Philippe Binard, Freshfel Europe’s general delegate
Over 200 representatives of Europe’s food industry and the public sector gathered for the ESSA (European Sprouted Seeds Association) and Freshfel Europe’s Food Crisis Management Event this week to study previous crises and prepare to respond to future hypothetical scenarios through closer cooperation.
Freshfel Europe’s general delegate, Philippe Binard, said, “The fresh produce sector strives for good practices in production and trade. However, this is reliant on a high level of cooperation with authorities and other actors.”
Attendees discussed how previous food crises were handled in terms of food hygiene and food fraud issues, as well as the nefarious impact of misinformation and the need for greater transparency.
“Transparency plays a big role in crisis management. It is based on a long-term confidence between public and private stakeholders. During the crisis and recovery period, good and consistent communication is essential. All stakeholders involved in a crisis should set up communication tools among each other as well as to the public. European and national authorities play a big role in informing the public, as well as in restoring consumers’ confidence,” said Binard.
Similarly, ESSA’s secretary general, Eglė Baecke, stressed that cooperation must be a “continuous process and applied in practice, such as through crisis simulation exercises.”
With the Spanish citrus industry in crisis due to the large volumes of South African fruit flowing into the EU, in October, Spain’s Government will request the EU activates the safeguard clause to protect its citrus fruits. This step is a response to calls from citrus associations and political parties to protect Spanish production which has suffered a drastic drop in the prices in Valencia.
Before making the request to the EU, the trade agreement must have been valid for three years with South Africa. The Spanish Government will also demand greater rigor in the application of current phytosanitary norms with regard to fruit from third countries.
President of the Valencian Association of Farmers (AVA-ASAJA), Cristóbal Aguado, said that this campaign has been a disaster and stressed that EU agreements with third countries have been exceeded because there is no reciprocity.
Various measures have been taken to try to alleviate the crisis. In December, the Ministry of Agriculture withdrew 50,000 tons of Spanish citrus from the market to protect prices, however, according to the agricultural organisations, losses are in excess of €100 million.
The trade agreements signed between the EU and Latin American countries providing tariff preferences includes safeguard clauses and a stabilisation mechanism for European producers. Despite the EU commission stating that the increase in imports of Latin American bananas would have no negative impact on the price levels and stability of the European market, in contrast with most years, when banana prices begin to fall in May, this year prices plummeted in April, from €19 per 18.5kg box in Poland to €3. This would appear to mark the commencement of a structural crisis of overproduction in the banana sector.
The exponential growth seen in Latin American banana production, coupled with the fact that export thresholds granted by the EU are regularly exceeded, the EU commission is being urged by European producers to take steps to protect the region’s banana production. One proposal is to temporarily suspend preferential tariffs.
After 2018 got off to such a positive start in terms of both price and volume, the banana market has experienced a rapid fall in prices since April due to overproduction. This crisis, which started in Russia before moving westwards, comes at a time when negotiations are set to begin between Europe and the countries of the dollar zone with a view to lowering tariffs. This crisis has been on the horizon for some time now and has only been averted thus far by adverse weather conditions lowering output. But the long-expected trouble now appears to be at the gate. The exceptional beginning to 2018 has made the subsequent fall that much more dramatic. Prices have fallen from a record high of €18-19 to a record low of €3-4.
The oversupply derives from the huge international production base which has grown to meet the rising consumer demand. Meanwhile, productivity is also rising and other producing countries are re-emerging such as Honduras and Nicaragua. West Africa is also expanding (with the noteable exception of Cameroon.)