Why cheap bananas threaten farmers’ futures and what the EU can do about it

A new report Britain’s Bruising Banana Wars: Why cheap bananas threaten farmers’ futures has been published by the Fairtrade Foundation on 24 February. The report looks specifically at how the pressure on the price of bananas in the United Kingdom (UK) has driven a trend in many banana producing regions towards job losses, the casualization of labour, and the marginalisation of smallholder producers. This makes it much harder to achieve the improvements that farmers and workers badly need – decent wages, access to services, and improvement of the environmental sustainability in banana production.

The analysis also includes suggestions and advices on what governments and authorities could do, including recommendations to the European Union (EU) that are relevant to the High Level Forum work stream on Unfair Trading Practices:

• Investigate the retail pricing tactics on bananas of retailers across Europe, including as part of the on-going European Commission (EC)’s Directorate-General for Competition study of modern retail on choice and innovation in the EU food sector, and evaluate the impact of low retail prices on the long-term interests of banana producers and European consumers. The EU must also commit to act on the findings. This is not a request for fixing prices, but an urgent call for an in-depth investigation into a market that is failing farmers, workers, and consumers.

• Show policy coherence by taking public policy considerations into account when applying competition law, in line with multiple EU Court judgments, for example by stating the relevance of Articles 11 and 208 of the Treaty of the Functioning of the European Union to competition policy.

• Consider adopting an ombudsman similar to the UK Groceries Code Adjudicator to regulate buyer power in the retail industry, starting with bananas, as a follow-up to the Green Paper on Unfair Trading Practices.

For more information, find here the joint letter by the Fair Trade Advocacy Office (FTAO) and the Trade Union movement to EC President Barroso, which lays out the shared views on this important topic, for which an equally-important decision on “next steps” from the EC is pending.

The report about abuses in the orange juice production sector we quoted in the last month edition of the FTAO Newsletter is now available in English.