Cassowary Coast banana farmers want changes to market structure

Banana growers who say they’re receiving as little as $10 per carton, which is costing $24 to produce, believe the situation could have been avoided. HERE’S HOW

NERVOUS family farm banana growers on the Cassowary Coast are calling for top-end systemic changes to improve market conditions amid fears the industry is on the brink of collapse.

Lower Cowley banana farmer Paramdeep Singh says he, and other small growers were struggling to stay afloat as a prolonged surplus in supply was driving down prices and returns to below the cost of production.

But Mr Singh says the situation could be avoided or at least improved with changes to communication and the central market structure – warehouses in the capital cities where agents sell the fruit on behalf of farmers to buyers including supermarkets.

Mr Singh said some growers had direct deals with major supermarkets and did not trade via the markets, but said excess fruit to a supermarket’s needs from those deals should not then be entering the central market.

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“Because they make their money directly, any excess coming back on to the (central market) can be sold cheap and it just makes it hard for the rest of us,” he said.

However a Woolworths spokeswoman confirmed it was not the supermarket’s decision to return excess fruit to the central market, and that it was up to the grower.

Mr Singh said in the past 12 months cost of producing a carton of bananas had averaged about $24, while returns had averaged about $10.

He said while there needed to be more control of quantity entering the markets, he also called on the Australian Banana Growers Council to increase its communication back to farmers.

“If you talk to ABGC, they say it’s a supply and demand issue,” he said.

“And if it is, they want us to drop 10 or 15 per cent from what we’re sending down, they have to let us know. We shouldn’t have to be watching the market, they should be advising us.”

ABGC chair Stephen Lowe said at times, the council did advise growers of oversupply issues.

“The ABGC has also recently advised the major retailers of the impact that acute cost rises are having on a growers’ bottom line. Ultimately in a free trade market the retailer will set their retail price at a point determined by their own business model pressures.”

Cassowary Coast banana farmer Parvinder Grewal is concerned the industry will collapse if changes aren’t made to the central market where produce is bought and sold. Picture: Arun Singh Mann

Silkwood banana farmer Parvinder Grewal said farmers were “price takers, not makers,” and could not pass on the rising cost of production into their goods unlike other industries.

“It will get to a point where the Cassowary Coast will collapse, family farms are a big part of the economy here,” Mr Grewal said.

“These small family farms will get to a point where they can’t pay their rates any more, or shop in town.”

Originally published as Cassowary Coast banana farmers want changes to market structure