers can’t live only on sugarcane farming. So, currently progressive is focusing itself on promoting sustainability, food sustainability by doing projects under diversification.”
For B.S.C.F.A., all of those premiums came to a screeching halt when its relationship with Tate & Lyle went sour at the start of the 2021-2022 crop season.
Why Has B.S.C.F.A. Not Been Receiving Fairtrade Premiums?
TLS wrote to the association noting that its values no longer align. This decision has placed significant constraints on B.S.C.F.A.’s finances. Those restrictions are taking a toll on farmers.
Manolo Hernandez
“This year I have seen a big decrease in my yield, from four thousand to about three thousand, almost a thousand tons, almost over a thousand tons. Even a sack of fertilizer went up a hundred dollars a sack. You could put a hundred sack of fertilizer, ten thousand. I put almost three hundred sacks of fertilizer.”
The Government of Belize has stepped in to provide a million dollars to the association for the purchase of fertilizer. Government’s concern is for the sustainability of the industry. Jose Abelardo Mai, the Minister of Agriculture, is also a sugarcane farmer with B.S.C.F.A.
Jose Abelardo Mai
Jose Abelardo Mai, Minister of Agriculture
“By not being able to apply fertilize the way it should be, that has contributed significantly to the reduction of yields. The most affected by this is B.S.C.F.A.”
Is BSCFA Being Treated Unfairly?
Keme questions Tate & Lyle’s decision to choose which Fairtrade certified association in Belize it will enter into an agreement with and which one it will refuse.
Javier Keme
“I want to make this categorically clear, the buyer cannot say I want to buy x amount of sugar from one association. Why, because the sugar that is produced, each association has a portion according to their production on that volume. So that forty thousand tons is not only for BSCFA, it is for the four associations. That is why we claim it is unreasonable and unfair that because there is an absence of the letter of enhancement that we don’t get our premium.”
Tate & Lyle Sugars did not want to go on record with a response, because it is still engaged in discussions with B.S.C.F.A. in an attempt reach common grounds.
G.O.B.’s Legislative Intervention for the Payment of Fairtrade Premiums
The Government of Belize has implemented the Sugar Industry (License to Import/Export Sugar) Regulations 2023. With this legislation, as a precondition to receiving an export license, B.S.I. will be obligated to disclose to the Sugar Industry Control Board how much sugar it has sold, to which buyers, and at what cost, on a quarterly basis.
Jose Abelardo Mai
“I believe that if you don’t give me a letter you then cannot sell my sugar at Fairtrade. You have to separate sugar from the associations and market it separately from the associations. If you do sell it you have to disclose it by law. So, it forces them to be in a position where they have to disclose. All this regulation is asking for is for disclosure. This regulation now, puts more, it forces them to implement Fairtrade as fair trade.”
Olivia Avilez
“At the end of the day what is required is a good relationship between the buyer and small producer.”
Reporting for News Five, I am Paul Lopez.
