Poverty – why it can be eradicated

For most of humanity’s existence on this planet poverty was an inevitable situation. There simply was not enough food and resources relative to the world’s population, especially when bad harvests struck. But that is no longer the case. Given the huge leaps in productivity seen in the last century humanity produces more than enough food and basic goods to supply every human on the planet with their basic requirements. This is a fundamental change, as scarcity is no longer the issue. Distribution is now the issue. That is why Fairtrade is such a powerful tool in fighting poverty. Many of the world’s poor are smallhold farmers, and the urban poor are often farmers that have migrated to cities in search of a better life. The simple philosophy of Fairtrade is that if the value chain within any product was more equitably distributed, then those at the bottom of the chain could be ensured a basic but decent standard of living. Lets take a concrete example: you can buy 1kg of Uncle Ben’s Long Grain Rice for £3.96 on the Tesco web site. High quality long grain rice is traded at $400 to $600 a tonne, with the smallhold farmer not getting much more than half of this. That means that the farmer is getting about 20p a kilo, for something you as a consumer are paying £3.96 for, or about 5% of the proceeds. Imagine if they could get even 40p a pack what that would do to their livelyhoods. Free markets can produce some pretty unfair results when the little guy has no negotiating power with the big guys in the chain. That is why Fairtrade guarantees a minimum price that is sufficient to provide a decent quality of life, whatever the actual market price. You probably wouldn’t buy some products if you knew how the people producing them had to live, but supply chains have become so complicated it is pretty hard for the consumer to know anything about this. At Quinola we have taken out the middlemen, buying straight from the cooperative in Cabana and selling directly to the shops. That is how in a 500g pack of Pearl Quinoa that is sold for £3.50 the farmer gets over £1.30 (pretty much the same as what the shop makes). That is 8X more than what the rice farmer will be getting relative to the product price. Another little brick in redistributing the world’s wealth in a more equitable way.