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The Source of the 19¢ Banana

| Monday June 20th, 2011 | 6 Comments

Dole's shipping containers chock full of bananas

Trader Joe’s shoppers are probably familiar with the store’s incredible deal on bananas- 19¢ apiece for conventionally grown and 29¢ for organic. I’ve thrown many a bunch in my cart, happy to get a low price for such a healthy and tasty snack. Have you ever stopped to think about how that banana got to the store and how they can possibly be so cheap? I admit, I hadn’t really, until I took a trip to Costa Rica (sponsored by Dole) to check out their banana and pineapple plantations and shipping operations. It’s nothing short of astounding.

Dole is the #1 producer of bananas for the US and Japan with 34% and 32% of the market share, respectively. They’ve got 9% of the market in Europe. Worldwide they sold approximately 153 million boxes of them in 2010. Those bananas come from Honduras, Costa Rica, Ecuador, Colombia, Guatemala and Peru, growing on approximately 32,000 acres of company-owned farms and around 71,500 acres of independent producers’ farms. 2-3% of the bananas sold are organic. (See Dole’s 2010 Annual Report for more info)

Believe it or not, from the fields to the packing, almost every component of getting those bananas ready is done by hand. How can it possibly be so cheap? And what’s the environmental impact?

All Hands on Deck
As you can see from the video above, the preparation of bananas for shipment is a very hands-on affair. Each touch of a banana will result in a bruise when the fruit ripens, so great efforts are made to reduce the number of touches.

Despite all the human attention to the fruit, it’s incredibly cheap, which means that wages are very low. A banana plantation must be located in a place where wages are extremely low to be anywhere near cost competitive.

Dole’s Costa Rican plantation workers are paid, on average, 46% above the national minimum wage of $10.31/day. Though unions are available (and 37% of Dole’s workforce worldwide belong to collective bargaining agreements), most employees in Costa Rica choose belong to Solidarismo, a social organization that is one part credit union, one part Lions Club, with a dash of union thrown in (except for the ever-important right to strike). [ed. note: Solidarismo is explored in detail here.]

Despite these outlets for worker protection, Dole currently has 11 labor cases pending in Costa Rica under the national insurance program, according to Dole’s 10-K.

At the end of the day, Dole did appear to be a pretty good place to work, at least considering the alternatives. A (female, Costa Rican) translator on the trip asked the banana packagers what they thought about their jobs and heard that the working conditions had improved a great deal in the past several years and the worker was very happy with her job. Everywhere we went, people smiled at us.

Environmental Impact
Every kilogram (kg) of banana produced results in 1.48 kg of global warming emissions, (at least to deliver the bananas to Norway, which is a bit further than they might go otherwise, but the study was commissioned by the Norwegian Research Council) and requires .19 square meters of land. But water is where bananas have their biggest impact, with 860 liters required to produce 1 kilogram of banana, according to the Water Footprinting Network.

On the Farm
The company’s Costa Rican operations are leading the way to make GHG reductions and efficiency improvements, due to Costa Rica’s commitment to become carbon neutral by 2021 and general support for environmental programs which protect the gorgeous natural landscape of the country.

On banana plantations, Dole uses precision agriculture and control-released fertilizers to reduce the GHG emissions by hectare by 45%.

Shipped Direct to You
Dole has a vertically integrated supply chain, which means it can both conduct carbon footprinting exercises and manage their emissions much more easily than a company that contracts out for shipping.

Dole’s analysis showed that there were efficiency gains to be made almost everywhere along the supply chain. They held driving seminars with their truck drivers to teach them about conservative driving, which resulted in a 10% reduction in fuel consumption. Where they could, they switched to rail transport, which resulted in a decrease of 34% in emissions from farm to shipyard transport.

Given the short life for fresh fruit, bananas enter refrigeration shortly after being picked. The company has also made great strides to reduce leaks in the refrigerated shipping containers, resulting in both cost and energy savings as well as huge reductions in global warming potential:

The company is also engaged in Costa Rica’s National Forestry Fund, a program to pay owners of rainforested land for not clear-cutting it.

Water Savings Strategies
Water is a key component of the environmental impact puzzle.

75% of water used worldwide is for agriculture, and nearly 66% of that is lost through evaporation and inefficient irrigation. That’s a big deal in Costa Rica, where 80% of the electricity comes from GHG-free hydro electric power. If the rivers dry up, the country will need to source more carbon-intensive power, which will make it more difficult to reach it’s 2021 goal of carbon neutrality.

Traditional water intensive banana packing plant in La Estrella Limon

Water savings are where Dole can really distinguish itself on the banana front. Traditionally, bananas are soaked in water when they reach the packing plant, in order to remove the latex that keeps them protected during the growing process. In the video above, you’ll notice very little water being used. That’s because the New Millenium Plant on the Rio Frio Banana Farm, simply dips the bananas in water, stores them upside down overnight and the latex rolls off on its own. The new system has resulted in a 90% water savings for the plant over traditional banana packaging facilities.

The facility has 1,600 hectares, about 13% of Costa Rica’s banana plantation land. Right now, the facility is the only one utilizing the water savings scheme, but plans are in place to expand it to other plantations.

So there’s your 19¢ banana in a nutshell. I’ve got a lot more news to report from the trip, including a visit to Doles’s organic pineapple plantation and some reflections on the stakeholder engagement component of the trip.


▼▼▼      6 Comments     ▼▼▼

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  • JoLeen Ong

    Thanks for this post- I was happy to see the human side of banana production was included in your article. Oftentimes the banana workers, who play a huge role in why consumers can get tropical fruit at the neighborhood Trader Joes for 19 cents each (or for 10 cents more an organic banana), are neglected in stories.

    However, I would have liked to see deeper coverage about the workers, especially given that the history of the sites you visited – Rio Frio and Valle de la Estrella- have a dark past where workers in the late 80’s were rendered sterile from exposure to harmful pesticides. We’re talking about pesticides/fungicides/herbicides that are so toxic they are prohibited in the U.S. Additionally, the Caribbean coast, namely Cahuita, with its national park and reefs, has been devastated over the years from runoff from the banana plantations. Fisherman along the coast will all tell you how their fishing industry has diminished – much of the fish you eat when on the Caribbean coast actually comes from the Pacific Coast.

    Regarding Solidarista Associations, you mentioned:

    “Dole’s Costa Rican plantation workers are paid, on average, 46% above the national minimum wage of $10.31/day. Though unions are available (and 37% of Dole’s workforce worldwide belong to collective bargaining agreements), most employees in Costa Rica choose belong to Solidarismo, a social organization that is one part credit union, one part Lions Club, with a dash of union thrown in (accept for the ever-important right to strike). I’ll be exploring the Solidarismo more thoroughly in another post.”

    Solidarista Associations are strictly a social organization that offers workers opportunities such as access to credit, schools, clinics. They are prohibited by law since the early 1990′s from engaging in any trade union activity, such as freedom of association and collective bargaining. However, in Costa Rica, they have these entities called “Permanent Committees” in which freedom of association and collective bargaining can take the place of trade union membership/representation. Members of Solidarista Associations are strongly encouraged to join these Committees. Statistics have shown that since its establishment in the 80’s, membership in these Associations has grown, whereas trade union membership has diminished.

    Solidarismo is said to be the ‘choice of workers’ because it gives them access to the social institutions that the Costa Rican government does not provide. The Province of Limon, especially the Port of Limon, is one of the highest sources of revenue for Costa Rica, yet the Province is the poorest, and are lacking in adequate infrastructure. The majority of the banana workers are migrant workers from Nicaragua and Panama. It’s hard to be the judge when it comes to identifying the ‘right way to organize,’ but it’s hard to deny that, while in the short run it provides workers with their needs, in the long run, it diminishes the very mechanism installed to protect workers’ rights, with adequate legal backing.

  • Lori Duvall

    Did TP ask Dole how this fit into their ‘sustainable’ strategy?

    http://blog.friendseat.com/del-monte-bananas-single-plastic-package

    • Jen Boynton

      Hey Lori,

      Thanks for your comment- Del Monte is the company that launched the individually wrapped banana. I’m not sure I buy it, but the argument is that those things give the fruit a longer shelf life. In any case, we did talk about it, and Dole doesn’t have any plans to move in the same direction.

      Cheers,

      Jen

  • gawain kripke

    Hi – thanks for covering this article. I don’t mean to be negative, but I was really disappointed in this article. the headline misled – offered no value-chain analysis. didn’t even try to rationalize and explain why the TJ organic banana is $0.10 more than the non-organic (that’s a HUGE 50% price premium!).

    I don’t mind that you took a junket with dole – or even that you give them some positive coverage of the positive steps they’re taking. But you shouldn’t overstate the case – and might make a clearer disclaimer that you can’t give a comprehensive or critical view.

    Your treatment of the labor and social concerns is atrocious. The happy workers, smiling and reporting that everything is fine (through an interpreter) to you on a company-sponsored trip? Please. Have some self-respect as a journalist. Either don’t report that pablum, or do some interviews off-site, anonymously and/or with unaffiliated organizations (like a trade union?!).

    overall, I give you a barely passing grade. It’s great that you’re getting into the supply-chain and sourcing issues. Great that you’re at least paying a little bit of attention to the labor/social dimensions. But this is really not adequate.

    regards,

    Gawain

    • Jen Boynton

      Hey Gawain,

      Thanks for your feedback. This post was focused on the environmental issues, which were the main focus of the trip. Most of the attendees represented environmental organizations.

      TriplePundit’s tone is what we call “critical optimism” which means we give companies the benefit of the doubt (whether or not they give us free trips) and we call them out when need be. I was genuinely impressed with Dole’s environmental efforts. However, labor issues are obviously a huge piece of the puzzle and a key part of sustainability.

      I’m working on another post on labor issues which should be running next week. It’s a bit more difficult to pull together, because I don’t speak spanish well enough to have done much primary research, and I want to be fair to Dole and the workers in my piece. Stay tuned!

      Jen

  • Mary Rene

    What about packers and customers with latex allergies? I may never eat a banana again.