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Making Room for Smallholder Cooperatives in Tanzanian Tea Production: Can Fairtrade Do That?

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Abstract

The objective of this article is to examine the different ways that smallholders are brought into Fairtrade certification schemes in the Tanzanian tea industry. We examine the different ownership relations of processing factories and the perceived benefits of these different arrangements. We use descriptive qualitative analysis based on qualitative interviews and focus groups conducted between 2008 and 2010 to identify the significance between factory ownership organization and Fairtrade certification. We find that there is a movement toward innovation in the organizational strategies, which includes new ownership arrangements of processing factories and outgrower contracts that have been associated with certified Fairtrade production. We also suggest that organizational innovation is significant for obtaining scheme success yet perceived benefits of and increased information about Fairtrade production is independent from ownership shares in processing.

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Notes

  1. We differentiate between Fairtrade and fair trade throughout this article. Fairtrade refers to the standard and organizations affiliated with the Fairtrade Labelling Organizations International (FLO), while fair trade refers to the concept and other groups not associated with FLO.

  2. Made tea is the technical term for the processed tea that is the final product of the tea processing factory. It refers to tea that has been “made” drinkable (i.e., steamed and dried for green tea, and oxidized and dried for black tea).

  3. The third main tea producing and processing region in Tanzania is found in Bukoba district in the Kagera region, but was not included in this study because it is not part of the Fairtrade certified production.

  4. The Fairtrade tea standard and statistics cover black, green, white, and oolong tea, they also include herbal infusions (i.e., chamomile, hibiscus, mint), spices, and rooibos tea.

  5. These three complaints were repeated by research participants in Tanzania and Kenya, as well as by buyers in the UK and Germany. Suspicion of collusion at the Mombasa Auction has also been noted by Van der Wal (2008) and by the East African Tea Trade Association in reference to the introduction of an automated auction system (EATTA 2010). The reference to the loss of identity refers to the practice of the export of blended tea by buyers at the auction being labeled as “Kenyan tea” because of the blending that takes place in Mombasa after single estate lines are bought at the auction.

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Acknowledgments

This article is based on work supported by the National Science Foundation under Grant# SES-0924202; and by an Institute of International Education Fulbright Fellowship, funded by the US Department of State. Any opinions, findings, and conclusions or recommendations expressed in this material are the authors’, and do not necessarily reflect the views of the funding agencies. The authors thank Larry Busch, Jim Bingen, the anonymous reviewers and the participants at the International Symposium: Innovation and Sustainable Development in Food & Agriculture (June 28 to July 1, 2010—Montpellier, France) for comments on earlier versions of this article.

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  1. Institut National de la Recherche Agronomique, Science en Société (INRA-SenS), Institut Francilien Recherche Innovation en Société (IFRIS), Université Paris-Est Marne La Vallée, Bois de l’Etang, 5, Bd Descartes, Champs sur Marne, 77454, Marne-la-Vallée Cedex 2, France

    Allison Marie Loconto

  2. Tea Research Institute of Tanzania, P.O. Box 2177, Dar es Salaam, Tanzania

    Emmanuel Frank Simbua

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  1. Allison Marie Loconto
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Correspondence to Allison Marie Loconto.

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Loconto, A.M., Simbua, E.F. Making Room for Smallholder Cooperatives in Tanzanian Tea Production: Can Fairtrade Do That?. J Bus Ethics 108, 451–465 (2012). https://doi.org/10.1007/s10551-011-1101-9

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