Fairtrade Foundation statement on banana price wars

8 October 2009

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While retailers say that they are funding the price reductions, experience has shown that ongoing banana wars between supermarkets have resulted in sustained pressure on suppliers to cut costs. And in conventional supply chains, growers already reeling from a decade of falling prices will not be immune from the long term effect of these price wars.

‘Price cuts serve only to devalue bananas yet further, creating a false illusion amongst shoppers that they can be sustainably produced for such give-away prices,’ says Barbara Crowther, the Fairtrade Foundation’s Director of Communications and Policy. ‘This is highly irresponsible at a time when farmers and workers across the developing world are facing their own economic crisis, as well as battling the growing effects of climate change.’

Research shows that consumers do not welcome pointless price wars when they hear how unreasonably cheap bananas damage the livelihoods of farmers and workers. A recent IGD consumer survey found that, despite the recession, seven out of ten people still say it is more important to provide good pay and conditions to workers in poorer nations even if more expensive, with only 30% citing lower prices as their key pre-occupation.

Further proof of the value that shoppers place on responsible sourcing can be seen in the continuing rise in Fairtrade banana sales. In particular, the Foundation has commended Waitrose and Sainsbury’s for the scale of their commitment to Fairtrade, and Sainsbury’s saw overall banana sales grow by 10% following their 100% conversion to Fairtrade.  However there are rising fears across the industry that Fairtrade banana sales could now be jeopardised as other supermarkets subsidise the price of conventional bananas, drawing shoppers towards less sustainable options.

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Notes to Editors

1.     The FAIRTRADE Mark is a certification mark and a registered trademark of Fairtrade Labelling Organisations International (FLO) of which the Fairtrade Foundation is the UK member. The Fairtrade Foundation is an independent certification body which licenses the use of the FAIRTRADE Mark on products which meet international Fairtrade standards. This independent consumer label is now recognised by 72% of UK consumers and appears on products as a guarantee that disadvantaged producers are getting a better deal. Today, more than 7.5 million people – farmers, workers and their families – across 58 developing countries benefit from the international Fairtrade system.

2.     Over 4,500 products have been licensed to carry the FAIRTRADE Mark including coffee, tea, herbal teas, chocolate, cocoa, sugar, bananas, grapes, pineapples, mangoes, avocados, apples, pears, plums, grapefruit, lemons, oranges, satsumas, clementines, mandarins, lychees, coconuts, dried fruit, juices, smoothies, biscuits, cakes & snacks, honey, jams & preserves, chutney & sauces, rice, quinoa, herbs &  spices, seeds, nuts & nut oil, wines, beers, rum, confectionary, muesli, cereal bars, yoghurt, ice-cream, flowers, sports balls, sugar body scrub and cotton products including clothing, homeware, cloth toys, cotton wool and olive oil.

3.     7 in 10 households purchase Fairtrade goods, including an extra 1.3 million more households in 2008, helping Fairtrade sales reach an estimated £700m in 2008, a 43% increase on the previous year. There are over 460 producer organisations selling to the UK and by the end of October 2008 872 certified producer groups were in the global Fairtrade system, representing more than 1.5 million farmers and workers.