"For bananas to be profitable for small producers, it was necessary to become Fairtrade certified," says Walter Javier Mauricio Canovas, general advisor of the Junta Nacional del Banano, the association that brings together small Peruvian producers and is currently made up of banana organizations from the regions of Piura, Tumbes and Lambayeque. "Before 2002, the producers sold the fruit directly at origin, but with the introduction of the Fairtrade label by Solidaridad and the Dutch company AgroFair, the fruit began to be delivered ExWorks. The average price paid to small producers went from two dollars per box in those years to about an average of six dollars now."
"In the 20-year history of Fairtrade bananas in Peru, I have seen more progress in the living conditions of small producers than in the 35-year history of the Fairtrade label in the coffee sector."
The export of Peruvian organic bananas started in 1995 through Dole Ecuador. The Fairtrade label had been used in Peru for the marketing of coffee and cocoa since 1998, but not until 2002 was the first container of organic and Fairtrade bananas with the FLO Fairtrade label exported from Peru to the Netherlands. "At that time, the organizations were only just starting. There were only small producers. When the Fairtrade supply arrived, a movement started to try selling the bananas for a higher price," says Walter Mauricio, who in those early years was himself an auditor for the Fairtrade label.
Piura is free of Sigatoka
The fact that Peru, unlike countries such as Colombia or Ecuador, can focus on organic banana cultivation has to do with the low relative humidity in the northern part of the country. "We are the only country that is free of Sigatoka thanks to the relative humidity. Colombia and Ecuador, which are countries with a tropical climate, are forced to apply treatments, mostly chemical ones, to keep the fungus at bay. However, the volumes exported from Peru are much smaller than those shipped by Ecuador, where the sector also has strong government support," says Walter Mauricio. According to FAO data, in 2022, Peru shipped 164,971 tons of bananas to foreign markets, compared to the 6,879,238 tons exported by Ecuador.
Major development in the living conditions of small producers
"The small scale of our productions and the fact that the acreage can't really be expanded a lot more due to limited water availability are two of the reasons why multinational banana companies are not active in our country," says Diego Balarezo, manager of Solidaridad Peru's fruit program. "For Peruvian growers, bananas are not as attractive as other fruits grown here, such as grapes, avocados or blueberries, which offer a higher profitability and better prospects for the future. In fact, while banana sales generate around 200 million dollars a year, blueberry sales deliver around 1.8 billion dollars, and this figure still shows an upward trend."
In the coming years, the banana sector is unlikely to grow in terms of acreage, volume or turnover, given the crop's relatively low profitability; however, Diego Balarezo says that "in the 20-year history of Fairtrade bananas in Peru, I have seen a greater development in the living conditions of small producers than in the 35-year history of the Fairtrade label in the coffee sector. Nevertheless, we have a big problem: we are already in the second or third generation of producers, dividing the land they own between their children.
Land is becoming more and more fragmented
"This generation reaps the benefits of the agrarian reform of 1969, when each family had an average of 3 hectares of land," says Walter Mauricio. "Now we are at an average of one hectare, but there are also many producers who own just 0.25 hectares or even less. Moreover, there are no signs of growers buying up land from other growers; instead, the land is becoming more and more fragmented. This is likely to change in the next generation, when this business model becomes unsustainable for many smallholders."
Banana cultivation is more profitable than maize or rice cultivation.
In any case, bananas remain the most profitable crop for small producers, according to Diego Balarezo. Much more so than maize or rice, two other crops in the Piura area. "In fact, in the last twenty years, the export of organic and Fairtrade bananas has allowed a radical eradication of poverty in this region. Peru is the only country where small banana producers, who on average own one hectare of bananas, are managing to earn a living wage, but this would be impossible if the sector wasn't organized in a cooperative model and if the product wasn't marketed as organic and Fairtrade."
A packhouse.
The threat of Tropical Race 4
Besides the ongoing fragmentation of the acreage, there is another problem which, according to Walter Mauricio, "we need to solve, as it may otherwise lead to the disappearance of the banana sector. Until last year, we hardly had any problems with this fungus, as it does not thrive in our arid climate; however, due to the El Niño phenomenon and the passage of cyclone Yaku last year, the fungus managed to spread because of the huge increase in relative humidity. Hopefully, our region's climatic conditions will remain arid in the years to come, as it seems that the only solution to tackle TR4 would be the introduction of a new resistant banana variety, as already happened in the 1950s, when the Gros Michel variety was affected by Tropical Race 1 and had to be replaced by the current Cavendish banana."
The National Banana Board was founded in 2014 with the aim of bringing together small producers and acting as interlocutor between them and other associations and Government bodies. "Many of the issues we have are linked to political advocacy and that is why we have the association. Among our achievements we can mention our participation in the advocacy of the new Law of Associativity, which gives small producers exemption from income tax. Also, last year, when there was a national strike in the heavy load transport sector, we negotiated with the unions in this sector to allow us to export," says Walter Mauricio.
For more information:
Walter Javier Mauricio Canovas
National Banana Board (Junaba)
Tel: +51 969 822 380, Peru
[email protected]
[email protected]