AgroFair Sustainability Report 2024

Sustainability Report

2023/2024

Dear reader,

This year, we are once again publishing a report on our sustainability activities and impact. And we have again selected from our activities and developments, numerical and interesting reports this year.

The banana production continues to face several sustainability challenges. The most significant is climate change, which has clearly cast its shadow over the past two years. Extremely high temperatures, much higher than the long-term average, have caused slowed growth and additional quality problems lately. In some countries, producers have even started spraying sunscreen over banana plants! Clients are increasingly experiencing the effects of lagging production and unpredictable quality. Meanwhile, pests and diseases are on the rise. In Peru, we have started introducing robust, durable banana varieties that are resistant to Fusarium wilt Tropical Race 4 and leaf spot disease (black Sigatoka). These hold great promise for making the banana production sustainable. We also remain committed to improving the working conditions and incomes of plantation workers and small producers. Moreover, although not much packaging is used for bananas - after all, the peel is a great natural packaging - we are still trying to reduce the amount of plastic used, and in case we cannot do that yet, to recycle it.

In short, a lot of work remains to be done and AgroFair and its producers are working daily to overcome these challenges and provide our customers with the highest quality, the most reliable delivery and the most sustainable bananas.

Kind regards,

Hans-Willem van der Waal, CEO

The future of the Sustainable Development Goals (SDGs)

Next year marks 20 years since the Sustainable Development Goals (SDGs) were adopted by the United Nations General Assembly, in September 2015. This prompted the scientific journal ‘Nature’ to reflect on this in June of this year and formulate some recommendations.

The SDGs are endorsed and very widely supported by governments, government institutions, municipalities, civil society organizations, and companies, and also by us, AgroFair. The SDGs should be met by 2030, so there are still five years to go. However, it is already clear that most of the goals will be far from being met. Poverty and hunger have increased again due to the COVID-19 pandemic, the direct and indirect effects of wars in various parts of the world (such as Ukraine, Gaza and Sudan), as well as the effects of climate change. Many low- and middle-income countries suffer from high levels of debt, and, as a result, there is not enough funding to invest heavily in education, health care, water supply, renewable energy, better land use and protection of natural resources. In addition, many goals were viewed in isolation from each other, with no synergy between education, health, employment, inequality and poverty.

In many cases, more developed countries made progress on their SDGs at the expense of less developed countries, particularly due to the consumption of products and goods that were imported. Consider the carbon footprint, the loss of biodiversity, deforestation, depletion of water resources, extraction of raw materials, pollution of

air, land, water, overfishing ... These environmental and social costs are not included in the price of these imported products but tacitly passed on to communities, governments and future generations of less developed countries, at the expense of their health, well-being and development opportunities.

Thus, international trade causes the unsustainable use of raw materials, natural resources and energy. Therefore, a separation occurs between consumption and wealth creation in the richer countries, on the one hand, and its negative impact in the less developed countries on the other hand. This burden affects the ability to achieve the SDGs in those countries.

This so-called “spillover effect” is a strong argument for looking at and measuring the SDGs differently, not just at the country level, but in a more global way, incorporating “planetary boundaries”. One action to be taken in this regard is to examine concrete international value chains more closely, and to identify benefits and burdens properly.

Ok, fine ... but what does this have to do with AgroFair, or the banana value chains in general?

Looked at properly, this is nothing new; it’s about including real social and environmental costs (now still considered as ‘externalities’) in the prices. Back in 2019, a ‘True Cost’ study on banana chains in Colombia, the Dominican Republic, Ecuador and Peru was published, which concluded that Fairtrade prices were the closest to the real cost and price.

In recent years, banana countries and branch organisations of banana producers have called on the European Union to replace unilateral measures on increasing restrictions on the use of agrochemicals,

stricter requirements for organic certification, and various sustainability initiatives, with a genuine dialogue; so that, among other things, the price tags attached to them can be discussed. Producers want to grow more sustainable bananas, but they think it is wrong that they are the only ones who have to pay for this. But that means the retail sector should also come to the table for such a dialogue, as they are generally the stronger party when it comes to setting the purchase price of bananas. This is why producers advocate again and again for ‘shared responsibility’.

Back to the SDGs ... Not much has been achieved yet, but the SGDs are well known and can have a unifying effect between governments, businesses and civil society organisations. Instead of abolishing them, Nature’s scientists argue for (1) extending the term of the SDG to 2050 and setting concrete interim targets for 2030 and 2040; and (2) taking sharp action to ensure that the goals are met - the time for noncommitment is over.

For AgroFair, the SDGs remain an important guideline

for joint action on concrete issues with producers. It would be great if closer cooperation and long-term commitment around the SDGs could also be achieved with the retail sector for each specific value chain.

The banana price is a ‘connecting theme’. Producer organisations and companies, sector organisations and even banana countries state that to produce bananas more sustainably (on a social and environmental level), supermarkets should offer better prices. In response to purchasing practices of certain discount supermarkets, the Ministers of Agriculture of Latin America’s major banana countries launched a remarkable lobby in 2022 to make Fairtrade minimum prices -based on real production costs- the starting point for this purchasing policy. This wish was recently reinforced by representatives of banana producers at the 4th Conference of the World Banana Forum (FAO), 12 and 13 March in Rome.

here to there: A world map of producing countries, selling countries and the distribution of

People

Our core values

At AgroFair, we have established fundamental principles that guide our actions.

MISSION

AgroFair is a market leader in fair and sustainable tropical fruit and fruit-related food products. We work inclusively, with a special emphasis on small producers and plantation workers, who apply fair, responsible, social, environmental, and economic standards, and who also participate in the governance and equity of our company, as shareholders.

VISION

We provide the consumer with various kinds of tropical fruit that are produced fairly and in an ecological and sustainable manner. We strive to be at the forefront by combining innovations in a sustainable and inclusive production and logistic process with marketing concepts. We are an inspiration for the industry. We offer our producers and their employees better livelihoods by harmonising the production with the surrounding ecosystems.

Business principles

For us as a company, it is important to define the behaviour and culture we want to promote, in other words, AgroFair’s core values. We do this by defining our business principles and providing practical guidelines for our operations.

Entrepreneurship

We do business with our producers, who are coshareholders of AgroFair. We aim to offer solutions to our customers that generate added value for them as well as for us. We act quickly to identify and develop opportunities. We answer any of our customers’ or producers’ questions promptly. We innovate and devise appealing new products and services. We are not afraid to try something new and are willing to take calculated risks. We are constantly striving to improve our operational performance and keep it at a high level.

People, planet, profit, prophecy

We understand that our impact is not just about our bottom line but encompasses many different aspects. Therefore, we evaluate our performance in different areas to ensure that we have a positive impact.

These areas are:

People.

We have objectively established that the rights and interests of producers and workers are adequately safeguarded.

Planet.

Our goal is to be a leader in ecologically sound production by looking at our own carbon footprint and aiming for the highest possible standards of ecological responsibility among our producers.

Profit.

We aim to achieve sustainable profitability for ourselves and our suppliers.

Prophecy.

We actively contribute to the sustainability debate in our industry.

Integrity

• Honesty and reliability are our top priorities.

• We do not give or receive gifts (money, presents, entertainment) that aim or appear to aim to oblige the recipient to something in return.

• We are accountable to our suppliers regarding the financial results of the parties.

• We treat AgroFair’s property and interests in a responsible way.

Quality

• We are all conscious of hygiene and food safety when handling our products.

• We strive to continuously reduce food safety risks and maximize transparency and integrity.

Our main brands

We offer four main brands to our clients: Latin Pride, Oké, Oké Organic, and Oké All Good. Each brand represents a step up on the sustainability ladder. Given the different needs/wants of our customers and markets, we provide specialised packaging together with our suppliers.

Certifications

We believe our products should meet high sustainability standards in production, which is why our suppliers tend to have one or more certifications such as GlobalGAP, Fairtrade and Rainforest Alliance. They comply with social and environmental standards that ensure us that suppliers adhere to decent working conditions, decent wages, environmentally friendly processes, and many other relevant elements. That is why we are confident that our sources for fresh fruit are consistent with our internal sourcing policy regarding social, economic, and environmental aspects.

On the way to the most sustainable banana

on the way to the most sustainable banana

Our Latin Pride brand is RainForest Alliance certified and is the solid base of our brand pyramid.

The Oké brands represent our strong commitment to our planet, its people and fair trade prices. Both brands have been awarded the Fairtrade Label, certifying that the production of these fruits complies with the highest social and environmental standards. On top of that, our green Oké brand is also certified organic.

At the top is our All Good brand, the first banana with a ‘true cost’ price, that is, with the environmental and social costs included. Usually, these costs are taken for granted and are treated as ‘externalities’, ‘hidden costs’, passed onto the local communities, the environment, the government or future generations.

For

www.agrofair.nl/supply-chain

Tulipán Naranja

Tulipán Naranja, our daughter enterprise in Peru, is an export company located in Sullana, Piura. Given the magnitude of AgroFair’s involvement in Peru, Tulipán Naranja was established in 2018 to support our producers in the region with:

• Logistics Operations

• Commercial Strategy

• Quality management

• Customs processes

• Internal Operational support

• Governance of the plastic recycling company

ECOBAN of which Tulipán holds 50% of the shares

Throughout the years, Tulipán Naranja has continued to expand, focusing on companies in the banana sector that want to access international markets but lack the resources to do so on their own.

Strengths and services that define Tulipán Naranja

Tulipán Naranja has two distinct segments in which they excel the most. Firstly, they have a technical and managerial team for quality control in the field, collection centres, and terminals in and out of the port if required. In other words, Tulipán Naranja monitors quality during each step of the supply chain until the container departures from the port of Paita. Secondly, they focus on supplying packing materials with logos, artwork and more. Their flexibility allows them to avoid delays, maximize time efficiency, reduce costs and ensure a sustainable supply chain.

In addition to all the services offered, Tulipán Naranja has been exporting organic and fairtrade bananas itself, specializing in flexibility and variety in packaging requirements and presentations. They are pioneers in implementing digital traceability by using barcodes to

identify fruit during the journey from the plantation of origin to the final destination.

In spite of the high expectations in banana production and major challenges due to diseases, water requirements, nutrient management and rising production costs, Tulipán Naranja distinguishes itself through constant communication between customers and the production team. This direct line of communication ensures that client concerns are promptly relayed to technicians and producers, enabling swift and effective responses to any issues that arise.

Finally, Tulipán Naranja has several certifications such as E.U. Organic, Global G.A.P. and Fairtrade as a trader. All these activities and services have yielded steady results in our operations as AgroFair in Peru.

Ronald Fernando Garrido Agurto, General Manager

Tulipán Naranja is led by no other than Ronald Garrido, a Certified Public Accountant by profession. Ronald has extensive experience in the financial field, dealing with the critical problems faced by producers and organisations, as well as in the best agricultural practices in banana cultivation. His vast knowledge and abilities are the reason he previously was General Manager at the largest organisation of producers in Peru, before assuming his new role in Tulipán.

During major changes within the company where he worked, Ronald decided to give a professional turn to his last 14 years of his career. Following his instinct, he decided to join the AgroFair team, and their project to start a business in Peru in 2020.

With determination, Ronald became crucial in the

development of Tulipán Naranja S.A.C. as manager of a young export company.

Ronald is a responsible, focused person with negotiating power and with very clear objectives. Among his most relevant functions are:

• Finding adequate fruit suppliers

• Analysing the financial development.

• Coordinating the logistics of the export operation

• Managing the quality control team

His affable, respectful character combined with his clear and transparent communication at all levels, generates trust and constitutes another strength in executing his role.

On a personal level, he is a happily married man with three children and he values family life very much. He therefore likes to attend activities with his family and be present on special occasions.

Our stakeholders

Over the years, we have come to appreciate the importance of collaboration. As a leader in our industry, we engage with a variety of stakeholders in many ways. Producers form the foundation of our operations by supplying the products we sell. We depend on logistics service providers to market these products in other countries. Our employees keep daily operations running smoothly, ensuring everything functions effectively. Ultimately, our products reach our clients, who play a crucial role in our business. Rather than simply following industry trends, we strive to lead by actively seeking new partnerships to address sustainability concerns. This all happens under the guidance of our shareholders, including producer groups that are 43% co-owners of AgroFair.

Our clients

Happy clients indicate that business is thriving. We maintain strong relationships with our clients to address quality issues and logistical challenges and to explore new market opportunities. Our goal is to provide a specialized, flexible service that meets our clients’ unique needs.

Our suppliers

We work with suppliers worldwide throughout the year. We’ve built strong long-term relationships with a diverse group of suppliers through effective communication, mutual understanding, and trust. These strong relationships enable us to consistently receive high-quality products. Our relationship goes beyond business alone, as we also collaborate to tackle sustainability concerns. Due to these often enduring relationships, many suppliers feel to be ‘part of the AgroFair family’.

Shareholders

We hold an annual Shareholders’ Meeting to discuss our company’s current situation. The main topics of discussion include our commercial success and strong financial performance. We also take this opportunity to gather valuable feedback from our shareholders.

Logistics service providers

Managing the transportation of bananas from the fields to our clients is complex. Given the perishability of bananas, timing is essential. We rely heavily on sea freight companies, whose role is to collect containers at the producing country’s ports and efficiently deliver them to the ports closest to our clients.

Employees

We promote a positive work culture to keep our employees motivated and engaged. This approach has resulted in exceptionally low staff turnover, allowing us to build solid internal bonds and establish long-term external networks with our partners. Our team is diverse, with members based in the Netherlands and across more than five countries in Latin America.

Other stakeholders (certifiers, NGOs)

We’ve learned that our industry is complex and filled with interrelated challenges. To stay ahead, we collaborate with various stakeholders, including certification entities, research institutions, governments, NGOs, and more. A clear example is our active membership of the World Banana Forum from the start, a multi-stakeholder platform for the banana industry founded in 2009 that tackles the sector’s global challenges.

AgroFair’s employees

Sustainability policy

In recent years, the term sustainability has been used in many ways and with many meanings. It is essential to be clear about what sustainability means to us. We were founded to introduce the Fairtrade banana, a socially sustainable banana. Our ambition is to go even further and make the production and trade of fresh fruit increasingly sustainable, both socially and ecologically. We have therefore defined three areas of focus for each of the three Ps of People, Planet, and Profit. These three focus areas guide our efforts and those of our suppliers. Suppliers can draw inspiration from them, especially when selecting Fairtrade premium projects. The focus areas are connected to specific Sustainable Development Goals (SDGs). We aim to make our focus areas increasingly specific, measurable, acceptable, realistic, and time-bound (SMART).

People & Society

Our focus areas under People & Society are:

Safe and healthy work environment

This theme is at the heart of Fairtrade, of which AgroFair is the pioneer. Responsible handling of crop protection agents by providing and using personal protective equipment, securing machinery and equipment and creating a socially safe working environment, also for women and minorities, are important points. Child labour and forced labour are prohibited, and the protection of workers’ rights through good contracts, collective bargaining agreements, freedom of association and the provision of accident insurance and pension schemes are key

issues. Communities surrounding plantations must also be protected against the risks of pesticides.

Decent wages/incomeaccess to basic services

Another aspect closely linked to the Fairtrade concept is the payment of a decent wage and the provision of access to basic services, such as education and health care. Working towards a ‘living wage’ and ‘living income’ that covers basic needs is a key element. Achieving acceptable prices and a certain level of efficiency go hand in hand. In addition, the Fairtrade premium is meant to meet such needs and is important, especially in countries where the government does not provide these services sufficiently.

Protecting vulnerable groups

Vulnerable groups in the working environment must be protected. This specifically applies to women and girls, as well as the differently abled and ethnic minorities.

Planet & Ecology

Our focus areas under Planet & Ecology are:

Soil and biodiversity

Protecting and improving soil life has a high priority. Healthy soils are essential for the development of healthy roots, nutrient uptake of the banana plant and bunch weight. With healthy soils, the use of pesticides and fertilisers can be reduced. The banana plant will be stronger and more resistant to pests, diseases and stress. Healthy soils are also capable of absorbing more CO2 and storing it in the ground in a stable

manner. Many plantations are located close to the sea. Residues from pesticides and fertilizers must be prevented from disturbing the ecology of vulnerable coastal areas. Biodiversity on and around plantations must be strengthened. Water catchment areas are essential and must be protected. Natural biotopes must be protected, especially in vulnerable mountain landscapes.

Climate change adaptation

Banana producers suffer from climate change. Extreme events such as droughts, floods and hurricanes are becoming more frequent and severe. Changes in temperature and humidity can change habitats and pave the way for the migration or development of pests and diseases. Adapting production to changing conditions and mitigating the effects of climate change are key focal points. Banana production and trade also have an impact on climate change. Reducing CO2 emissions in the chain is an important goal. To be able to do so, we first need to evaluate the carbon footprint. Last year we made a start with that, and this year we continued together with a selection of producers from Peru, Ecuador, Panama, Nicaragua and the Dominican Republic.

Profit & Economy

Our focus areas under Profit & Economy are:

Maintaining and improving productivity and efficiency

Increasing the productivity of the plantations of small farmers is important. In this way, they can continue to earn a viable income and take part in international trade chains. Large retail companies can thus help

to combat poverty and contribute to Sustainable Development Goals that are important for producers, workers and their communities.

Responsible production

Production should be carried out responsibly, using resources as efficiently as possible, so that as little possible waste is used. Waste, such as plastic, must be properly disposed of and preferably recycled. Releasing pesticide residues into the environment must be prevented as much as possible. Food waste must be curbed.

Risks for supply chain continuity

Climate change and the incidence of diseases and pests such as Sigatoka and Fusarium TR4, can present considerable risks for both producers and AgroFair. Changing trade patterns, such as the stagnating growth of Fairtrade and organic banana market segments, also pose a risk. Targeted actions can help make these risks manageable.

Sustainable organisation & financial results

To achieve their social, environmental and economic goals, organisations need to be effective and efficient. Good governance, and sensible and efficient economic management are prerequisites for a sustainable existence. In cooperatives, good governance and supervision, increased transparency and reduced corruption are very important. Where applicable, we pay national taxes due correctly and on time, thus contributing to the development of our communities.

Principles & goals

PRINCIPLES & GOALS

PEOPLE & SOCIETY

PROFIT & ECONOMY

PLANET & ECOLOGY

Circular waste management Responsible chemicals

A changing landscape and new opportunities for sustainability reporting

What is double materiality analysis? On the one hand, it is about the social and environmental impact of a company’s operations on the stakeholders in the value chain. On the other hand, it is about the financial impact of sustainability issues on the financial result of the company. When we talk about financial impact, it is primarily about staying in the market and continuing to sell bananas, including when the circumstances and context change.

The regulations regarding the environmental and social sustainability of corporations have recently been tightened, especially in the European Union. For AgroFair and its producers these are -albeit indirectlyalso of great importance, both as a challenge and as an opportunity to better position themselves in the market. In short, it concerns the following legislation.

The Corporate Sustainability Reporting Directive (CSRD) on how to report on sustainability issues: Environment, Social Dimension, Management / Governance (ESG), is effective from January 2024. Large companies must report on this from 2025 onwards. For medium-sized companies like AgroFair, reporting under these rules is still voluntary, until further notice.

For reporting purposes, the EU has developed detailed European Sustainability Reporting Standards (ESRS) on this ESG performance, which can be summarised as follows:

• reporting on the Social impact, covering four themes (own staff, workers in the supply chain, affected communities, consumers and final users);

• reporting on the Governance/management system.

A total of ten main themes. Just ‘storytelling’ is not enough. Companies should disclose verifiable data and report it along with their annual financial reports.

The Corporate Sustainability Due Diligence Directive (CSDDD) on environmental and human rights, a law approved in May 2024 by the European Parliament, goes a lot further. Its implementation is scheduled for 2027. Large companies must not only report on their sustainability policy; they must also act, that is: investigate, prevent, diminish and mitigate their environmental and social impacts in their supply chains. And among other things, they should have a strategy to be carbon neutral by 2050.

These regulations of the European Union mentioned above only apply to large companies for now, and not (yet) to AgroFair. But AgroFair is part of trade chains with supermarkets in Europe, and these do fall under these regulations. For reporting on their supply chains, they probably will turn to their suppliers, including AgroFair. In that case, apart from supplying goodquality bananas, providing reliable data will become increasingly important. If supermarkets are faced with the choice of buying bananas from importers who can provide the data they need, or from importers who cannot, they will prefer the former. Many aspects will be covered by certifications, but there are also issues beyond that, such as the carbon

• reporting on the Environmental impact, covering five themes (climate change, pollution, water and marine resources, biodiversity and ecosystems, resource use and circular economy);

footprint, sustainable waste management, biodiversity, social projects financed by the Fairtrade premium, and so on. Together with producers, AgroFair can distinguish itself in these areas and keep getting better. Sustainability, and the ability to report credibly on it, will become more important for competitiveness. Fairtrade International and the Latin American organisation of Fairtrade producers and workers CLAC support these legislations, but at the same time recognise the challenges involved, especially for small farmers. Where possible, AgroFair will support its producers to face these challenges.

Food Retail Sustainability Trends 2024

In today’s business landscape, sustainability has become a critical consideration, including in food retail. Companies face growing pressure to address their environmental and social responsibilities. They must now balance consumer expectations, regulatory requirements, and the need for resilient and responsible supply chains.

With the ever growing focus on sustainability, AgroFair has thoroughly investigated significant trends impacting the European (EU) food retail sector. These trends include adopting omnichannel strategies, an increased emphasis on human rights, and urgently addressing climate change.

Through our extensive analysis of more than 50 major European food retailers’ Sustainability Reports from 2015-2024 using advanced Artificial Intelligence software R, we have gained profound insights into emerging trends. This comprehensive research enhances our understanding of customer demands and allows us to provide valuable analysis in this rapidly evolving market. Additionally, we have aligned each trend with the relevant Sustainable Development Goals (SDGs) to provide a clearer framework for categorizing and understanding these developments.

Topic 1: Business Model and Economy

1) Omnichannel Strategies

Omnichannel strategies integrate multiple shopping channels, such as online combined with home delivery, in-store, and mobile, to provide a seamless and unified customer experience. Since the COVID-19

pandemic, supermarkets have increasingly adopted these channels, expanding their online presence significantly. In Europe, this market is projected to grow at an annual rate of 10.49%, reaching €143.60bn by 2029.

2) Product Innovation

The introduction of new and improved products to meet customer needs has increased in the European food retail sector. Supermarkets are promoting healthier eating by offering more varieties of organic foods, (frozen) fruits and vegetables, lactose-free, and vegan options. Additionally, meal-kit plans at reasonable prices are available, encouraging healthier eating habits among European customers.

Topic 2: People

1)

Human Rights

European food retailers are increasingly prioritizing human rights by working towards reducing the gap between wages, maintaining healthy work environments, and promote practices free of harmful pesticides. These efforts are aimed at upholding dignity and respect for all workers, promoting fairness, and ensuring safer conditions in the food supply chain.

2) Community Engagement

Community engagement among European food retailers includes contributions to food banks and local food programs. These initiatives are vital in addressing food insecurity and supporting the communities they serve. By actively participating in these efforts, retailers demonstrate their commitment to social responsibility and community welfare.

3) Support Local Farmers

Supporting local farmers has become a key focus for European food retailers, who are sourcing produce directly from local farms and ensuring fair remuneration. This approach not only promotes sustainable agriculture but also strengthens local economies. By prioritizing local suppliers, retailers contribute to the vitality and resilience of regional farming communities.

Topic 3: Planet Climate Change

Europe annually generates 58 million tons of food waste and 188.7 kg of packaging waste (19% plastic) per inhabitant (Statista, 2024). This significant issue has led the EU to implement regulations targeting the food retail sector. Consequently, supermarkets are adopting strategies to cut food and plastic waste and reduce carbon emissions. These include recycling programs, sustainable packaging solutions, food donations, and discounting near-expiry items. Retail stores are also adopting environmentally friendly practices to reduce their energy and water footprint for heating, cooling, and refrigeration which are concerns of climate change; a warmer planet, rising oceans, deforestation, and such. Additionally, supermarkets are focusing on sustainable logistics by using electric vehicles and by optimising their delivery routes to ensure responsible fuel consumption and to reduce overall carbon emissions.

Product Certification

In response to the pressing issue of climate change and stringent European regulations, supermarkets are increasingly prioritising sustainable practices to contribute to a cleaner planet. They are also

promoting and making available organic and certified food products, such as those from Rainforest Alliance, Fairtrade, Marine Stewardship Council and more, to meet the growing customer demand for these environmentally friendly options.

Topic 4:

Communicating Sustainability to Customers

Sustainability Reports

Sustainability reports offer clear insights into a company’s actions, policies, and performance regarding sustainability, social responsibility, and ethical business practices. Customer awareness of product quality, freshness, and safety has increased since the COVID-19 pandemic in 2020. Consequently, more companies are publishing sustainability reports, often every one to two years.

These reports cover successes, challenges, and areas of improvement. The Corporate Sustainability Due Diligence Directive (CSDDD), adopted by the European Parliament on 24 of April 2024, mandates all large companies to carry out human rights’ and environmental assessments in their supply chains. And according to the Corporate Sustainability Reporting Directive (CSRD) adopted in January 2023, they should report on sustainability based on transparency and accountability as from 2025 onwards. However, food retailers show varying levels of commitment and success in their sustainability efforts, underscoring the importance of these reports in understanding current and future trends in Europe’s food retail sector.

AgroFair Focus

At AgroFair, sustainability is our core mission and it’s driving our commitment to provide Fairtrade bananas. As AgroFair was established to introduce Fairtrade

bananas, this principle remains at the heart of our company. We are dedicated to the planet, its people, and the profitable (profit) cultivation and trade of bananas—our three main sustainability concerns and our business focus.

We prioritise a fair income and human rights for farmers and workers throughout our operations. Our commitment to sustainability includes actively seeking ways to reduce plastic and waste pollution, mitigating climate change, and minimizing our carbon footprint. Each year, we deliver a Sustainability Report to transparently communicate our successes and challenges to our stakeholders.

Materiality topic results

People & Society Planet & Ecology Profit & Economy

OUR SUPPLIERS

Social Goals:

1. Health

2. Education

4. Training

5. Gender equality

6. Poverty inequality

8. Family violence

OUR CLIENTS

• Supplier social compliance

• Community support

• Healthy products

• Employees & diversity

• Local embedding

OUR SUPPLIERS

Environmental Goals:

3. Waste management

4. Reforestation natural resources

6. Solar panels

7. Water

7. Soil health

8. Climate change

9. Pests & diseases

9. Tropical Race 4

OUR CLIENTS

• Plastic & waste

• Energy efficiency

• GHG emissions

• Climate change & biodiversity

Previous year, a sample of 10 producer organisations or companies (suppliers) sent a presentation on their main concerns, statements and concrete projects or initiatives in each of the three focus areas; also related to the SDG. We then selected a series of development items frequently mentioned (for example Health, Climate change ...), and counted how many organisations mentioned this as one of

OUR SUPPLIERS

Economic Goals:

4. Governence incidence alliances

7. Productivity quality

8. Production cost low prices

9. Employment

9. Alternatives processing

OUR CLIENTS

• GRI reporting

• Sustainable products

• Sustainability focus

the items important to them. Then we applied a ranking. Mentioned by 10 organisations (all): ranking is 1. Mentioned by 9 organisations: ranking is 2. Mentioned by 8 organisations: ranking is 3. Etc. When only 2 organisations mentioned an item, ranking is 9. The ranking thus reflects the relative importance of the items for the 10 organisations or companies.

People & Society

Our commitment to People & Society and our dedication to addressing social issues in the banana industry has been long and steady. While Fairtrade laid the groundwork for our company, we have strived to exceed these standards in our operations. We focus on providing a safe and healthy work environment, fair wages, and protecting vulnerable groups. Behind each piece of fruit are hundreds of producers, workers, and their families who work tirelessly to meet their needs. As a socially responsible company, it is our duty to address their main issues through our operations. We have adopted the relevant provisions of the International Labour Organization (ILO) conventions to ensure international labour standards and our internal sustainability policy.

In this section, we combine inspiring stories, critical opinions, investments made by our producers with the Fairtrade Premium and international forums to present the effects of our work on People & Society.

We also share inspiring stories online. Check out our Youtube channel AgroFair Benelux. For example our video “Viajando hacia el banano de Comercio Justo” and “Perú con AgroFair”, with an impression of the Fairtrade and organic banana cooperatives we work with. Or our video “Visitemos nuestras cooperativas bananeras en Valle del Chira, Perú”, a video report of a visit we made last November (2023) to our banana producers in Peru. Follow our experiences and see how bananas are produced and packed, how we transform plastic waste into corner boards, how we experiment with organic fertilisers and conservation techniques, so that healthy organic bananas reach us in the best possible conditions.

“My name is Fatima Zepeda. I am 43 years old and have been working at Finca Coquimba for 11 years. I have a child of school age and thanks to the Fairtrade Premium, I can buy all the necessary things for my son to prepare him for school. For me, it is a big help because I no longer have to pay this expense myself and I can therefore meet other needs. I am grateful for all the benefits provided”. Fatima Zepeda.

People & Society projects – some examples

MARPLANTIS ECUADOR

Marplantis has used its Fairtrade Premium to support its workers in their education by providing scholarships, school materials for students, and introductory computation courses for professional development. In addition, a social fund was established to support people in a fragile health condition. Support was also provided to several people whose homes had been severely damaged by a storm.

COOBANA - PANAMA

COOBANA, a long-term partner of AgroFair, has remained a strong leader and example for the industry. Despite the odds, they have committed to future generations by setting up scholarship programmes (See page 29). In addition, they support a local institution that addresses nutrition among children in the region. More than 90 families benefit from this support.

COQUIMBA NICARAGUA

COQUIMBA, a banana exporter, respects the quality of life of its producers. They believe that their producers should have a decent quality of life, and they use the Fairtrade Premium to provide basic health care, school materials for the younger generation, building materials to improve their homes, and household appliances.

AGRONOR PERU

AGRONOR is a family business with a banana plantation of 80 ha. In 2024, the 58 workers organised in the workers’ association ASOTRADA, benefited from the Fairtrade Premium of USD 135 thousand. 77% of the Premium went to improving housing after hurricane Yaku, and the rest was spent on a Christmas basket and school materials for their children. Four young adults received scholarships for higher education.

APBOSMAM PERU

The APBOSMAM cooperative spent USD 280 thousand Fairtrade Premium in 2023. In terms of social projects, they shared in the cost of funerals of members’ relatives, preventive medical care and social insurance for workers.

APPBOSA PERU

At APPBOSA, the Premium was used to provided support for surgical operations for cooperative members and their families, funerals of members’ relatives, and preventive health care.

ASOGUABO ECUADOR

By 2023, ASOGUABO had a lot of Fairtrade Premium to spend: USD 1.2 million. Over half was invested in social projects, the most important of which were: social insurance for workers, preventive health campaigns for members and workers and in the polyclinic, health care insurance for producers, support at funerals, a Christmas basket, support to local schools and school bonuses at the start of the school year.

CAIPSA NICARAGUA

Unfortunately, the volume of Fairtrade certified bananas is not that large at CAIPSA, otherwise they could have done much more. Still, they were able to provide the workers with a modest sum to buy building materials or electrical appliances to slightly improve their homes and comfort. They also received a school bonus at the beginning of the school year.

FRUECODOM DOMINICAN REPUBLIC

The banana company FRUECODOM invested the Fairtrade Premium in baskets with useful products for pregnant workers or their spouses and for the babies’ first weeks. The grant also financed technical courses run by a local vocational training institute.

Supermarkets, Don’t make a Fuss - open your shelves to Fairtrade bananas

On May 6, 2024, Prof. Ruerd Ruben published an opinion piece in the ‘Volkskrant’ newspaper titled “Fairtrade products do not yet lead to a living wage for farmers.” The article mostly focused on coffee and cocoa, but what about bananas?

The European Parliament adopted the Corporate Sustainability Due Diligence Directive (CSDDD) in April 2024. Within a few years, supermarkets must start disclosing the social and environmental impact of their business activities and supply chains, considering social rights such as the right to a living wage and income.

Implementing a living wage and income is a tricky issue. Supermarkets and importers sign annual contracts with several banana producers, and many producers supply more than one supermarket at a time. So far, only a handful of supermarkets in the Netherlands, Germany, the United Kingdom, and Belgium have committed to the “living wage” concept. They promised to make efforts to gradually reduce the gap between what is paid and what is defined as a “living wage”. What should the banana producers do? Partly pay a living wage, partly not? Do it one year, but not the next? In addition, producers are asked to fill out complicated and large “salarymatrix” spreadsheets that must consider monthly, daily, and piece-rate wages, changing roles, cash and in-kind remuneration (such as providing lunch in the canteen, which is also considered income), seasonal work, etc. In many cases, there is a lack of

“shared responsibility” and commitment to adjust the purchase price of bananas, which for years has lagged behind the increased costs of fertilizers, pesticides, transportation and energy.

Mandatory due diligence is coming, and some supermarkets reluctantly embrace the “living wage/ income” concept. At the same time, the growth of the Fairtrade banana segment in the EU banana market has reached a plateau in recent years. This has prompted Fairtrade International to declare a moratorium. No more banana producers will be certified for the next two years; otherwise, the market share of each producer will become too small to generate real benefits. However, studies in several countries have shown that the gap between what is paid and the “living wage” and “living income” is smallest with Fairtrade certified bananas, thanks to the guaranteed minimum price.

How can this paradox be explained? The answer is in the purchasing policies of many supermarkets. They, not consumers, hold the key to increasing the supply of Fairtrade bananas. Leading supermarkets across countries can choose to buy only bananas at the Fairtrade minimum price; a plea echoed over and over by the Ministers of Agriculture and branch organisations in banana countries. Better yet, they can switch to Fairtrade certified bananas entirely, preferably with multi-year contracts that include environmental costs. This would create a “level playing field” across the European market and pave the way for a living wage and living income for banana producers.

Instead of bureaucratic exercises to verify if living

wages are paid, ample room should be given to trade unions and collective bargaining agreements. By doing so, they can help ensure fair wages for banana producers. Supermarkets would do well not to stunt with cheap bananas and instead distinguish themselves by making the banana trade fairer and more sustainable. Instead of numerous talks and conferences and studies about living wages, living income ... don’t make a fuss, the solution is right in front of you! Just switch to Fairtrade bananas, organic or conventional. This will also make it a lot easier to meet the requirements of due diligence - at least for bananas.

Fairtrade Banana Forum in Colombia

Last May, our colleague Linett Duque traveled to Santa Marta in Colombia to participate in the IV Fairtrade Banana Forum. This event is organised by the Latin American and Caribbean Coordinator of Small Fairtrade Producers and Workers (CLAC) and was attended by producers, workers, clients, importers, NGOs, and international experts from the banana value chain and the Fairtrade industry.

The objective of the event was to promote a space for dialogue and exchange on trends, perspectives and challenges in the global banana and Fairtrade markets. In addition, participants discussed the challenges, successful practices and commercial, productive, social and environmental commitments of the sector.

The forum had a rightful agenda with themes that involved many actors in the industry. Other topics addressed were the market and sustainability perspectives, shared responsibility along the production chain, the relevance of sustainable prices, and European Union regulations such as the Due Diligence Directive on Corporate Sustainability.

In her opening statement to the forum, Marike de Peña, president of CLAC’s Board of Directors and Banana Network, emphasized that Fairtrade envisions a world in which producers and workers can live from their work with dignity, develop their potential and decide on their future.

“For 30 years Fairtrade has recognised the great power of trade to build dignified living conditions and social welfare. Small Fairtrade producers and workers are witnesses to this potential and have seen

the change. Today, many have their own homes, have access to health services, and their children can study and progress in their lives,” the president of CLAC stated.

On the other hand, Henry Fernandez, member of the CLAC Banana Network, said that “the Fairtrade Banana Forum provides the opportunity to learn, share and expose the problems of banana production in the production areas of different countries, and the new requirements of the target markets, in order to adapt production and marketing strategies to achieve a dignified life”.

Finally, Marike finished by saying that even though Fairtrade as a movement has many reasons to celebrate, it has just as many to reflect. Issues such as the Sustainable Development Goals (SDGs), the farmto-table strategy, the corporate responsibility directive, the commitments of retail chains to income and living wages clearly indicate the world we want to live in. All these issues are important and we must continue to work on them.

Fourth Global Conference of the World Banana Forum

in Rome

The Fourth Global Conference of the World Banana Forum, the banana industry’s multi-stakeholder platform, took place in Rome on the 12th and 13th March. AgroFair has been an active member since its inception in December 2009. Members include larger and smaller banana companies, importers, producer organisations, NGOs, banana country governments, research institutes, certification organisations, and a few supermarkets. The World Banana Forum deals with a multitude of topics relevant to the future resilience and sustainability of the banana industry.

On the agenda of the two-day conference were a few key themes, such as the future of the banana industry, climate change and environmental sustainability, more equitable revenue sharing among the different actors of the value chain, working conditions, the specific challenges for small producers, Fusarium Tropical

race 4, the multitude of certifications and related costs, and changing regulations in the European market. Three ‘side-events’ on the 11th and 14th March allowed for deeper discussions on gender equality, Fusarium Tropical Race 4, and ‘living wage’ and ‘living income’. Most topics were addressed through speakers who gave a ‘keynote’ presentation followed by a panel discussion and discussion with the attendees. From the panel discussions numerous recommendations arose that are important for the agenda of the World Banana Forum in the coming years. Many panels expressed that supermarkets should take on a greater degree of co-responsibility for making production more sustainable, among other things, by adjusting their purchasing policies, longterm commitment and above all, better dialogue and better prices. A new topic discussed was the increasing number of certifications that often overlap but require producers to spend a lot of time and audit costs.

A working group will now investigate whether all this can be harmonized and simplified. At the end of the conference, criteria for a new Steering Committee of the World Banana Forum were outlined. The Steering Committee meets twice a year, mostly virtually, and AgroFair is a member. Detailed information on the conference, the full recording and report, can be found on:

www.fao.org/world-banana-forum/about-the-forum/ fourth-conference/en/.

Fairtrade Impact

A good story to share

FIDEL ENRIQUE JIMENEZ BEITIA– COOBANA (26 years old)

Dinora Beita, a dedicated single mother and a member of COOBANA, has been working at banana packing stations for over 15 years. Thanks to her association with COOBANA, her son, Fidel Enrique, was able to benefit from the Fairtrade Scholarship Program, which covered his entire High School and University education. Fidel, chosen for his academic excellence, earned a bachelor’s degree in Agricultural Engineering from EARTH University in Costa Rica in 2019. But his academic journey didn’t stop there. He continued to pursue a master’s degree in Sustainable Agriculture at the University of Zamorano in Honduras (2020 - 2021), demonstrating his unwavering determination.

During his time as a student, Fidel noticed the importance of English for his professional development. So, he took several courses to learn the language. In addition, Fidel spent some time doing an internship in Brazil, where he also learned the local language. In other words, Fidel Enrique is now trilingual, speaking Spanish, English, and Portuguese. Thanks to the high quality of his graduation project, Fidel Enrique’s work has gained international recognition. His project, ‘Genetic Improvement and Epidemiology of Maize’, was noticed by the Department of Botany and Plant Pathology at Purdue University in Indiana, USA. They were so impressed that they decided to execute the project under Fidel’s supervision, a testament to the global impact of Fairtrade initiatives.

Currently, Fidel Enrique is collaborating on different projects in remote sensing and photogrammetry in agriculture at Purdue University. Although his education career required much effort, the Fairtrade Scholarship Program gave him the start he needed. This shows the importance and impact Fairtrade can have on local communities!

Planet & Ecology

Although many still believe that climate change is a thing of the future, the reality is that the effects of climate change can already be felt throughout the world. Instead of addressing climate change from a preventative perspective, it is time to shift to include adaptation measures in our practices.

As mentioned in the introduction, we are far from achieving the SDGs, many of which refer to climate change. Delaying drastic actions will only exacerbate the adverse effects of climate change. As a social enterprise, a business that operates for the betterment of society, we do not deny our impact but embrace it for the better cause.

We trade, which limits our direct environmental impact as we are not involved in production. However, it is our policy to care about our indirect environmental impact. We might be a single player in the chain, but we believe in an integrated sustainability approach. That is why Planet & Ecology is a relevant part of our sustainability policy.

In the following sections, we will present several initiatives by our producers, an update on our carbon footprint calculations, our recycling plant in Peru, and an innovative adaption measure in Panama that seems ‘unthinkable’.

Planet & Ecology projects – some examples

COOBANA PANAMA

Sea turtles represent a precious asset of coastal marine biodiversity, so COOBANA, R.L. joined efforts and is working with community groups to conserve sea turtle populations and habitats. The cooperative participates in beach cleaning activities and night patrols on the nesting beach in the San San-pond Sak wetland, which extends approximately 5 km. The initiative seeks to ensure the protection of the nests and increase their survival, since this beach is the target of turtle egg plundering. COOBANA also provides environmental education to their members, workers and communities.

ASOGUABO ECUADOR

Responsible production entails more than taking good care of the banana plants; it also involves proper waste management. To tackle plastic pollution in the banana industry, ASOGUABO collects plastic waste among its producers to ensure it gets recycled into other products, extending the lifetime of the plastic. In addition, ASOGUABO has an agreement with an institutional cooperation for the protection and conservation of the hydrographic basins of the province of El Oro called “Sembrando Vidas” (Sowing Lives). They want to achieve this by, among other things, reforestation and purchasing agricultural land to set up a plant nursery.

AGRONOR PERU

A large part of AGRONOR’s production costs is the energy needed to keep the electric irrigation pumps running. Moreover, since this energy is obtained from non-renewable sources, this also contributes to a relatively high carbon footprint. But this is about to change. With support from Peru’s PRO INNOVATE programme, AGRONOR will invest in its own generation of renewable energy in the coming years. In addition, together with AgroFair, AGRONOR will participate in a trial of bio-based and biodegradable bunch bags and packaging bags.

APBOSMAM

APBOSMAM spent part of the Fairtrade Premium on making its own biological insecticides to control red rust banana thrips. In addition, an extra three hundred fruit trees were planted at access roads and at the logistics centres.

Carbon footprint the consequences of climate change

Climate change - unfortunately, there is no good news to report here. The year 2023 will go down in history as the warmest year ever, in which numerous records were broken. As things stand, 2024 will be no different.

Climate change is caused by greenhouse gases, the most important of which are carbon dioxide (CO2), methane (CH4) and nitrous oxide (N2O). The sun gives off energy, which is absorbed by the oceans (90%), land (5%), the atmosphere (1%), ice caps at the north and south poles and glaciers (5%). In a balanced climate, the Earth gives off heat to the universe, but due to the greenhouse effect of these gases, more energy comes in than is given off. Therefore, the Earth’s average temperature is rising, and what is particularly worrying, according to climate scientists, is that the temperature rise is not gradual, but has accelerated in recent years. This is most evident in the accelerated warming of the oceans, melting of the ice caps and rise in sea levels. Only when the energy balance recovers will climate change stop. And that can only be achieved by drastically reducing greenhouse gas emissions.

Agriculture, including the banana export sector, contributes to greenhouse gas emissions, in production and overseas transport. There are ways to reduce this contribution, and the first step is to make these emissions transparent. As AgroFair, we have therefore spent two years mapping these emissions. This year, seven producers participated with a total of

11 plantations, from all five countries where AgroFair buys bananas: Peru, Ecuador, Panama, Nicaragua and the Dominican Republic. They include family farms and cooperatives of small producers, dry and wet climate zones, conventional and organic bananas. This aptly reflects the diversity of the bananas’ origin. The results can be found in the attached table. The main factors that are contributing to the climate footprint are the use of fertilisers, fossil fuel for transport and stationary engines (pumps), and electricity from non-renewable sources (fossil energy). However, the situation is quite different for each producer, and so are the possible measures that can be taken to reduce the climate footprint.

Meanwhile, we should also not ignore the impact of climate change on the banana sector, and how important it is for producers to adapt to it. Compared to other agricultural sectors, the banana sector’s contribution to climate change is relatively modest, but the effects are increasingly being felt. In Peru, there was Hurricane Yaku in March 2023, which was accompanied by flooding. There also was a drought, which meant insufficient water in the Poechos reservoir. As a result, irrigation probably will be restricted later this year, which will affect the banana plantations. In Panama, a kind of sunscreen had to be applied to the banana leaves to protect them from burning due to the heat. It is still unclear whether the increasing pressure of certain pests, such as the mealybug in Panama, banana rust mite in the Dominican Republic, and crown rot in Peru, have anything to do with climate change.

In the long run, it would be great to be able to market a truly climate-neutral banana by reducing emissions as much as possible and sequestering carbon from the

atmosphere in permanent vegetation (hedges, trees, forests, ground covers) and in soils. Moreover, studies show that biodiversity and healthy soils, composting and integrated pest management not only reduce emissions but are also measures that increase the resilience of banana plantations to climate shocks, extreme weather (drought, precipitation) and even to certain pests and diseases. So, it’s a win-win.

Next year, we hope to actively involve even more producers in evaluating their climate footprint. To this end, the tool developed by the World Banana Forum / FAO is indispensable. What would help is that all producers -in addition to their financial bookkeepingsystematically start keeping ‘carbon accounts’, especially on the use of fertilisers, fossil fuels and electrical energy.

Rethinking the use of plastics in the banana cultivation and trade

The recycling factories

The 31th December 2023 marked the official end of the ‘From bunch bags to corner boards - recycling banana plastic’ project. For 4 years we supported this project with generous grants from the Netherlands’ Enterprise Agency RVO and the Luxembourg’s Cactus supermarket. Recycling facilities were set up in Peru and in the Dominican Republic. In Peru, the project has been reasonably successful (not without difficulties). The company ECOBAN that runs the plant exists for over two years now, producing around 21 thousand corner boards a month. A loan from AgroFair enabled the purchase of a second agglomerator and a shredder. With a second agglomerator, the plant is less vulnerable and can process more plastic. The shredder also allows other types of plastic to be ground and mixed with the shredded plastic from the agglomerator. The result is a spectacular improvement in the quality of the corner board: it is now thinner, with a sharp profile, and is very hard and consistent. In the Dominican Republic, it was not possible to make corner boards of acceptable consistency even after many experiments and mixing with pellets of HDPE (High Density Polyethylene). This due to the type of very soft plastic used for the bunch bags (LLDPELinear Low Density Polyethylene). We are now looking for funds together with project partner BANELINO, to adapt the machines with modest investments. Instead of producing corner boards the idea is to make posts and planks from ‘plastic wood’, by pouring liquid plastic into moulds. ‘Plastic wood’ has many outdoor applications: roadside bollards, fencing, urbane

furniture, waste bins, scaffolding, terraces ... It requires no maintenance, has a very long lifespan, and can be recycled again if necessary.

Trials with bio-based and biodegradable plastics

We are also continuing trials with bio-based and biodegradable plastic, in collaboration with Triple Benefit (which helped us with technical assistance in the recycling projects). Together with BIOTEC in Germany, one of the largest factories in Europe for making biodegradable plastic, and the banana company AGRONOR in Peru, supplier of AgroFair, we are going to do trials with biodegradable bunch bags as well as with biodegradable packaging bags in the banana box made by BIOTEC. For this project, Triple Benefit managed to get funding from the EU’s Interreg programme. We may also be able to carry out trials in Costa Rica, and perhaps in the Dominican Republic.

Plastic use in the banana sector on the agenda of the World Banana Forum

Final negotiations on an international legally binding treaty on reducing plastic pollution led by the United Nations Environment Programme (UNEP) are taking place at the end of this year. As a part of this, FAO has decided to work towards a Voluntary Code of Conduct (VCoC) for more sustainable use of plastic in the agricultural sector. But this Code of Conduct is very comprehensive. It includes agriculture, horticulture, livestock, forestry, fisheries and aquaculture. The use of plastic in the banana sector is fairly straightforward. Most plastic used are bunch bags, packing bags for boxed bananas, plastic packaging for inputs (bags for fertilizers, containers for pesticides) and nylon ropes which are used to shoring up banana plants. With input from AgroFair, a ‘white paper’ has been drafted and a survey on plastic use in the banana sector is ready to be conducted among different types of stakeholders. Hopefully, this will contribute to a better picture of the extent of plastic use in the banana

sector and how plastic waste is handled. Maybe then steps can be taken to reduce the harmful impact of this use, and perhaps the World Banana Forum could come up with its own code of conduct for the banana sector.

Climate change stress & its negative impact on banana production

As the impact of climate change increases every year, the agricultural sector, including banana production, is under significant strain. Bananas, like many other crops in tropical regions, are experiencing plant stress and other climate-related challenges.

An example of climate stress can be found in the region of Changuinola, Panama. Bananas have been grown in Changuinola for many decades. In the past, the region had the perfect climate conditions for it throughout the year regarding sun hours, rain, and temperature. However, in recent years, a new weather pattern was identified in the summertime due to climate change. The region is now suffering from prolonged droughts and increasing daytime temperatures. As a result, banana plants are undergoing stress, which decreases productivity due to the plants’ limited photosynthetic capacity. Moreover, stressed plants are more susceptible to the pests and diseases that thrive in warmer temperatures. Continuous monitoring of weather patterns has become a year-round necessity. The once reliable climate patterns are now unpredictable, which directly influences the growth of banana plants. Producers must adapt to these new weather patterns, making long-term planning increasingly difficult.

Producers are forced to adapt to the extreme temperatures during the summer. Agricultural programs have now incorporated foliar products to protect the leaves from the sun’s rays and reduce the impact of climatic stress. In other words, banana plants

need sunscreen protection to thrive in the summer. These products or sunscreens are based on zinc, silicon, calcium, and di-carboxylic acid. The sunscreens are used to stimulate physiological processes, strengthen leaf cells, and improve resistance mechanisms against damage caused by intensive sun rays.

Measures to protect the bunch include using plastic bags with high levels of opacity to prevent the sun’s rays directly burning the fruit.

These adaptation strategies, while adding to the producers’ workload and costs, are crucial for protecting banana plants from the stress of direct solar radiation. They are essential for maintaining plant health, optimizing production, and ensuring the strength of the fruit. Without these measures, productivity would drastically decrease, and the harvested bananas would have sensitive skin, leading to more mechanical damage and, therefore, losses. The sustainability of banana production and quality will continue to be a significant challenge for growers each year.

Economic Sustainability

Every year has its challenges, and 2023 was not an exception. Low fertilizer inputs during the COVID era combined with weather patterns negatively affected the banana plants’ strengths. In 2023, the number of quality problems along the chain increased dramatically. Once the quality of the fruit stabilized, we were confronted with very low production during the last months of the year.

Once a container arrives at the destination, it undergoes a quality inspection. Depending on the result, the container might be headed to a different destination. A green quality report means the fruit can be delivered to the client without inconvenience. An orange quality report means the fruit is accepted with reservation. It can still be delivered to the client, but a quality claim can be submitted. A red quality report means the fruit is unacceptable and cannot be delivered to the client.

If that happens, each box is inspected to preserve the bananas with the proper quality. Although we expect some quality issues each year, the number of containers with critical quality problems was abnormally high in 2023. Even if immediate action were to be taken at the packing level, the bananas still have to travel four weeks by ship. Once the quality was under control, a new challenge arose regarding volumes. We had hope for a year with high volumes. However, the volumes available were lower than expected. Countries like Peru and Ecuador produced very little during the last few months of the year. But it’s not all bad news. We reached our highest gross profit since we started out, and our contribution to the Fairtrade Premium increased compared to the previous year. The charts provide a snapshot of AgroFair’s financial situation.

Profit & Economy projects – some examples

ASOPORABAJU ECUADOR

ASOPROABAJU is a producer organisation located in Ecuador. In 2023, they started exporting fruit to international markets directly. Although it has been a rough path, we are glad to have them among our suppliers of both conventional Fairtrade, organic and organic Fairtrade bananas. They needed separate fumigation/spraying equipment for their conventional and organic plants to take care of the organic integrity of all the association’s farms. The organisation opted to purchase a drone to spray all the producers in the group and avoid contamination from using contaminated equipment.

APBOSMAM PERU

After a few years, we resume our relationship with APBOSMAM in Peru. Using their Fairtrade Premium, APBOSMAM decided to invest in their infrastructure. They laid approximately 9 km of cableway, allowing for a more efficient transport of bananas from the field to the packing station. In addition, they invested in the construction and improvement of the packing stations themselves, including packaging material (boxes and pallets), and improvement of access roads. Thinking about their employees, they included suitable sanitation facilities in the new packing stations. In addition, the Fairtrade Premium was used to pay the high costs of external audits for several certifications and for organic fertilizers.

APPBOSA PERU

The APPBOSA Cooperative in Peru utilized a portion of its Fairtrade Premium to undertake crucial community infrastructure improvements. This included the cleaning and clearing of drainage canals, which helps prevent flooding and ensures better irrigation for local agriculture. Additionally, they invested in the maintenance and repair of access roads, improving transportation routes for both agricultural products and community members.

ASOGUABO ECUADOR

In 2023 and again in 2024, ASOGUABO invested a considerable amount of the Fairtrade Premium in their main natural capital: soil health and the production of beneficial microorganisms, such as Trichoderma, which protects and strengthens the root system of the banana plant. They also invested in improving packing stations, and, very important, in the construction of foot baths to support the implementation of preventive biosecurity measures against Fusarium Tropical Race 4, benefiting 119 producers.

Bananas: organic & organic Fairtrade

In the last few years, the market for organic and organic Fairtrade bananas has stagnated. In the past, both markets were steadily growing year to year. Although we strongly believe this is the way to a more sustainable industry, the market seems to be going in another direction.

On the bright side, prices in Europe for bananas in 2023 were record-breaking at the importer and consumer levels. Although this tends to be coupled with lower import volumes, this was not the case for 2023, as import volumes remained the same. When we dived into the niche markets, the development was somewhat different. On the downside, both the organic market and the organic Fairtrade markets reacted differently.

In 2023, the loss in market share of the organic segment can be attributed to many factors. The aftermath of the COVID era, in combination with climate change, resulted in a small volume of organic/ organic Fairtrade bananas. The volume loss can be seen in production graphics of Peru and the Dominican Republic, two of the largest organic banana producers. In addition, the quality of the fruit was extremely poor. We believe this to be a direct result of the low inputs used on farms due to the spikes in fertilizers and other products.

Organic Bananas - Peru

Export to all destinations

Organic Bananas - Dominican Republic

Organic Bananas - Dominican Republic

Imports in the EU27- estimates

Imports

source: TRACES, EUROSTAT, CIRAD

Low availability is one side of the story. By default, organic fruits are more expensive than conventional fruits. As a result of inflation, retail prices for both organic and conventional fruit increased, yet organic retail prices increased more, negatively affecting the demand for organic fruit. Producers could only partially benefit from better purchase prices, as the cost for inputs, fuels and labour also increased. The consumer price for other fruits and vegetables rose faster than that of bananas, which is still the cheapest fruit in supermarkets. Adjusted for inflation in recent years, the value of bananas has decreased over the past eight years, and price increases have only halted this loss of value. With the decreased demand for organic and Fairtrade bananas from Peru and the Dominican Republic, small producer organisations in particular are going through a very difficult time.

In Peru, the situation is aggravated by the progressive spread of Fusarium TR4, which has already pushed many producers back into poverty. The stagnation of the market for Fairtrade bananas has led Fairtrade International to declare a moratorium. To protect existing Fairtrade banana producers, no new Fairtrade certifications will be issued in a two-year period. At AgroFair, we are experiencing a market where demand/supply for fruit has been stable throughout the year 2024.

Organic Banana EU27 estimated Annual Supply in tonnes, source: CIRAD

Organic Banana EU27 estimated Annual Supply in tonnes, source: CIRAD

Organic Banana - EU27 Market Annual Growthrate

Organic Banana - EU27 Market Annual Growthrate

Source: Traces, CIRAD

Producers situation:

Price pressures from the market: push for lower prices

Fair Tax mark

We are proud to share that we once again obtained the Fair Tax Mark certification, which reaffirms our unwavering commitment to transparency and ethical tax practices. This achievement underscores AgroFair’s ongoing efforts to lead with integrity and uphold trust with its stakeholders, providing a sense of security.

Fusarium TR4 and resistant varieties in Peru

The advance of the fatal banana disease Fusarium wilt of banana, caused by the soil fungus Fusarium oxysporum f. sp. cubense, is worrying. Since 2018, the number of affected countries has risen from 16 to 23. In Colombia, the disease is slowly spreading. According to official data from the phytosanitary service SENASA, 535 infections had already been identified by the end of August in Peru. The actual number is probably much higher. Alarmingly, the disease has now also been identified at a considerable distance from the original infection in Chocán in the north-eastern Chira Valley, including south of the Chira River (which had so far acted as a natural barrier), and in the eastern part of the Chira Valley.

Biosecurity measures have not been able to stop the spread within and between countries. At best, they have only slowed it down. In Peru, the promotion of a territorial approach to overcome the high degree of fragmentation of banana plots, with the mapping project to support risk analysis initiated by AgroFair, has failed. In practice, although supported by many organisations, this approach proved too ambitious and complicated for the fragmented context and lacked strong local leadership and resources. Unfortunately, we must note that on-farm biosecurity measuresoutside the private sector plantations - are hardly taken. Given the small area of banana plots in Peru, it is impractical to adhere to the recommended destruction and quarantine guidelines of the regional phytosanitary organisation OIRSA. These guidelines would imply giving up almost the whole plot. SENASA only destroys plants with visible symptoms, and

not the plants in a surrounding buffer zone. The downside is that the effectiveness of these measures is questionable and TR4 spreads further in these plots and beyond.

Biosecurity measures should be maintained when switching to another crop, as the pathogen remains in the soil for decades and can continue to spread. But in reality, this does not happen. The irrigation system (flood irrigation) also contributes to the rapid spread, much like the flooding of the Chira River as a consequence of the Yaku storm in March 2023.

It is a matter of time before the disease will appear in all banana-producing countries; but this is a slow process and in the medium term there will be enough land to continue exporting the Cavendish banana. Since the doubtful effectiveness of exclusion of the pathogen via on-farm biosecurity measures, it is becoming increasingly clear that other options for sustaining the banana sector are gaining in importance: sustainable soil management, biodiversity, and most importantly, resistant varieties.

AgroFair started collaborating with the French research institution CIRAD and the Peruvian agrarian research institution INIA to set up trial plots later this year of seven varieties tested in contaminated soils in Australia. A first hurdle has been taken: the phytosanitary organisation SENASA has given permission to import planting material from France. The plan is to set up one trial plot at INIA’s experimental centre in Mallares; and another trial plot at a cooperative infected with TR4. One more challenge is finding additional funds (apart from cofounding of AgroFair) to complete the financing.

The trial will look at how these varieties behave in Peru’s soils and climate and will investigate its postharvest quality. Part of this is a taste test, as well as a simulation of sea transport at 13,5 °C. In total, these varieties will be tested during two cycles. Varieties that score well in terms of yield, taste and post-harvest quality are in principle candidates to be introduced to small producers for the national market and possibly also for export. Setting up trial plots is one thing, renovating hundreds of hectares of banana plantations is another, but that is of later concern.

TR4 Cases confirmed / month, 42 months, April 2021 - August 2024

Total: 535 cases

Bananas- From waste to puree

During the packaging of AgroFair bananas, the producers adhere to a strict selection process to ensure that the highest quality fruit reaches our clients. At the packing station, producers can deem bananas unsuitable for export due to scarring or other quality defects. If they were shipped and ripened, the defects would only get worse. As a result, the chance of rejection by AgroFair or final clients increases and that does not favor anybody. In Ecuador, AgroFair developed a sustainable solution for this stream of bananas instead of discarding them. The solution is simple: turn rejected bananas into banana puree. Instead of throwing them away or selling them at the local market against a much more unstable and often lower price, the producers have a guaranteed stable price for these rejected bananas.

Across many producers’ farms, producers sort out green bananas and collect them separately in large bags. These bags are then transported to the puree factory in Durán, near Guayaquil. At the factory, the bananas go through another selection process and are later ripened. Once the bananas reach the right conditions, skillful workers manually peel them. The peels are collected and used as cattle feed to avoid any waste. The bananas are mashed and aseptically packed under high pressure and temperature in large bulk packs of 250 or 1,000 kilograms. Roughly 2.4 kilograms of banana means 1 kilogram of puree. In other words, it’s a very concentrated product. The aseptic packaging in barrels preserves the banana puree for at least two years. Banana puree can be stored at ambient temperatures, meaning less energy is used during transportation and storage.

After production, we ship the puree to Rotterdam, just like many other containers with fresh fruit for AgroFair. Throughout Europe, banana puree is sold to various clients, most of them being processors with a private label or producers for large retailers. Although quite tasteful, banana puree itself is not a finished product. Its versatility is its strength. Banana puree is a blank canvas, ready to be used in different products and recipes. From baby food to pouches, smoothies, desserts, yogurts, and even cosmetics, the possibilities are endless.

AgroFair in South Korea

Although the global abnormal climate conditions are affecting the banana production, the import and consumption of bananas in South Korea remain substantial. In 2023, South Korea imported 303,448 tons. By June 2024, the import was already at 233,769 tons. Government policies on imported fruits caused the volume of banana imports to increase to an enormous quantity in 2024.

Importing organic bananas to South Korea is quite a rigorous process. First, they test over 300 chemical components, and 4% of the imported batch is visually inspected on-site. During this process, they examen the tip and crown parts with a magnifying glass. If they find any live insects or larvae, they conduct fumigation, disqualifying the bananas from being labeled organic. Further inspections are then carried out in a laboratory with samples from the batch. Despite these stringent conditions, AgroFair maintains a consistent and stable supply of organic bananas, demonstrating a higher success rate than global companies.

AgroFair supplies organic and Fairtrade bananas from the northern province of Piura, Peru, to South Korea. Although this constitutes less than 1% of the total supply, we have consistently provided these bananas for several years, which indicates the long-term relationship AgroFair maintains with both our suppliers and our customers. Especially in the first half of this year, AgroFair’s Fairtrade organic bananas were trialed for sale in supermarkets and online shops. Despite the lack of individual promotions or advertisements, many consumers became aware of Fairtrade bananas and validated their quality.

The results were satisfactory for everyone involved, confirming the potential and assurance that AgroFair’s bananas could be sold to general consumers. AgroFair South Korea now plans to introduce our bananas to even more consumers.

BRIEF NEWS

AGROFAIR TAKES PART IN THE ENERGY TRANSITION

HOT OFF THE PRESS:

In September, 200 solar panels were installed on the roof of AgroFair’s office. From now on, AgroFair’s office and storage, including cooling, will run on renewable energy.

NEW COOLING SYSTEM INSTALLED AT AGROFAIR’S WAREHOUSE

We have installed a highly efficient cooling system in our warehouse, which significantly enhances temperature management and energy use. The new system offers precise climate control, ensuring that products remain in optimal condition while reducing energy consumption by up to 70%.

AGROFAIR LATAM TEAM VISITS OUR OFFICE IN THE NETHERLANDS

Just like last year, we welcomed our Latin America team (Nicanor, Linett, Ronald and José, also known as the Fantastic Four) to the Netherlands in spring for a week-long visit. The team members engaged in strategic meetings, training sessions, and collaborative workshops aimed at strengthening ties and aligning goals for the upcoming year.

DEBUT AT FRUIT ATTRACTION BRAZIL

We participated in the Fruit Attraction Brazil fair for the first time. The event allowed the team to connect with industry leaders, network with potential partners, and gain insights into emerging market trends. Attending Fruit Attraction Brazil was a significant milestone for us, and it opened doors for exciting collaborations and strengthened our presence in the Latin American market.

TEAM TAKES TO THE WATER IN THE CITY OF DORDRECHT

Several colleagues organized a memorable team building activity on a boat in Dordrecht, offering a unique setting for socializing and bonding. Colleagues enjoyed a day cruising along the scenic waterways, sharing a meal onboard and engaging in meaningful conversations.

NEW APPOINTMENT: AGROFAIR WELCOMES

NEW COMMERCIAL MANAGER

We would like to welcome Eric Kemeling as our new Commercial Manager. With over 30 years of experience in the fresh food industry, Eric Kemeling brings a wealth of knowledge and expertise to our social enterprise.

AGROFAIR LATAM & TULIPÁN NARANJA LEAD

QUALITY CONFERENCE FOR PRODUCERS IN PERU

AgroFair LATAM & Tulipán Naranja organised a quality conference tailored for producers, before the ‘crown rot period’ in Sullana, Peru where they shared the best practices. The conference featured expert speakers, interactive workshops, and case studies designed to address key quality challenges.

FRESH PLAZA VISITED THE BANANA REGION IN PERU TRACEABILITY APP

Two years ago, with the future of small producers in mind, AgroFair developed an online and real-time application to support traceability and quality control. The app is mostly finished and we are now in the early implementation phase. We are now making minor adjustments to the app allowing better use. We expect the app to be fully operational, also on smart phones, at the beginning of next year.

After a request from the Embassy of the Netherlands in Lima, Peru, AgroFair and Tulipán Naranja facilitated a visit to de banana region by the online magazine FreshPlaza, which is read in several languages by tens of thousands of industry professionals every day. This visit, which took place in early May, resulted in several thematic ‘Peru - special’ reports in the magazine, including on ECOBAN, the cooperative model, climate and banana prices.

GRI standaard

GRI Standard Disclosure Location

GRI 2: General Disclosures 2021

2-1 Organizational details Page 9

2-2a Entities included in the organization’s sustainability reporting Page 9

2-2b Entities included in the organization’s sustainability reporting Page 9

2-3 Reporting period, frequency and contact point Page 54

2-6a Activities, value chain and other business relationships Page 7

2-6b Activities, value chain and other business relationships Page 8 & 9

2-6c Activities, value chain and other business relationships Page 12 & 13 AR Page 13

2-7 Employees Page 13

2-9 Governance structure and composition AR Page 9 & 10

2-10 Nomination and selection of the highest governance body AR Page 9

2-11 Chair of the highest governance body AR Page 9 & 10

2-15 Conflicts of interest AR Page 10 & 11

2-18 Evaluation of the performance of the highest governance body AR Page 16

2-22 Statement on sustainable development strategy Page 15

2-23 Policy commitments Page 15

GRI 3: Material Topics 2021

3-1 Process to determine material topics Page 18-21

3-2 List of material topics Page 18-21

GRI 201: Economic Performance 2016 201-1 Direct economic value generated and distributed Page 38

201-2 Financial implications and other risks and opportunities due to climate change Page 38-39

GRI 205: Anti-corruption 2016

205-1 Operations assessed for risks related to corruption AR Page 10 & 11

GRI 207: Tax 2019 207-1 Approach to tax Page 45

207-2 Tax governance, control, and risk management Page 39

207-4 Country-by-country reporting Page 39

GRI 304: Biodiversity 2016 304-2a Significant impacts of activities, products and services on biodiversity Page 33, 34

GRI 305: Emissions 2016

305-1 Direct (Scope 1) GHG emissions Page 33, 34

305-2 Energy indirect (Scope 2) GHG emissions Page 33, 34

305-3 Other indirect (Scope 3) GHG emissions Page 33, 34

GRI 308: Supplier Environmental Assessment 2016 308-1 New suppliers that were screened using environmental criteria Page 8

GRI 405: Diversity and Equal Opportunity 2016 405-1a Diversity of governance bodies and employees AR Page 9

405-1b Diversity of governance bodies and employees Page 13

*AR : Annual Report

AgroFair Benelux B.V. has reported the information cited in this GRI Index for the period 2023-2024 with reference to the GRI Standards.

Contact information: sustainability@agrofair.nl

Colofon

Edited & Contributed by:

Luud Clercx

Hans-Willem van der Waal

Linett del Carmen Duque Cedeño

Nicanor Cabrera

Ronald Garrido

Laura Philippe

Jo Sungq

Guido de Bruijn

Marcos Miedema

Concept & Design:

Diewertje van Wering

Reitske Bosschem

Orientation Travel Production

Photography and other Credits:

Tim de Kler

Yannick van de Graaf

Pablo van Linden

Linett del Carmen Duque Cedeño

Jo Sungq

Eliana Noé

Carolina Dawson

Frank Castillo

A special thanks to all the producers who delivered photo materials.

©2024 Copyright:

The content of this publication is copyrighted. Nothing from this publication may be reproduced or transmitted in any form or means, electronic, mechanical, photocopying, recording or otherwise without written consent of AgroFair Benelux.

While every effort has been made to trace all present copyright holders of the material in this report any unintentional omission is hereby apologized for in advance, and we should of course be pleased to correct any errors in acknowledgements in any future editions of this report.

AGROFAIR EUROPE B.V.

AGROFAIR BENELUX B.V.

Koopliedenweg 10, 2991 LN Barendrecht, The Netherlands

www.agrofair.nl sustainability@agrofair.nl