They’re one of the most popular fruits in the world, and there’s a high probability you’ve got a bunch on your kitchen counter right now. Bananas may be the most familiar fruit on grocery store shelves, but behind that bright exterior, there are steep hidden costs that take a heavy toll on people and the planet.
Canada is woefully behind in retailing bananas traded under fair terms. Where other countries see major retailers committing to 100% Fairtrade banana sourcing, in Canada, Fairtrade bananas are only available in IGA, Sobeys, and Avril stores in Quebec, Farm Boy and Longo’s Markets in Ontario, and Choices Markets and a number of smaller retailers in British Columbia.
Millions of people worldwide depend on the production, processing, and sale of produce for their livelihoods, incomes, and food security. This includes many small farmers in the Global South. In Canada, bananas comprised 9% of the $6.58 billion in imported fresh fruit in 2017, making it by far one of the most consumed fruits across the country.
Bananas are actually the world’s most exported fresh fruit. But a highly competitive market creates price pressure on bananas, ultimately putting the squeeze on banana growers. Large multinationals wield considerable influence and retailers often offer deep discounts on bananas, sometimes selling below cost to attract customers. Together, these factors put banana producers in a bind.
Harsh production methods are used including irrigation and the use of harmful pesticides to control plant diseases.
Banana production can have negative impacts on soil, water, air, animals, humans and biodiversity.
COST OF PRODUCTION
Rising production costs and competition among traders exert pressure on market prices and therefore farmers’ wages.
WHAT ARE HIDDEN COSTS?
Hidden costs, also called external costs, are costs not included in the price you pay for a product.
But even though external costs are not included in the price of a product they still have to be paid by someone. These external costs usually fall on producers, workers, and their communities. Currently, banana production has negative effects on the environment and society. This causes so-called external environmental and social costs that until now have been unknown and not captured in prices.
Did you know that when you add up all the external costs of banana production that amounts to $6.70 per box of bananas? The most material social costs are insufficient wages and social security for workers and insufficient income for small producers. The most material environmental costs are land occupation, water depletion and climate change.
Fairtrade Canada’s mission is to empower banana farmers and workers, and consumers who buy Fairtrade bananas play a key part – the higher the sales of Fairtrade bananas in Canada, the more the benefits for producers accrue.
How do external costs of Fairtrade bananas compare? A recent study by True Price and Trucost on the external environmental and social costs of banana production found that the average external costs for Fairtrade producers are 45% lower than sector average producers.
Conventional banana production has a social cost almost 4 times higher than Fairtrade bananas. This is mainly due to lower wages, less social security for hired workers, and lower incomes of small producers.
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