During the #FairContracts press conference last Sept. 20 at Red Planet Hotel, Cagayan De Oro
Banana farmers and lawyers stressed in a media briefing in Cagayan De Oro, Sept. 20, that the proposed House Bill (HB) 5085 or the Agribusiness Ventures Arrangements (AVA) in Agrarian Reform Lands Act should be passed to better protect the rights of the farmers from big businesses.
“The AVA bill will not actually threaten the agribusiness as it will open a more participative environment where farmers are given more safeguards in securing their basic rights as farmers,” said Atty. Irvin Sagarino of the Initiatives for Dialogue and Empowerment through Alternative Legal Services (IDEALS).
He added that this bill is “not against investor companies but merely establishes a balanced relationship between the Agrarian Reform Beneficiaries (ARBs) and the company.”
AVA, according to the proposed bill, is an “entrepreneurial collaboration between ARBs and private investors in the implementation of an agriculturally-related business venture involving lands distributed under Comprehensive Agrarian Reform Program (CARP).”
In several AVA or contract reviews done by IDEALS, it was found that most of the contracts are prepared solely by the companies. The companies sell the fertilizers and other inputs for the land and will buy the products of the farmers as well. The prices of the products, however, often remain low while the prices of the inputs are solely controlled by the company.
The AVA bill guarantees the participation of the farmers in the farm management operations and ensures the productivity of the land and the incentives. It also requires a periodic review of the terms in the contract and gives the farmer beneficiaries the right to rescind these contracts.
Sagarino explained that these unfair contracts are rampantly seen in the banana industry, especially in the Mindanao region.
The Philippines has a billion-dollar banana industry. In 2016, Philippine Banana exports amounted to US $618.8 m or approximately Php 31 billion. Local banana growers, however, have not enjoyed the fruits of this big industry.
Rolando Torintera, banana farmer and manager of the Davao Fruits Banana Growers Agrarian Reform Cooperative (DFBGARC), said that their contract with SUMIFRU Philippines has pushed them further into debt and poverty.
“The price of the fertilizers when we started were at P400 per bag, now it’s P1000. SUMIFRU increased the price of the inputs, but their buying price for the bananas are still the same as it was back then,” said Torintera.
Since 2008, a box or 13.5 kg of bananas is only bought by SUMIFRU for $3.00. The banana farmers recently secured the price of their bananas up to $4.25.
Other companies, however, buy a box of bananas for $6.00. As of October 2016, the Freight on Board (FOB) price of Philippine bananas already range from $4.00 to $8.00. The Philippine Exporters Confederation – Davao even slated the price up to $10.00.
Torintera explained that whatever they have left for profit is “still not enough to pay for their land, loans, and for their daily expenses.”
DFBGARC is just one of the many banana farmer cooperatives who are tied to 10 to 15-year contracts with SUMIFRU Philippines and other multinational companies.
“While multi-national companies continue to expand its operation due to its massive profit from banana exportation, our banana agrarian reform beneficiaries continue to live in poverty,” he said.
“There is no question that they are at a losing end with respect to the current set up of their respective contracts,” said Sagarino. “Banana growers’ poor grasp of the law and the company’s act of taking advantage of their lack of comprehension have greatly contributed to their suffering.” #