Today’s Agtools Analysis is a topic that is near and dear to my heart: a detailed look at the banana market.
I’m often called upon to comment on retail banana trends, and have spent considerable time participating in discussions and attending workshops with groups like the World Banana Forum.
The WBF was celebrating a minor victory back in February as a working group of German retailers had pledged to recognize living wages, in particular, for global agricultural supply chains.
“We acknowledge that we, as the retail industry, have to take a proactive role to contribute to more socially and environmentally sustainable supply chains in the scope of the Agenda 2030 for Sustainable Development,” a statement said. “We will proactively engage in developing and implementing responsible business practices in coordination and cooperation with all relevant actors in our global supply chains.”
But could this happen here?
Bananas are a challenge, particularly in North America, where consumers are accustomed to prices that are often lower than the true cost of production. Here in the U.S. and Canada, it’s nearly impossible to raise prices to a sustainable level because no one wants to be the first to do it because the store across the street will lower prices in response.
Retailers often pin their overall store value perception on the low cost of bananas because it’s a price that “everyone knows.”
I’m not sure that’s the case for Millennial and Gen Z shoppers, so there’s hope for those working for more equitable pricing structure in banana production, like fair trade groups.
And, of course, anti-trust laws forbid collective negotiations on fair pricing structures.
Thus, the cycle continues.
Today’s Agtools Analysis had suggested headlines like “2020: It’s Bananas” and “Bananas are hanging around” and “Retail pricing has been bananas,” and it’s true.
When it comes to bananas, there’s a reason we use the word interchangeably with descriptions for insanity, because it’s nearly impossible to make sense of how this all continues to operate the way it does.