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Supply of fair trade cotton to increase

Retailers in search of fair trade cotton could see a significant increase in its availability, after the Fairtrade Labelling Organisation [FLO] revealed a sevenfold increase in the number of countries with access to accreditation.

However, FLO, which accr-edits cotton farmers with the Fairtrade label, will implement new regional minimum prices for Fairtrade-certified cotton – including organic and conventional seed cotton – on July 1.

The new prices represent an average increase of 24% per kilo and are set by geographical region rather than by country. The new price range will be from 28p to 44p per kilo.

Until now, only cotton farmers in nine countries could access certification but under the new regime, cotton farmers from 76 countries can apply to be certified. The news will be welcomed by retailers looking to increase their orders of fair trade cotton, for which demand has always outstripped supply.

A spokeswoman for Marks & Spencer said: “We’re encouraged by the increase in the number of countries with access to Fairtrade certification.”

Sales of products made from fair trade cotton jumped from half a million units to 9.5 million in 2007. M&S estimated that 4% of all the cotton it used during its 2007/08 financial year was Fairtrade-certified, but the retailer is aiming to take the figure to 10% by 2012 – the equivalent of 20 million garments.

However, it is unclear how the new minimum pricing will impact on retailer margins and selling prices. A spokeswoman for FLO said that without the minimum price, farmers would have little bargaining power. “We’ve introduced these prices after talking to importers, exporters and farmers, to ensure farmers get a fair price.”

In the new system, there are six regional Fairtrade-certified minimum prices, relating to: central and South America; northern Africa; eastern Africa; western and central Africa; south Asia; and Kyrgyzstan. Part of FLO’s consideration was to avoid price competition between countries of the same region.

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