Green Gold

Topics: European Union, Banana, Costa Rica Pages: 36 (11144 words) Published: February 26, 2013
Bananas: The "Green Gold" of the TNCs
Anne-Claire Chambron

Bananas are the fifth largest agricultural commodity in world trade after cereals, sugar, coffee and cocoa. They are a major staple food crop for many millions of people in areas of Central, East and West Africa, Latin America and the Caribbean. They grow easily, are cheap sources of energy and vitamins, and can be harvested all year round, thus providing a source of energy during the "hunger gap" between crop harvests.

Six countries (India, Brazil, Ecuador, Philippines, China and Indonesia) account for 55 per cent of total world production. Of the 86 million tonnes of bananas and plantains produced annually, only 14 per cent are traded on the world market. The two biggest banana-producing countries, India and Brazil, are hardly involved in the international banana trade at all. But, for at least 15 Latin America and Caribbean producer countries, they are a crucial source of export income.

Bananas are grown mostly by millions of small-scale farmers in Africa, South Asia and Latin America for household consumption and/or local markets. Most of this production is achieved with few or no external inputs. Once a producer grows for export markets, however, considerable and growing levels of external inputs (chemicals, fertilisers) are required to effectively compete in those markets.

The Banana Chain

The world trade in bananas is dominated by three companies: the largest producer and distributor of bananas is the US company, Chiquita (formerly United Fruit), reputed to have paid bribes in Central America and to have had links with a coup in Guatemala. Chiquita is the brand of United Brands which accounts for almost one third of traded bananas from which it obtains some 60 per cent of its profits. (Chiquita's prepared foods division, mostly meats and packaged goods, accounts for about half of its sales but less than 10 per cent of profits). Close on its heels is the US company Dole Food, owned by Castle & Cooke, a property and food group. Dole is the world's largest producer and distributor of fresh fruit and vegetables. Both these companies own large banana plantations in Central America, and effectively act as price-setters. The third largest transnational company is Del Monte Fresh Produce, owned by Grupo IAT, which also owns Chile's third-largest fruit exporter.

Chiquita Brands, Dole Food and Del Monte Fresh Produce together produce and control 65-70 per cent of world exports, which allows them to control the market and, to a considerable extent, to set the rules of the game. They are followed by the Ecuadorian company, Noboa, which represents another 10 per cent, and the European company Fyffes, which controls some 6-7 per cent. Fyffes is the UK and Ireland's main banana distributor. In Latin America, some national growers' companies are present on the international market, mainly Noboa, but also Sunisa and Banacol in Colombia, and Corbana in Costa Rica.

Ecuador, Costa Rica and Colombia account for around 64 per cent of world exports. Europe, the United States, and Japan together purchase around 80 per cent of all exported bananas. In 1996, world banana imports were valued at over US$7 billion, the European Union being the largest importer with nearly 32 per cent of all traded bananas. Each of the 350 million EU citizens consumes an average of 10 kg per year.

The EU produces nearly 20 per cent of its needs, and imports the rest from Latin America (the so-called "dollar" bananas), and from the African, Caribbean and Pacific (ACP) group of countries - the latter accounting for 17 per cent of imports in 1997.

The transnationals are generally associated with Latin and Central America where they control 60 per cent of production. They are vertically integrated, which means that they own (or contract) plantations, own sea transport facilities and distribution networks in consuming countries. The opening up of Eastern Europe and East Asia, the...
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