Retail banana shortages have been averted after Colombian workers reached an 11th-hour pay deal with producers.
Earlier this month, 18,000 workers in the Colombian banana-producing area of Urabá voted in favour of strike action in reaction to proposed cuts in pay. It raised fears of banana shortages in the UK because Colombia accounts for 25% of bananas directly imported.
Workers – and members of trade union Sintrainagro – had until midnight yesterday (18 June) to set a strike date.
This morning, Sintrainagro issued a statement saying it “was able to ward off the strike”.
“Retailers… should now understand that the lower they push prices the less likely they are to be able to fulfil their commitments to ensure living wages are paid in their supply chains”
Alistair Smith, Banana Link
The Grocer understands that a 4% wage increase for workers in the first year of a two-year deal has been agreed and an increase equal to the Consumer Price Index will be implemented in the second year. There will also be increases in healthcare, housing, education and recreation benefits.
“An economic compensation of 300,000 pesos for each worker associated with Sintrainagro has been agreed, as well as improvements in aspects of social security,” Sintrainagro said in a statement.
NGO Banana Link said it hoped the recent threat of a shortage should focus the minds of those who made decisions on banana pricing. “Retailers who have led the last decade of futile price wars should now understand that the lower they push prices the less likely they are to be able to fulfil their commitments to ensure living wages are paid in their supply chains,” said Banana Link’s international co-ordinator, Alistair Smith.
The dispute between Colombian workers and producers is understood to have largely been caused by changes in the Peso-Dollar exchange rate. However, NGOs said unsustainably low banana prices being paid by retailers was partially to blame because it meant there was not enough money in the supply chain to pass back to producers and workers in the face of rising costs.