* Major brands embrace Fairtrade label
* New olive oil initiative in Palestine
* Consumers stay loyal as economic downturn bites
By Nigel Hunt
LONDON, March 4 (Reuters) - Consumption of products such as cocoa, coffee and bananas under the ethical Fairtrade label is continuing to rise strongly despite the economic downturn, the head of the Fairtrade Foundation told Reuters.
"We feel very keenly that the farmers need Fairtrade now more than ever. If times are tough for people here in Britain, they are pretty desperate for farmers and workers in developing countries," said Fairtrade chief executive Harriet Lamb.
The consumer label, which covers a wide range of products which also includes sugar and flowers, aims to give a better deal to workers in developing countries.
"I think research shows that where Fairtrade is coming out strongly at these times is that it is about people. They (consumers) have the chance to connect with the farmer who grew the cocoa or the bananas and make a difference in the lives of individuals," Lamb said.
"Perhaps they (consumers) connect even more at these difficult times with other people. We certainly have the sense that the public are staying very loyal," she added.
UK sales of Fairtrade goods reached 700 million pounds ($987.7 million) in 2008, a rise of 43 percent on 2007. Seven in 10 households in Britain purchase Fairtrade goods.
Lamb said developing country farmers were still coping with dramatic increases in prices for fuel and food last year and were now caught in the credit crunch.
"It has become almost impossible for smallholders to get loans from banks. even at ridiculous rates like 30 percent and in some cases sales are falling," she said.
The Fairtrade Foundation certifies Fairtrade products in Britain and is a member of Fairtrade Labelling Organisations International (FLO) which works in about 80 countries.
"The potential is enormous in some, such as the United States, where they is really everything still to play for to begin to reach the levels we have in Britain," Lamb said.
PALESTINIAN OLIVE OIL
Sales in Britain are dominated by bananas, cocoa, coffee, cotton, sugar, tea and flowers but the foundation is expanding into new areas.
"We have just launched Fairtrade certified olive oil from Palestine. That is an exciting new initiative which we hope will provide the economic underpinning for peace," Lamb said.
The ethical label is also entering new consumer markets with products with the Fairtrade mark available for the first time this year in South Africa.
The Fairtrade Foundation also announced this week that confectionery maker Cadbury Plc plans to sell Britain's biggest selling chocolate brand Dairy Milk under the Fairtrade logo in Britain and Ireland.
"Our analysis was until quite recently that what we were missing was some of the power brands. Now we have two iconic British brands saying they are going to put Fairtrade right at the heart of their businesses," Lamb said.
Last year sugar refiner and sweetener maker Tate & Lyle announcing it had begun to switch its retail sugar range to the Fairtrade label.
"There are plenty of very worrying trends for everybody but what I think the research shows is that people are looking for value but not compromising their values," Lamb said. (Reporting by Nigel Hunt; Editing by William Hardy)