Written by 9:29 pm Food

Prospere Issues Statement On UK Banana Trade Suspension

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The next is an announcement on the UK banana trade suspension by Hon. Alfred P. Prospere, Minister for Agriculture, Fisheries, Food Security and Rural Development.

In July of 2021 when the Saint Lucia Labour Party government got here into office, we found a banana industry that had collapsed under the UWP government.  Banana trade with the UK was halted for 2 years.  The critical infrastructure required to efficiently operate the industry was dismantled. The important banana exporting company WIBDECO/Winfresh ltd went into administration. key assets comparable to the ripening facility at Stanstead (UK) and Winfresh’s stake within the Geest shipping line were sold off to 3rd parties to fulfill debt payments.

This meant that the important components of the banana exporting company comparable to shipping, marketing, and logistics were lost. The local producer base/farmer’s organization, the NFTO was facing financial losses and technical challenges. They’d to instantly assume responsibility for the industrial arm of the trade although they didn’t have the resources and expertise to adequately perform that role. The situation on the time seems somewhat bleak.

My government, in recognition of the socioeconomic consequences and the critical role of the banana trade in rural communities found it essential to intervene for the sake of maintaining social peace and economic mobility in rural communities. Within the national interest, we saw it prudent to inject the essential financial and technical support required to recommence trade with the UK supermarkets. A loan facility was established to inject EC$3.8 million dollars into the NFTO.

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To further emphasize the commitment of the federal government to our farmers and the people of St Lucia, a government lead delegation traveled to the UK to fulfill with the supermarket representatives to determine how best to proceed with the trade and finalize contractual relations with our farmers.  Because the trade evolved, I demonstrated the interest of the Government of St Lucia within the banana trade by keeping in direct contact with our farmers, the NFTO, and our UK supermarket partners.

In early May of 2022, a technical delegation from the UK, visited St Lucia to find out the state of readiness prior to the commencement of trade.  The technical field visit was deemed satisfactory and trade with the UK commenced immediately on the fifteenth of May 2022.

Throughout the period of trade, the Saint Lucia Labour Party Government has continued to supply support to our banana farmers by subsidizing inputs comparable to oils and fertilizer to farmers. As well as, we now have actively pursued other regional markets with a view of providing further opportunities for our farmers.

We were successful for a certain period, whilst we tried to rebuild the banana industry. Unfortunately, the long-term impact of covid on the provision chain and the continued war in Ukraine have presented some major challenges that threaten the economic viability of the trade right now.

The high shipping and fuel cost related to a container of bananas is stated at US$8,200.00  per container and rising. Although fifty percent of the shipping cost was subsidized by the supermarket chain, it was difficult to sustain once fuel prices keep rising. The prices of key inputs comparable to fertilizer, oil, bags, and other inputs are rising day by day. The prolonged journey time to succeed in the UK is proving uncompetitive as in comparison with other suppliers.

The Geest shipping line has a monopoly over the route they’ve shown no interest to modernize the container units that transport our bananas. It’s critical to notice that if the UWP government had not sold off our stake within the shipping business, we’d give you the option to subsidize our shipping cost and modernize the containers to our requirements and choose a shorter travel route that will give our bananas a competitive advantage as was previously done after we once owned shares within the Geest line.  Today we are actually being haunted by this critical decision to sell our stake within the shipping business.

The continuing challenges required a review of the trade to judge the business case and ascertain whether the parties are making the monies that that they had anticipated prior to the commencement of the trade.

The contracting parties, NFTO, and the UK supermarket chain have informed the federal government that they’ve mutually decided to suspend the trade as they monitor the present situations impacting the trade each within the Caribbean and the UK. The price-of-living crisis and rising energy costs over the following few months have created major uncertainties for everybody. As soon as each parties are satisfied that it’s profitable to proceed then the trade might be activated.

Fortunately for our farmers, the efforts that we now have employed in pursuing the regional markets are showing signs of progress and growth. The consignment of bananas originally assigned to the UK market will now be diverted to the regional market and the weekly trade might be maintained.

The NFTO together with government support are currently following up on additional inquiries inside the region and shortly they’ll give you the option to extend our regional market presence and volumes.  We proceed to encourage our farmers to take care of the best quality that’s related to our bananas as we stay up for expanding the regional trade.

My government, a St Lucia Labour Party Government that “Puts People First”, will proceed to do what’s essential, to be certain that we respond to what’s within the interest of our farmers, as they seek to make an honest living, by doing what they love, and what they’re excellent at doing.

SOURCE: Ministry of Agriculture

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