THE BASICS OF FAIR TRADE PRICING

In October the price a tapper in Thailand received for a kg of DRC (Dry Rubber Content) was THB 33-34 – approx. EUR 1.00. In March it had been THB 47 (at the time approx. EUR 1.30).  A former president of the Thai Latex Association calculated that the price should be THB 60/kg in order to reach the Thai minimum wage. The Fair Trade premium per kg/DRC is EUR 0.50/kg = THB 16.79. In Indonesia the ex farm gate price in October was approx. EUR 0.72 for 1 kg of rubber. According to the general secretary of the Rubber Association of Indonesia a tapper earns on average at present EUR 3.90 per day  – while the legal minimum wage is EUR 7.57/day – almost double the current tapper wage. Tappers in Indonesia, when asked what a ‘fair price’ would be, came up with a more modest figure and a far simpler formula: The price for 1 kg of tapped rubber (‘wet’ rubber) should allow them to buy 1 kg of rice – at present IDR 8-9,000/kg.  If they are lucky, at present they get IDR 5,600 per kg ‘wet’ rubber.  A lot of well known companies from car and tyre makers to shoe brands have recently signed a pledge to switch to Forest Stewardship Council (FSC) certified rubber – once it is available.