Fair trade in Germany left the niche market. Power shifts observed in global fair trade value chains

Abstract

Fair trade is a fast growing niche market in Europe. Producer and consumer are linked via global value chains, based on the idea of solidarity manifested in a variety of social, economic and increasingly ecological criteria. In the German market, double-digit percentage growth is achieved by augmenting quality and diversity of fair trade products and selling sealed products via supermarkets and discounters. In consequence, the global value chains are subject to change; new actors not belonging to the social movement are getting involved. New steps of value creation are being inserted into existing value chains or shifted along the value chain, primarily into the consumer’s country. As a consequence, power shifts south to north are observed. This aspect leads to the question whether the fair-trade-movement is still changing the conventional world trade system from within or if it is selling its reputation as a price for growth by cooperating with the market actors it is criticising. In this article the results of a study are presented, focusing on value chains of fair trade food products on the German market and their changes over time, on the upcoming of various new highly processed composite goods and on the new possibility for manufacturers and discounters to certify their in-house brand products.