A growing commitment to change in the industry - Banana Trade News Bulletin April 2018

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No. 58 | April 2018
The consensus of the successful third conference of the World Banana Forum last November was that change is needed if the banana industry is to survive and thrive. In reflecting this, we look in this edition of the Bulletin at initiatives to move beyond monoculture production, and the contribution of small scale producers in developing ethical and sustainable production models. Although there are challenges for small producers too, as we hear from the Windward Islands about their struggles simply to survive. 
 
We also have news of progress on Tesco's commitment on paying a living wage to banana workers on plantations exclusively supplying the UK retailer. 
 
We hope you find this bulletin as informative and thought provoking as usual. 
 
Alistair Smith
Banana Link International Co-ordinator
 

BEYOND MONOCULTURE – THE FIRST STEPS

Alistair Smith reports on ground-breaking moves to change banana production systems.
 
Following our appeal last November for banana industry stakeholders to look beyond monoculture production systems, we are delighted to report that the appeal was indeed heard and the ‘taboo’ around this subject has been broken once and for all. At the third global conference of the World Banana Forum, a major fruit producer and trader made an announcement of their company’s shift towards replacing Cavendish monoculture production with diversified agroecological systems.
 
Another major player is in the process of trying to set up an association of the major banana companies to generate a collective fund for innovation in this area too, announcing that all future progress in this domain would be shared freely with the international banana community.
 
Several leading banana scientists present at the conference also made clear that the future of the international trade could only be envisioned if such a transition were to take place. There is now, for the first time, a real momentum for change which Banana Link is delighted to encourage.
 
In February, along with leading practitioner of social sculpture, Shelley Sacks of Oxford Brookes University, Banana Link convened a round table brainstorming session with representatives of small producers from the Caribbean, plantation workers from Latin America, fairtrade bodies and companies producing and importing bananas on the theme of "Beyond monoculture". 
 
 
The discussions took place in the Dutch colonial history museum in Haarlem around more than 10,000 dried banana skins from fruit produced by 20 small banana growers from the Caribbean island of Saint Lucia. The Exchange Values installation by Shelley Sacks (pictured above) has been a source of inspiration for over 20 years of discussions with the general public and professionals in 13 venues around the world : see http://exchange-values.org 
 
Participants judged the time to be ripe to lead a wider discussion with players across the global industry on how to move beyond the current system of production which has become so dependent on high levels of agrochemical inputs. Exploring the performance of different varieties, inter-cropping, livestock and agroforestry are all part of the thinking going into the design of modern agroecological systems. 
 
The group decided that promoting industry and public awareness will be essential to facilitating the transition to resilient and sustainable systems. We are planning an event in early 2019.
 
If you are interested in joining the group which is meeting on a regular basis to plan the strategy to promote this transition, please contact Alistair Smith at Banana Link : blink2005@orange.fr

EQUAL EXCHANGE BANANAS: SMALL FARMERS, BIG CHANGE

Ravdeep Jaidka, responsible for Producer Relations at Equal Exchange Bananas in the USA, shares the company’s vision of why small farmers are vital to their model.
 
There are many tangible pieces to the Equal Exchange model. Organic. Fair Trade. Small Farmers. Cooperatives. While these are all important elements of our holistic approach toward trade, the small farmer piece is critical. First and foremost, the Equal Exchange mission is to give small farmers a place in the global marketplace. This is exactly why our tagline reads Small Farmers. Big Change.
 
Equal Exchange was founded over three decades ago to challenge the traditional trade paradigm, where small farmers had no access to the marketplace and were forced to sell their product to intermediaries or brokers without any negotiating power. Equal Exchange started with coffee from Nicaragua, and has since expanded its model to numerous other products: cocoa, tea, bananas, and avocados. The banana trade began in 2007, currently Equal Exchange bananas comes from three small farmer banana cooperatives in Ecuador and Peru.
 
Why support the 500 million small farmers worldwide and the 1,200 small farmers in Ecuador and Peru that make up the Equal Exchange banana supply chain? In a food system increasingly dominated by corporate consolidation and large plantations, where both companies and farms are getting bigger and bigger, it is becoming challenging for small farmers to compete and survive. While some of these realities have not changed since the inception of Equal Exchange three decades ago, others are making it even harder for small scale farmers to thrive. Given this landscape, it is important to understand the realities of the small farmer model and the benefits that model provides to local economies, communities, and the food system as a whole.
 
Members of the Equal Exchange delegation pose with farmer and staff members of AsoGuabo in El Guabo, Ecuador. (Equal Exchange)
 
Why Small Farmers? Because small farmers transform local economies.
Exporting bananas requires many more players than just the farmer and the buyer. Bananas are harvested and exported 52 weeks of the year, which means every week the process involves hiring harvest crews, ordering packaging materials, making reservations with shipping lines, and filing customs documentation, among other logistics tasks. This means the exporting of bananas creates second tier jobs in the communities where bananas are produced, often in rural areas where jobs are scarce. These jobs span across many disciplines, from farm laborers and agricultural technicians to logistics operators and general managers of farmer cooperatives. Together, these jobs create a thriving agricultural economy where farmers and all other actors in the export process take ownership of their own piece to make the supply chain run like clockwork on a weekly basis.
 
Why Small Farmers? Because small farmers create vibrant communities.
In addition to the local economy, small farmers also have positive impacts on their communities. This is made possible through the fair trade premium earned for each box of Equal Exchange bananas, which give farmers a stake in community development projects. In addition to the price of bananas, the farmer cooperative earns $1 per box as a fair trade premium. One shipping container holds 960 40 lb. boxes, which means an export business of one container per week (the minimum export volume) generates $50,000 over the course of the year in fair trade premiums. That’s significant.
 
At the end of each year, farmers come together at the cooperative’s general assembly to vote on how this money should be used within the community. Farmers and community members put forth proposals and decisions are made collectively on where to allocate the funds. There’s discussion; there’s disagreement; there’s consensus; and that’s democracy.
 
In the last year, Equal Exchange’s banana cooperative partners have elected to use the funding on a variety of projects, based on their communities’ needs. At AsoGuabo cooperative in Ecuador, the 125 farmer members have identified healthcare and education as key gaps within the community. The premium fund pays for a doctor to be present at the cooperative’s office each Friday. Farmers, farm workers, and community members come to the office for a check up. Then, the next Friday, they return to the office to read and interpret their results with the doctor. Not only are community members getting preventative health care, a novel concept in rural Ecuador, they are also becoming educated about their own health. In addition to this project, over the last year AsoGuabo’s premium fund also supported a geriatric care organisation and projects at 13 schools within the community.
 
This is the dynamic process of community development that farmers of each cooperative engage in: identifying the needs of their communities on an annual basis through a democratic and participatory process. It’s the farmers who decide what to spend their money on, which is more powerful than any charity or development dollars.
 
Why Small Farmers? Because small farmers make food about people.
In the small farmer fair trade world, it’s all about relationships. Over the course of Equal Exchange’s banana trade, we have continued to deepen our relationships with producer partners and build relationships between the many unique parts of the supply chain. Last June, we invited Four Seasons (produce distributor and banana ripener in Pennsylvania) and MOM’s Organic Market (independent retail chain in the Northeast) to visit AsoGuabo, a banana cooperative in Ecuador. For over 10 years, these organisations have worked together to bring small farmer bananas to U.S. shelves, without having directly met one another. In Ecuador, Equal Exchange brought the entire supply chain together, from farmer to exporter, to importer, to ripener, to distributor, to store. We came together as partners, sitting at the same table, to discuss our realities and connect the disparate parts of the same supply chain.
 
Of course, my favourite example of relationships in the supply chain comes from my personal experience. Last fall, I spent a month living and working alongside AsoGuabo cooperative in Ecuador. I worked out of the AsoGuabo office and did homestays with 2 out of the 125 farmer members of AsoGuabo. I spent days in the field with Jeccica Ramon (banana farmer and host for my stay), learned about the export logistics process with the cooperative’s employees, and shared an office with farmer members who were serving their two year term as Board of Directors for the cooperative. Yes, I deepened my understanding of the producer end of the banana supply chain, but more importantly, I made lasting friendships that will take me back to Ecuador again and again.
 
Small Farmers in Bananas: Big Questions Ahead
All these examples are only a glimpse into the deep and important ways that small farmers are making big waves in their local communities and economies. Not only are small farmers a model for positive change in their communities, they provide a personal connection to our food in a food system that’s designed to distance farmers from consumers. While the benefits of the small farmer model are slightly more complex to explain than the benefits of growing organically or the benefits of trading fairly, the value that small farmers bring to the supply chain and the food system as a whole is unparalleled. 
 
Decades ago, fair trade started as a movement to challenge the power dynamics in conventional trade relationships and to give small-scale farmers access to the global marketplace. This has always been at the heart of the Equal Exchange mission, whether it’s trading coffee, tea, chocolate, avocados, or bananas. 
 
Now, decades later, fair trade is seeing a boom in produce, including in bananas. At Equal Exchange, the question we often ask ourselves is how can we ensure that small farmers are an integral part of that growth and success? How can the vision of small farmers in bananas continue to thrive? This is becoming increasingly challenging in a competitive grocery landscape where consumers are often making decisions based solely on retail price. That said, in these challenging times, it is even more important to stay true to the roots of fair trade. This is why at Equal Exchange we truly believe that small farmers are making big change.
 
 

CANADIANS LOVE THEIR BANANAS
 
Jennie Coleman, Director of the Canadian Fairtrade banana company Equifruit and her team, give us an insight into how North American consumers are changing.
 
In 2016, Canadians consumed a whopping 15.7kg of bananas per capita, miles ahead of their second closest fruit competitor, melons, which came in at just 10.9kg, trailed closely by apples at 10.2kg per capita.
 
Bananas rank first in terms of volume of imported fruit to Canada (588 thousand metric tonnes in 2016, or 34 thousand standard 40ft containers) but dead last in terms of value / tonnage: just C$920 (760 USD). The conventional / organic split is not part of statistical tracking, but we estimate it to be at least 90:10 in urban areas, and in many more remote parts of the country, more like 100:0. We also estimate that bananas with Fairtrade certification account for less than 0.5% of total Canadian sales.
 
As with many other jurisdictions, Canadians have been led to believe, for generations now, that bananas are cheap. Many have no idea how the banana is produced or what is involved in getting such a temperature-sensitive fruit to the store shelves, despite our country’s frigid climate. Most have never seen a banana plant, and we are now ready for the inevitably awkward moment at trade shows when people ask us if these bananas we’re peddling are “local”. How do you answer that? Where do you begin?
 
There is tremendous interest in local food in Canada, and across our vast country, there are some 130 thousand hectares of land devoted to seasonal fruit production, nearly 60% of which is for blueberries. Canadians consistently list “local” as an important purchasing criteria and supermarket websites are replete with videos romanticising that nearby family farm which supplied your tomatoes, apples or peaches. Provincial marketing boards have programmes to draw consumers’ attention to “made here” products and oh my, Foodland Ontario’s “Good things gro-oh-ow in On-ta-rio” jingle (launched in 1980 and still in use today) is guaranteed to never get out of your head. But despite this focus, retail produce buyers tell us that given the option between gorgeous local strawberries at C$3.99 / pint and wooden berries from California at half that price, sales of the cheaper imports will far outpace those local berries.  
 
(Photo: The EquiFruit team)
 
So where does that leave us with Fairtrade bananas? The majority of Canadian consumers buy first on price, and the price of bananas is considered to be one of those “known-value items” which shoppers remember from week to week. Retailers worry that a higher banana price will reflect higher prices throughout the store:  in their mind, 99¢ / pound is some sort of magic price ceiling. (For some reason, despite using the metric system for temperatures and distances, Canadians still recognise produce prices in imperial measurements). The Canadian market is supplied almost entirely by the three largest banana multinationals, and though they have just about the best brand recognition in the produce aisle, their legacy has been one to supply cheap fruit, no questions asked. Tropical fruit is out of sight, out of mind for most Canadians, and you might conclude that people with so little understanding of how a banana is produced are unlikely to be aware of who is producing them, and under what conditions.
 
This is where Equifruit comes in. We are a small importer of Fairtrade bananas to Canada, currently with distribution in our two most populous provinces (Ontario & Quebec) but with ambitions to grow coast-to-coast. We were founded in 2006 by a mother-daughter duo who did tremendous work at the outset to establish a market for Fairtrade bananas: educating Canadians, building demand and convincing distributors to take a gamble on a values-based - and higher-priced - product. The first container rolled into Montreal in December 2007, and we haven’t looked back. The company changed hands in 2013, and the new management team stayed close to the company’s founding values but brought in a more aggressive growth strategy which has paid off: sales have tripled in less than 5 years, and we’ve barely scratched the total Canadian opportunity.  
 
Equifruit earns its income by selling premium-quality Fairtrade, organic bananas, but what motivates our team most of all is educating Canadians about banana supply chains, talking to them about a fair distribution of value, and most of all, reminding them that behind every banana they eat, there are hard-working people who deserve to be paid a fair wage for the fruit we enjoy here in Canada. We’ve seen conventional (non-Fairtrade) bananas for the shockingly low price of C$0.29 / pound, so we’ve got our work cut out for us when we try to convert shoppers to our Fairtrade, organic banana, which retails at our largest customer for C$1.49 / pound.
 
Our message seems to be getting through: we are tapping into that desire to know your “local” supplier by demonstrating that Equifruit has direct relationships with the small-producer coops in Ecuador & Peru who supply our bananas. By respecting Fairtrade standards, we are proud to have transparency in pricing and traceability in our supply chain. We delight in showing Canadian customers our packing lists, on which we can see for example that small producer Juan Calderon More has contributed 18 cases to pallet 6 of our latest container. We know Juan, and we’ve met his mum (also a small banana producer), his siblings, his wife and children. Juan’s life has been transformed by Fairtrade and his coop’s direct access to the export market - and all this, by the simple gesture of paying slightly more for bananas at the till here in Canada. They’re still cheaper than conventional (non-Fairtrade) apples, the next cheapest fruit at their grocery store.
 
Along the way, we’re also building our brand - and in fact, with our banana sales increasing and our reputation for good quality, ethically-sourced fruit gaining momentum, many of our customers are asking us what other Equifruit fruit we can supply. We want to keep growing our banana business, but we also want to expand the availability of other Fairtrade fruit on the Canadian market.
 
Equifruit is female-owned and managed, and in this male dominated industry, many of our customers don’t quite know what to make of us - but we do business differently, and the market has responded positively to our authenticity, our commitment to our producers, our creative marketing approach, and our customer focus. We’re building allies, from large chains and distributors, to small independent retailers and average Canadian consumers who share our vision.  
 

ORGANIC BANANAS FROM SENEGAL

After a long period of drought in the 1980s, hundreds of people migrated towards the Gambia River, south of the city of Tambacounda. They established new villages, and soon the farming families organised themselves into the Association des PROducteurs de la VAllée fleuve de la Gambie (APROVAG), which today consists of 10 local farmer groups (Economic Interest Groupings - EIGs) in seven villages.
 
Over the years, APROVAG has developed into a strong farmers’ organisation. The families in the region depend on the cultivation of bananas for about 70% of their income. In addition, they grow cotton, peanuts and food crops. Only 35% of APROVAG’s members are able to put aside part of their profits after selling in order to save money. The ‘soudure’, the period when there is no banana harvesting, remains a precarious time for many families. About half of the farming families still find it tough to get by during this period.
 
(Photo: Vredeseilanden)
 
Banana-growing nevertheless shows great potential. Bananas are in great demand on the Senegalese market, especially in the cities. But farmers’ organisations such as APROVAG find it hard to compete with the bananas from the Ivory Coast, which originate from plantations destined for export to Europe, and are of higher quality. The members of APROVAG need to move up a gear to catch up. Vredeseilanden has supported the farmers’ organisation since 2007 in its ambition to develop into a professional partner in the Senegalese and international banana business.
 
In 2010 fruit importer Agrofair came into contact with APROVAG. Agrofair brings, for example, Fair Trade-certified bananas of the ‘Oké’ and ‘Eko Oké’ brands to the Belgian market; these are mainly of Peruvian origin. Since the organic Fair Trade banana market is on the rise, and since it is interesting to diversify the supply with bananas from Africa, they looked for new producer organisations with which to collaborate.
 
Two years after their first meeting, Agrofair decided to step up its support for APROVAG with a view to the export market. Vredeseilanden subsequently introduced them to the Colruyt Group, the biggest retail group in Belgium. Colruyt showed interest in buying bananas from Senegal. The result of all these efforts was a unique partnership in which transparency and cooperation in support of small-scale farmers are the key factors. Our purpose is to set up an efficient chain of quality bananas from Senegal to Belgium, which will benefit each link in the chain. And the ultimate goal is a higher income for farming families.

WINDWARDS BANANAS – STRUGGLING TO SURVIVE

Former WINFA Coordinator, and Chairperson of the World Banana Forum Executive Board, Renwick Rose, writes about an issue exercising the struggling Windwards industry.
 
The Windward Islands banana industry is still struggling to recover, even partially, from a series of setbacks over the past two decades. These have been caused by both man-made and natural factors and have resulted in a significant reduction of banana exports from the Windward Islands to the UK market under existing European Union regulations.
 
In particular, the impact of climate change has resulted in a series of natural disasters – devastating hurricanes and storms, floods and drought, which, compounded by the ravages of the black sigatoka disease, have drastically reduced exports to the UK. Currently, neither Dominica whose production was totally wiped out by hurricanes in 2017, nor St Vincent and the Grenadines, exports to the UK, leaving St Lucia as the lone exporter from the Windwards.
 
(Photo: Winfresh)
 
But even there, challenges are being faced arising from the constantly changing nature of the British banana market, dominated by the big supermarket chains. One recent problem that arose lately concerned the impact of the use of the IFCO plastic crates for banana exports. As more and more of these are being used in accordance of the demands of the market, it has been affecting the business of the Winera company which has been manufacturing cardboard boxes for supply to the banana industry.
 
There have been concerns expressed by the local trade union representing Winera employees about the possible closure of the Winera plant and job losses. Calls have been made for the intervention of government. However, both WINFRESH, the exporting company, and the St Lucia National Fair Trade Organisation (NFTO), have clarified misconceptions about the situation.
 
Both have pointed out that the use of IFCO crates is nothing new, but part of a market-driven trend. In fact the NFTO, which represents small farmers who produce the fair trade bananas, has said in a statement that “the use of trays has no negative impact on the NFTO or its farmers”, and went on to claim that “it is more beneficial to our farmers because they are much cheaper, stronger, less labour intensive and less likely to collapse in moist or wet conditions”.
 
For its part, WINFRESH has been engaging in discussions with Winera and is seeking agreement with its UK customers to extend the change-over period so as to minimise sudden shocks.
 

TESCO: PROGRESS ON PUBLIC COMMITMENTS ON LIVING WAGES
 
This is a statement that has been jointly agreed by Banana Link and Tesco on the progress made against the pioneering commitments made by the supermarket chain.
 
In 2014, Tesco became the first retailer to commit to paying a living wage to banana workers by 2017, covering sourcing sites that only supplied Tesco. Banana Link welcomed this commitment as a progressive statement of leadership in the urgently needed task of bridging the gap between the actual wages earned by banana workers and their real costs of living.
 
This commitment has driven a challenging journey, partly because living wage benchmarks have not yet been agreed for the relevant countries (It was expected they would have been in place by now). Tesco’s banana sourcing has also evolved so that it now has fewer ‘exclusive supply’ arrangements, and it has become clear that paying a living wage is very challenging to achieve in isolation. As benchmarks are created in coming months to calculate the living wage levels in key banana exporting countries, including Ecuador, Costa Rica and Ghana, all industry stakeholders have to collaborate together to both validate these levels and to develop strategy of how the required wage increases can be met. In Costa Rica, a key source of fruit for Tesco, the UK retailer is playing a lead role in this work. We understand it is unlikely that any retailer, no matter their size can ensure living wages at plantation level when they only buy a proportion of fruit from a producer.
 
Although Tesco cannot assess directly against the living wage pledge it made in absence of living wage benchmarks being agreed, we understand that the company is monitoring progress against what they believe the benchmarks may be set at, based on information currently available, and that their assessment reports promising progress for the majority of workers against those levels. Banana Link expects that validation of these benchmarks will reflect this progress.
 
(Photo: Philip Wolmuth)
 
We welcome anecdotal evidence from other industry actors in Costa Rica that some of the higher prices offered to their core supplier by the British supermarket have enabled wage increases for some of the lowest paid workers. But we also underline the importance of the mechanism of collective bargaining between independent trade unions of workers and employers as the most democratic means of securing better wages and conditions that can be sustained and defended in national legislation. The freedom to bargain collectively is one of the basic rights enshrined in the Ethical Trading Initiative (ETI) Base Code, but is still not sufficiently understood and supported by many companies.
 
Tesco recognises this, but also recognises that this is not possible in all countries, and that other democratically elected worker organisation structures exist and can help give voice to worker concerns.
 
In Ecuador, it was the proactive role of the national government between 2008 and 2015 that enabled the gap between the lowest actual wages in Tesco supplier plantations and living wage levels to be all but closed, although current moves by the new government to reverse some of the positive changes made over the period in employment and labour legislation are of deep concern to Banana Link.
 
We also welcome Tesco's continued broader leadership within the industry-wide multi-stakeholder initiative, the World Banana Forum, and its Working Group on the Distribution of Value along the Chain. This Working Group provides an opportunity for all actors, including the trade unions representing plantation and packhouse workers, to work together to address living wage levels, as one of the key elements that comprise the costs of sustainable production (COSP). The second public commitment made by Tesco in 2014 to cover COSP has also proved challenging to implement in the absence of sufficient progress on living wage benchmarks which are a key component of COSP. We hope progress in this regard will be made during 2018 with key suppliers to ensure global efforts are steered towards ensuring all participants in the value chain (including workers) are properly compensated.
 
In 2018, Banana Link looks forward to strong engagement by Tesco and other retailers in key consumer countries to establish a better understanding of the role of prices paid to growers in determining how much value exists to be distributed at the producer country level of the chain, including to workers as wages. Low and downward pressure on prices will always undermine the ability of workers to earn a living wage.
 
Finally, we welcome Tesco's continued key role in work towards Gender Equity within the World Banana Forum which includes recognising the need to gather gender disaggregated wage data. This is crucial in enabling companies to understand the factors that create the gender pay gap, including task allocation, piece-rate tariffs, access to promotion and the women's active role in decision making.
 

AND FINALLY .........
 
We would like to share with you this video we made at the WBF conference in Geneva in November, in which various participants told us why they think the Forum is important.