Living Income SmartCheck

Living incomes are the amounts that a typical farming family needs to earn from their crop sales to support themselves. Living incomes form the basis for any sustainable supply chain. Fairtrade International has developed reference prices for various crops, including cocoa, coffee, coconut, cashew, mango, orange, and rice. FLOCERT is pleased to provide verification services for committed commercial partners who pay a Living Income in their supply chains. We ensure that additional payments reach the farmer organisation, are fairly distributed, and contribute to improving farmers’ lives.

For a personalised offer, contact us at solutions@flocert.net

In a nutshell

Everyone who works deserves fair compensation to ensure a dignified life for themselves and their families. Today, many farmers and farming communities continue to live below the poverty line and cannot afford a decent livelihood.

To address this issue, Fairtrade provides Living Income Reference Prices (LIRPs) for committed commercial partners who aim to lead their industries in sustainable trading practices. Fairtrade International carefully estimates, curates, and verifies LIRPs for various products and supply chains.

Through the Living Income SmartCheck, FLOCERT ensures that the additional payments made by committed partners to meet the LIRP reach farming communities and are fairly distributed among all members. We also offer insights into how these extra payments contribute to improving the lives of farmers.

Already paying a Living Income Reference Price within your Fairtrade supply chain?

If your company is paying the product-specific Living Income Reference Price (LIRP) set by Fairtrade International,

FLOCERT verifies the LIRP claims you would like to make
We check and confirm your LIRP payments reach smallholder farmers
We evaluate audit findings and prepare a final report, including recommendations to improve the LIRP accountability and transparency

Fairtrade's Living Income Strategy

Fairtrade approach

Fairtrade works with committed commercial partners and their suppliers to implement a holistic approach towards living incomes, which includes the voluntary payment of Reference Prices, alongside other components of the living income strategy.

A Living Income Reference Price is based on four key variables:

Sustainable yields: Defined as a realistic target productivity level that can be attained when recommended sustainable agricultural practices are implemented. Feasible yield targets are set by producers and technical experts at origin, considering the local context, conditions and common production practices.
Viable crop area: A full-time farmer should be able to make a living income from farming. Therefore, a viable crop area to depend solely on the revenue of this crop for a livelihood is defined as sufficient land to fully absorb the available adult workforce in a typical household. This means that farmers who have a smaller land size likely need complementary income sources to make a living income.
Cost of sustainable production: The farm investments for implementing sustainable agricultural practices required to meet the target yield are calculated as the production costs. Any hired labour needed after the available household labour is fully deployed is factored in at a living wage.
Living income: Living Income benchmarks are established using the Anker methodology and represent the costs of a decent standard of living for a typical household, including food, shelter and other essential needs.The net farm income should be at least equal to a living income, in case of a viable farm area when sustainable yields are achieved.