Dangerous things, bananas. They may look innocuous and yellow, but wars have been fought over them, governments toppled, populations held in servitude by mighty corporations. We’ve come a long way from the United Fruit Company and its CIA plots, as detailed by Peter Chapman in his book Jungle Capitalists. But the ethics of bananas are back in the news this week.
According to the Fairtrade Foundation, there has been a decade long price war over Britain’s favourite fruit. The supermarkets have been competing to deliver the cheapest bananas. While the price of other foods has gone up, the price of bananas has fallen by 40% in the last ten years.
Cheap deals for British shoppers – but someone always has to pay somewhere down the line. Someone far away in the supply chain, well out of sight. In this case, farmers in Ecuador, Costa Rica or the Philippines. To make matters worse, the price of inputs such as fertiliser has gone up, making bananas more expensive to produce. Producers are squeezed between rising costs and falling returns. “Ultimately,” says the Foundation, “the price wars are funded by the people who can least afford it – the small farmers and plantation workers who have to work harder and harder for wages that are worth less and less in their communities. As a result, a product that is worth billions of pounds in global trade relies on poverty level wages for the people who grow it.”
The reduced wages for farmers have environmental consequences too. In order to compensate for lower prices, farmers intensify production, using more water and chemicals. This is a short term strategy, risking soil exhaustion and biodiversity loss. More intensive production also increases the risk from diseases such as Black Sigatoka, a problem that threatens the future of banana cultivation on a fairly epic scale, as I’ve written about before. In short, the current banana market is socially, economically and environmentally unsustainable all at once.
This Fairtrade fortnight sees the launch of the Make Bananas Fair campaign, which aims to highlight the problems and improve wages and working conditions for farmers. Despite the above concerns, the campaign actually starts from a strong base. 35% of bananas sold in Britain today are Fairtrade. Sainsbury’s, Waitrose and the Co-operative only sell Fairtrade bananas. It’s up to the other supermarkets to follow suit, and to encourage them to do so, the campaign has scored the supermarkets on their ethical performance.
This may need tougher action too, as there appears to have been a market failure here. Britain’s grocery trade is dominated by 7 big companies. With all of them locked in competition to deliver low prices, there may not be enough players in the market for it to correct unsustainably low prices. The Office of Fair Trading might want to look into that. Consumers can sign a petition to the Business Department to investigate unfair pricing too – it’ll take you one minute, if you want to go there next.