Big banana companies agreeable to bury the hatchet on banana polevaulting with small growers in Davao Norte

march 28, 2014

by Cha Monforte, Rural Urban News

Representatives of large banana corporations have expressed agreement to settle the issue of pole-vaulting of contracts made by small banana growers and grower cooperatives in Davao del Norte, the country’s No. 1 banana exporter.

During the session of Davao del Norte Sangguniang Panlalawigan Monday, Stephen Antig, executive director of the Philippine Banana Growers and Exporters Association (PBGEA) said that there is need “to strike a win-win solution” to the pole-vaulting of contracts made by small banana growers due to high banana prices of “spot buyers.”

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Antig said that polevaulting is one of the problems facing the country’s banana industry alongside the continuing threats of Panama and Sigatoka diseases that give pestilence to banana plantations.

“Polevaulting confronts the banana industry in the last six years and so far we found no solution to it,” he told members of the provincial board.

“Those offering high prices are spot buyers who come in during good times and left and abandoned them (small growers) during good times. They lost their so-called Big Brothers who did not stand by them through thick and thin,” Antig said.

He added that it has come that way because “spot buyers have no investment unlike the corporate farmers.”

Antig however said that the buying price of banana is “supposed to be negotiated every year” adding that there is a need to revisit contracts between the banana companies and small banana growers.

Large banana companies have been facing an issue that they have tied up small growers in contracts with in low buying prices for too long a time that resulted to miserable economic plight of small growers and landowners.

In early 2000s, landowners in Davao del Norte and neighbouring Compostela Valley had started growing their own banana plantations after the contracts leasing their lands for 20 to 30 years to directly farming large banana companies expired. The banana industry in the provinces started in the late 60s and early 70s.

The bananas of small growers were then contracted to be bought by the big banana companies which provided funding and technical support to landowners.

Pole-vaulting of contracts comes when banana growers pole-vaults from their usually long-term contracts with buying banana firms as the supposed sole buyer and they sell the bananas they harvested to other buyers such as the spot buyers like those coming from China.

In the recent years, there were sporadic incidents where small growers and big banana firms went on hostile confrontation like when the latter made road blockade to trucks loaded with bananas of small growers and bound the port for export. They ended in police blotter and jail and in pending legal cases.

The phenomenon on rise of independent small growers and small grower cooperatives engaging with big corporate buyers and spot buyers then started in the province, which alarmed the circle of big corporate banana firms, as small growers gained high income from higher prices and as landowners became rich with them constructing their own bungalows and mansions near their plantations, that they did not dream to happen before.

“It is really a tall order to stop pole-vaulting as the Dept. of Agriculture itself has a hard time to contain it considering that we are in a free enterprise,” Antig pointed out.

Antig presented a situation where landowners even boasted that they were willing to be jailed for pole-vaulting as they could afford to hire lawyers for their plenty of money out from bananas.

He broached the idea that Davao del Norte would enact an anti-polevaulting ordinance similar to the ordinance criminalizing pole-vaulting in South Cotabato.

“The other ordinance I would like to request next is the ordinance against fly-by-night packing banana houses as these affected the quality of our bananas.  In the last three years, there is a tremendous reduction of the volume of bananas that is accepted in China. Penalizing backyard packing houses is a big boost to the industry,” he said.

Severino Mercado, a big banana grower siding with big banana firms, also chided small growers saying “they have no economic size and they just can’t compete with big banana companies”.

He said that high pricing for small growers “only happens once in a while.”

But Board Member Alan Dujali defended the small banana growers saying that the entry of new buyers rather “gives good prices” for bananas, citing that he came to know of growers led by employee retirees of large banana corporations who went into small banana growing and earned enough income.

He questioned the disadvantageous situation faced by banana grower cooperative producing in 200- hectare land with a buying price fixed to only 3 dollars per box of bananas without adjustment in five long years.

He said that if the buying  price is fixed at 2.80 dollars per box, 70 cents of which go to value-added tax, making small growers in difficult financial straits to pay their loans.

“Small growers should be given technical support, facilities, supplies including the chemicals and they should be given a good price that they can continue producing. They are just negotiating prices enough to feed their families. A win-win solution that is fair on both sides is really needed,” Dujali stressed.

Vice Governor Victorio Suaybaguio, Jr said that the legislative body is willing to accommodate the two parties settle the pole-vaulting issue as the banana industry that has made the province great as provider of incomes and thousands of jobs has to be protected.

The current buying price for bananas is reportedly at “high” average 5 dollars per box.

Four years ago the average buying  price of 3 dollars per box of bananas (13.5 kilograms) started after a long post in the range of 1.10 to 2 dollars per box, from the lowest 8 pesos per box in the 80’s.

There are more than 300 small banana growers cultivating in at least 1,500 hectares of land in Davao del Norte and Compostela Valley provinces. Small banana growers averaged to cultivate 10-hectare banana plantation while some have as low as 1- to 2-hectare plantation.

There are at least 45,000 hectares of cavendish plantations in the two provinces, Bureau of Agricultural Statistics said.

PGBEA said that there are at least 82,000 hectares of banana plantation in 13 provinces in the country. It announced that the 14,000 hectares of banana plantation wrought by typhoon Pablo are now on the road to recovery and would be completely rehabilitated by the “end of 2014 or early 2015”.(Rural Urban News/Cha Monforte)

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