Tate & Lyle goes Fairtrade in 'biggest switch' by UK firm

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Tate & Lyle, Britain's second-biggest sugar company, is to convert its entire retail sugar range to Fairtrade by the end of next year.

The move, which will benefit 6,000 smallholders in Belize, will increase sales of Fairtrade sugar more than tenfold – from £4m to £60m – and raise total Fairtrade sales by around 10 per cent. Tate & Lyle, which has 21 per cent of the retail sugar market, said it had been discussing the move with the UK-based Fairtrade Foundation for two years.

Its decision is another fillip for Fairtrade following the Co-op's support of Fairtrade chocolate, Sainsbury's stocking of Fairtrade bananas and Marks & Spencer's backing for Fairtrade tea and coffee.

"This is the biggest ever Fairtrade switch by a UK company," said Harriet Lamb, director of the UK Fairtrade Foundation.

Under the terms of Fairtrade, farmers receive a guaranteed price for their commodity above the world market rate, as well as a social premium to be used in their communities.

Tate & Lyle expects to pay farmers an extra £2m in the first year of the scheme. Its white granulated sugar will be its first product to be converted, followed by 22 more. The premiums will go to the Belize Sugar Cane Farmers' Association. "These communities have been hit by higher input prices, changes in the EU market, not to mention challenges thrown up by natural disasters such as last year's Hurricane Dean," said Steven Hermiston, a Tate & Lyle spokesman.

The sugar decision could not have come at a better time, according to George Gelber, head of policy at Cafod, the Catholic Agency for Overseas Development. "With changes in EU trade rules, small farmers will increasingly find themselves [up against] some of the world's most efficient producers. It is now up to us to choose Fairtrade whenever we buy sugar."

Sales of Fairtrade certified products have been growing at around 40 per cent a year and topped £290m in 2006.