This merger means that effectively the number of banana traders controlling 75% of the world trade in bananas has reduced from 5 to 4. In turn they sell the vast proportion of their bananas to a small number of large supermarkets and, in the UK, the majority of supermarkets are themselves locked into a vicious price war that has been progressively stripping value from the entire banana supply chain.
A report released by The Fairtrade Foundation two weeks ago entitled Britain’s Bruising Banana Wars reveals that, in the past 10 years, the UK supermarket sector has almost halved the shelf price of loose bananas while the cost of producing them has doubled. Our report shows that farmers and workers are the collateral damage in the banana wars. They are struggling to make ends meet, send their kids to decent schools or have access to healthcare, whilst we enjoy ever cheaper and cheaper bananas.
The Fairtrade Foundation believes this merger is further evidence that the price wars are creating a clear squeeze for everyone in the supply chain as the merging companies have themselves said one of the main drivers for joining together has been the need to find cost savings.
This news of further concentration of power in the sector means the Foundation is ever more convinced of the importance of the recommendations of Britain’s Bruising Banana Wars which calls for commitments to paying costs of sustainable production and living wages throughout the banana industry. This is what we in Fairtrade have been calling for in the past two weeks as part of Fairtrade Fortnight (24 February – 9 March), and now there is even greater urgency.
The Fairtrade Foundation is also recommitting ourselves ever more urgently to the main recommendation of the report which is calling the government to investigate retailer pricing of bananas and the impact on banana farmers and workers.
For more information, please contact Eileen Maybin on 020 7440 7686