Banana Production Battered by Market Pressures Caribbean Weather

Banana farmer

The Guardian reports on the setbacks in banana production in spite of the hard work and persistence of Caribbean farmers, such as Stephen Best, a typical farmer in St Lucia. As the article points out, “At five acres, his farm holding is small. So, too, is his workforce of three permanent employees. As with the vast majority of his fellow farmers on the Windward Islands, Best primarily grows bananas for international export. Most end up on supermarket shelves in the UK.” Unfortunately, the farmers are facing hardship due to market pressure and bad weather.

Best shares the hardships of the average farmer in St Lucia. At the end of October 2010, his farm was battered by Hurricane Tomas, which decimated almost his entire banana crop. He had barely got back on his feet when his new crop was subject to an outbreak of black sigatoka, a leaf spot disease caused by ascomycete fungus. About two-thirds of farms in St Lucia suffered a similar fate. In neighbouring Dominica, the banana crop was totally destroyed.

These recent setbacks came in the context of wider market difficulties. Under pressure from large banana producers in Latin America, the European Union has been gradually dismantling preferential trade barriers over the past decade or so. Successive tariff reductions, which were initially put in place to protect Britain’s former colonies, have hit the Windward Islands hard. In the early 90s, they controlled about 40% of the UK conventional banana market. Today, their share is in single figures.

Along with increased competition, Windward Islands farmers have had to contend with lower prices due to over-supply on the international market. A price war among UK supermarkets has made their margins even slimmer. Over the past 10 years, the retail price of loose bananas has swung from £1.10 per kilo to as low as 46p/kg. Bananas are currently retailing at 68/kg in most large UK food retail chains.

Amid such market uncertainties, the introduction of fair trade has provided a saving grace for many farmers on the Windward Islands. More than nine out of 10 producers now sell under the Fairtrade label. As such, these participating small farmers are guaranteed a minimum price of $9.65 (£5.96) per box of loose (ie unpackaged) bananas, equivalent to $0.53/kg. Buyers agree to pay a premium of $1 per box, which is then re-invested in the producer cooperatives.

Working closely with government agencies and the Windward Islands Farmers’ Association (Winfa), the St Lucia National Fairtrade Organisation used funds generated via the $1 premium to support field rehabilitation, replanting and other reconstruction efforts for affected banana producers.

The Fairtrade premium also supports agricultural improvement programmes, as well as social investment and environmental sustainability projects. Participating farmers, for example, receive training on farm management, pest control, responsible chemical use and other sustainable farming techniques. A number of farmers have also begun to diversify into agro-processing ventures, such as jam manufacturing, as well as into tourism. In collaboration with local exporter Winfresh, Winfa runs a programme for the islands’ highest potential farmers. “We are looking at best practices in various regions and seeing how these can be adopted in our local conditions,” says Best, who serves as president for Winfa in St Lucia.

Shoring up their production and pursuing future diversification efforts will require capital investment by the small banana producer. Winfa is currently talking with key players in the banana industry to develop an action plan. Retailers could “dramatically help” growers’ efforts to win donor funding or preferential loans by explicitly supporting such finance applications, says Surmaya Talyarkhan, product manager at the Fairtrade Foundation.

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