Cooperativa de Productores de Banano del Magdalena (BANAFRUCOOP) is a smallholder banana producers co-operative located in northern Colombia
About BANAFRUCOOP
Historically, the region of Magdalena has been very unstable and the theatre of armed conflicts involving revolutionary and guerrilla groups (FARC and EPL) that have threatened the life and the safety of its inhabitants. Today, despite a decrease in the intensity of armed conflicts, violence perpetrated by criminal gangs remains a serious problem in the region and substantially affects the productivity of small-holder farmers.
Background & structure
BANAFRUCOOP was established in 2007 by 26 small-scale banana producers who recognized the need for joining forces to increase the competiveness of their produce, meet the demands of the international market, and enhance the sustainability of their businesses. At present, the organisation is made up of 35 producers (11 are women) who grow premium quality bananas of the Cavendish variety.
Members of BANAFRUCOOP grow their produce on small plots of land averaging 5.6 hectares. Along with bananas, which are usually cultivated on 90% of the total land, farmers grow crops such as papaya and chilli. Members rely, principally, on family labour; however, the implementation of Fairtrade Standards, such as reducing the use of chemical pesticides, has increased the demand for local labour to carry out manual weeding and other tasks. Consequently, each producer now hires an average of 11 mainly temporary workers.
Production & sales
BANAFRUCOOP’s 35 members grow around 6,000 tonnes of bananas on almost 200 hectares of land. The production is entirely destined for export markets. Bananas are delivered by the producers to the exporter, C.I. PROBAN-UNIBAN S.A., via the co-operative.
In recent years, Fairtrade has promoted the implementation of modern and sustainable practices and technologies among the members of BANAFRUCOOP, bringing about an increase in productivity, quality and yield per hectare of bananas. Consequently, the co-operative’s annual production has risen from 4,800 tonnes in 2009 to 6,020 in 2012.
Fairtrade
BANAFRUCOOP was Fairtrade certified in 2009. The co-operative’s Fairtrade sales have constantly grown and, in 2012, 95% of bananas, corresponding to 5,170 tonnes, were sold on Fairtrade terms (compared to 52% in 2009). For Fairtrade sales, BANAFRUCOOP is paid the Fairtrade Minimum Price of USD 9.80/box (18.14kg), or the market price if higher. The Fairtrade Minimum Price is very important and beneficial for the producers. In particular, it guarantees regularity and stability of income and sales during the second half of the year, when the market price per box of bananas normally suffers a considerable reduction.
BANAFRUCOOP also receives the Fairtrade Premium Price of USD 1/box of bananas to invest in increasing productivity and quality, capacity building services, and a range of social projects that benefit the producers and their families. The premium is allocated among the different projects by the general assembly, which is the fundamental decision-making body of the organisation and is composed of all the members.
Fairtrade Premium projects
BANAFRUCOOP has used part of the premium to boost its members’ productivity and increase the organisation’s volumes of bananas, so that it can acquire greater commitments from traders. Thanks to these resources, the co-operative has been able to finance a fertiliser programme, consisting of monthly applications of fertiliser, which has enhanced the productivity of the smallholder producers, on average, by 20-25%. BANAFRUCOOP has also invested in irrigation systems for 18 farms. This project has generated significant gains in terms of productivity, as well as reduction of water and energy consumption. Moreover, in order to speed up and ease the transport of the produce, part of the premium has been used to improve or purchase pallets, and to install lorry loading platforms on all the farms.
Resources from the Fairtrade Premium have also allowed the organisation to finance capacity building and support services on a variety of topics. The premium has facilitated producers’ access to loans and microloans for different purposes: production activities, education, home assets, etc. In this regard, all the members of BANAFRUCOOP have accessed at least one loan from the co-operative, as opposed to only half accessing it from a formal banking institution. Other capacity building services financed through the Fairtrade Premium include: access to inputs (fertilizers, seals, rubber, fungicides, bags, tools, etc.), as well as agricultural and quality technical assistance, including training for the smallholder producers.
The co-operative invests a significant share of the resources from the premium in social investment projects, such as elderly, solidarity, and education support for the producers and their families. In particular, BANAFRUCOOP has instituted a fund for solidarity and social well-being for farm repairs, old age pensions, as well as life insurance and support for funeral costs for members and permanent farm workers. Furthermore, the organization has offered two university scholarships to children of producers, and housing for two workers and their families.
Finally, the organisation allocates between 30% and 40% of the Fairtrade Premium to cover its fixed costs, strengthen its administration, and maintain its certifications. In this context, the premium has provided BANAFRUCOOP with the necessary financial resources to offer full-time employment contracts to the administrative staff. Considering that these employees were either working part-time or as volunteers, this development has significantly benefited them and enhanced their job security.