WASHINGTON, USA – Fairtrade America, the U.S. branch of globally recognized and trusted ethical certification, Fairtrade International, today released a forecast of opportunities and challenges likely to influence the food and beverage sectors in 2024.
Fairtrade expects sustainable and ethical sourcing, brand transparency and accountability, private label brand growth, the continued rise of ‘regenerative’, and investment in living incomes and wages to be major drivers of shoppers’ and businesses decisions over the next year.
“Shoppers are ready to make sustainable choices, but meaningful, lasting change won’t happen through their individual actions alone. Businesses, governments and other industry leaders must step up when it comes to creating a viable future for farmers and workers around the world,” said Amanda Archila, Executive Director of Fairtrade America. “Sustainable, eco-friendly, regenerative, ethically sourced – these buzzwords have to be embodied by principles backed up by rigorous due diligence across an entire organization to really mean something.”
Drawing on new consumer research and learnings from the organization’s work with thousands of brands and retailers globally, Fairtrade America predicts the following trends in 2024:
Products and brands that commit to sustainability with integrity will outperform their competitors.
Sustainability claims are nearly ubiquitous in the consumer-packaged goods landscape – Fairtrade’s 2023 consumer research, conducted by independent insights firm GlobeScan, revealed that 86% of US shoppers recalled seeing some sustainability or ethical sourcing label on products as they shopped. What’s more, sustainable products are driving growth. The latest data from the NYU Stern Center for Sustainable Business show that, while representing just one-fifth of the total CPG market, sustainability-marketed products were responsible for one-third of market growth, and these products grew about two times faster than their conventionally marketed counterparts.
But with so many brands making promises about their product’s ethical or environmental impact, consumers are growing increasingly skeptical and discerning. Data released in September from Nielsen NIQ says that 77% of consumers would stop buying from a brand that was guilty of “greenwashing,” and new research from Sustainable Brands reveals that are suspicious of environmental and social marketing messages. U.S. regulatory bodies are also cracking down to prevent misleading claims: the SEC has implemented new rules to restrict misleading investment portfolio names, and the Federal Trade Commission will release its updated “Green Guides” in 2024 to provide updated standards for sustainability claims in marketing.
Promising positive impact won’t be enough in 2024 – brands will need to show shoppers that they’re walking the walk. It will be important for businesses to invest in trusted third party supply chain certifications, like Fairtrade, as a step toward verifiable and meaningful sustainability that consumers recognize and trust.
‘Regenerative’ will be the leading buzzword, but the industry must define what this means.
Attendees of industry events in the last two years will know that regenerative agriculture has been steadily commanding more attention in the sustainability dialogue. Leading players like Whole Foods Market have begun to institutionalize these sustainability practices by requiring third party certification or proof of regenerative claims on product labels.
For all its popularity, however, there is no clear consensus on what ‘regenerative’ really means. In 2024, businesses, producers and retailers will face the task of defining and implementing this buzzword. As with other sustainability initiatives and claims, this needs to be farmer-led and centered on principles, not just specific regenerative production practices. Fairtrade’s sustainable agriculture policy, released this year, presents a path forward with an agroecological approach that meets farmers where they and their farming operations are, ultimately aiming to not just redesign agriculture, but entire food systems.
Transparency and data integrity will no longer be optional – shoppers and governments want measurable impact from businesses.
In the last few years, the operations of large companies have been increasingly scrutinized for their effects on the planet and the people they employ. As anti-deforestation regulations near full implementation in the EU, companies tapping into global supply chains of products like cocoa and coffee are reckoning with the monitoring and reporting infrastructures required for compliance. In the U.S., California’s new Climate Corporate Data Accountability Act signals a wave of similar climate-focused regulations for large American companies in the coming years.
Brands who lean into these shifts by assessing and developing measurable roadmaps to address their own human rights and environmental risks will be well-situated to succeed once accountability is a need-to-have here at home.
Additionally, shoppers are demonstrating a growing desire to understand exactly what goes into the products they use and consume. In Fairtrade’s 2023 consumer insights research, 92% of shoppers surveyed said that they are interested in knowing more about the people behind their food. In 2024, supply chain transparency and third-party verifications of sourcing and production promises will move from leading edge to table stakes.
Businesses and shoppers will prioritize living incomes and living wages.
Globally recognized brands like Ben & Jerry’s, Lidl and Tony’s Chocolonely have been pioneering partners of Fairtrade on the path to living incomes for cocoa farmers. Fairtrade expects to see a greater focus on this critical lever to improve farmer livelihoods across a number of commodities and industries in 2024.
Already in 2023, the Fairtrade Minimum Price for coffee shifted in favor of farmers’ needs and new Living Income Reference Prices are being developed for various coffee-producing regions. wages, Fairtrade has launched new initiatives to support banana farm workers in achieving living wages.
Terms like “living income” and “living wage” are becoming more mainstream in the U.S. in light of recent economic uncertainty and rising prices. Beyond the U.S., millions of smallholder farmers are speaking up about the challenges of unsustainable livelihoods, and there’s increasing pressure for businesses to collaborate in the name of industry-wide change. In 2024, businesses will need to demonstrate commitment and impact to sustainable livelihoods through long-term and farmer-approved financial partnerships.
Private label brands will continue growth as preferred choices for consumers seeking more affordable premium products.
Long thought of as simply a budget-friendly option, many private label brands today symbolize a “premium” or preferred line that consumers value for more than price. Target, for example, recently touted its Good & Gather brand as a “crown jewel” of its grocery business. There’s opportunity for both retailers and manufacturers to capitalize on shoppers’ shifted perspectives on these brands in 2024.
For retailers, meeting shoppers’ sustainability values, in addition to price expectations, is the next frontier of growth for private label and could be a key that unlocks broader store success. Fairtrade’s 2023 consumer research showed that two in three consumers familiar with Fairtrade prefer to shop at retailers that they know carry certified products. They’d also purchase more Fairtrade products if they were available where they shop.
For brands, offering those “extras” in value beyond price is the next evolution to stand out to customers. Retailers will likely emphasize sustainability in their product selection as they strive to meet shoppers’ expectations.
“We’re encouraged by the momentum toward value chains that actually live up to their promises of positive impact,” continued Archila. “We at Fairtrade are ready to help businesses in understanding, implementing and talking about their partnerships with the people behind our most beloved products.”