Winfresh has announced some major changes in the marketing arrangements for the sale of bananas in the UK Banana Market which will impact the local banana industry.
According to Winfresh, “The main customers purchasing bananas from Saint Lucia are changing their supply arrangements, which will result in the reduction in the number of ripeners/distributors handling their bananas.”
It also said “The major supermarkets are now dictating where and in what quantities and product lines or SKU’s the bananas which they buy, will come from”.
“In the case of Saint Lucia,” Winfresh says in a statement, “the volume to be supplied by Winfresh will be limited to the volume allowed per customer, which is currently the subject of discussion with the local banana industry, through the National Fairtrade Organization of Saint Lucia (the NFTOSL).”
The company explained that as a consequence of these new arrangements, “tthe combined volume of bananas from Saint Lucia that Winfresh can or will sell to its customers is severely limited.”
“More so,” the company added, “in the case of one customer, Winfresh will no longer have the opportunity to intercept the fruit and to manage it so as to avoid poor quality bananas reaching the supermarket shelf.
“Potentially, unless drastic steps are taken to resolve the persistent poor fruit quality problems, this could result in large quality claims which will be costly for the NFTOSL and the farmers.”
According to the statement, “This means, therefore, that all farmers supplying bananas to any UK customers must ensure that the bananas they supply are of the highest quality and that virtually every single box is consistently the same with little or no variations.”
It continues, “This is the standard which the market has set, and it is the expectation of the customers that all producers will conform to it, if they are to continue supplying bananas to them.”
Winfresh says it “has worked hard to protect the farmer base in Saint Lucia to ensure that, despite those challenges, they continue to retain a place in the market.”
“However,” it adds, “this is becoming increasingly challenging, if not impossible.
“Winfresh has repeatedly informed and advised the NFTOSL of the trends and expectations in the market and the need to adapt and conform to the requirements, in order to remain in the market.”
Winfresh says that in the weeks ahead it will seek to meet with all supplying farmers to provide further explanations on the new arrangements for 2019.
However, it adds, “It is important to note that world banana prices have been declining and there is now stiffer competition in the market from new and emerging suppliers, such as Ghana, which are able to sell top quality Fairtrade bananas to the UK at prices which are about US$2.50 per box lower than that which are supplied from Saint Lucia and even circa US$1.00 lower than those from Latin America who were previously the lowest cost suppliers.”
Consequently, the company says, “many buyers in the UK are now moving towards suppliers who quote lower prices and supply consistent quality, as they struggle to remain competitive and provide cheaper bananas to their customers.”
The statement concluded: “In the face of these challenges, the farmers in Saint Lucia are urged to look more closely at their operations to eliminate inefficiencies, improve yield and productivity and improve quality, in order to reduce production cost and meet the standards of the UK market.
“This is the only way to ensure that all their bananas are sold to the UK supermarket trade.”