The recent arrival of Tropical Race 4 (TR4) in El Oro province of Ecuador, is just the latest challenge to the economic, social and environmental sustainability of the South American country’s export industry, already grappling with European legislation on Human Rights and Due Diligence legislation, a drive towards Living Wages in the supply chains of European retailers, and pressures to transition to less chemically reliant farming methods, among others.
The industry’s response to these multiple challenges has been the subject of much discussion and activity, and was documented in a recent report by bananaexport.com, which, among other things, recognises the contribution of Banana Link research and thought leadership in the march towards a more socially and environmentally sustainable future for the industry.
Banana Link’s Communications Coordinator Paul Lievens takes a look at the issues, and the road to sustainability for Ecuadorian export production. One inescapable conclusion being that addressing the industry’s challenges will require investment, which will mean that retailers, and consequently consumers, will need to pay more for their bananas.
Panellists discuss the challenges faced by the banana industry at Fruit Attraction, Madrid (Photo: Banana Link)
The world’s leading banana exporter
Ecuador is the world’s leading banana exporter, accounting for almost a third of global exports, and representing 38% of the country’s agricultural GDP. It supports over 7,000 farmers and generates over a million direct and indirect jobs.
The Ecuadorian industry differs somewhat from that in many Latin American countries. Instead of being dominated by large multinational companies like Chiquita, Del Monte and Dole, the crop is mostly grown on private plantations which sell their crops to national and international companies. Small to medium-scale farmers dominate the industry.
Ecuadorian banana cultivation is dominated by chemically reliant monoculture production, with Fairtrade and organic certified bananas representing only a small proportion of national output.
While Ecuador has both a statutory minimum wage and a statutory minimum farmgate price for its bananas, both fall well short of what is required to provide producers with prices that meet the costs of sustainable production and therefore Living Wages for plantation workers.
External Legislative pressures
The principal external legislative pressures relate to human rights and to the use of chemical pesticides for pest control on plantations.
Human Rights and Due Diligence
The European Union Corporate Sustainability Due Diligence Directive adopted in 2024, mandates that large companies identify and mitigate adverse human rights and environmental impacts in their operations and global value chains. It requires setting up due diligence policies, engaging with stakeholders, and establishing grievance mechanisms.
The directive represents a shift toward mandatory, legally enforceable sustainability standards, aligning with the 6 steps of the OECD Due Diligence Guidance. EU member states have until July 2028 to transpose the directive into national law, with phased application between 2027 and 2029.
Some countries are already ahead of this curve, like Germany, where the Supply Chain Due Diligence Act (Lieferkettensorgfaltspflichtengesetz – LkSG), came into force in 2023, requiring companies with over 1,000 employees in Germany to identify, prevent, and mitigate human rights and environmental risks across their entire supply chain. It demands risk management systems, regular reporting, and complaint procedures.
Banana workers in Costa Rica have already received compensation payments following a complaint by Oxfam Germany and the Costa Rican trade union SITRAP under the German law. The complaint concerned labour rights violations at an Aldi banana supplier in the country.
Non-EU nations are also in the process of implementing similar legislation, such as Switzerland, who are currently consulting on proposed national legislation that mirrors the EU Directive.
Reducing reliance on chemical pesticides
As a result of its listing in 2025 as a Persistent Organic Pollutant (POP) under the Stockholm Convention, the use of the insecticide chlorpyriphos is now being phased out globally.
Chlorpyriphos is an organophosphate product frequently used in banana cultivation, particularly in plastic bags treated with the chemical that cover banana bunches to protect against insects. It has been linked to deleterious effects on both human health and the environment.
Photo: Banana Link
Ecological, non-chemical alternatives to chlorpyriphos do exist, the use of which that can enhance agroecosystem resilience while protecting the health of workers, rural communities and ecosystems.
More generally, there is pressure from Europe to eliminate a wider range of harmful chemical pesticides used in banana production including the widely used fungicide Mancozeb, that is banned in the EU. A combination of permissible Maximum Residue Levels (MRLs) in fruit imported into the EU, plus pressure from certifiers and NGOs, is pushing the Ecuadorian industry towards more agroecological farming methods.
The transformative potential of agroecology in large-scale banana production is unquestionable. Agroecological practices offer vital alternatives to chemical fertilisers and synthetic pesticides, providing a sustainable path to recovering soil health and long-term productivity.
Given persistent threats like the TR4 fungus, it is increasingly clear that the industry must prioritize creating healthier agro-environments. The goal is to increase productivity without a corresponding increase in chemical applications, regardless of whether those chemicals are permitted under organic certification.
A compelling example of this approach is being led by CIRAD in Colombia, where they have successfully piloted these practices on a 90-hectare plantation with plans to scale up to 1,000 hectares in 2026. This is a development we should follow closely and from which lessons could be learnt.
As environmental concerns grow and mandatory human rights due diligence legislation is implemented in buyer countries, agroecology may become the primary route to ensuring the sustainability of industrial-scale agriculture. However, producers cannot navigate this transition alone. There is an urgent need for commitment across the entire value chain to invest in the costs of these transitions and to share the risks associated with adopting new practices.
Furthermore, it is essential to involve workers and their representatives in this process. Success will require an orchestrated effort to ensure the workforce acquires new skills and a deeper understanding of these evolving agronomic practices.
European retailers push for Living Wage
In recent years a number of European retailers – principally in Belgium, Germany, the Netherlands and United Kingdom – have made public commitments to work towards ensuring that workers in their banana supply chains are paid living wages.
An Oxfam Briefing Paper – Paid up? Living wage efforts in banana supply chains of Dutch and German supermarkets (April 2026) – published this week, surveyed the progress of Dutch and German supermarkets in working towards this aim. While measurable progress has been made in closing living wage gaps, there is still some way to go to achieve full living wages in banana supply chains.
The Global Living Wage Coalition (GLWC) defines living wages as:
“Remuneration received for a standard work week by a worker in a particular [time and] place sufficient to afford a decent standard of living include food, water, housing, education, healthcare, transport, clothing and other essential needs including provision for unexpected events.”
The principal method, used by the GLWC, for calculating living wages in any particular country is the Anker Methodology. However, while this methodology presents a valuable approach to calculating Living Wages, it is perceived to have some shortcomings, such as defining one living wage for an area, which can leave high-need households, such as lone-parent families or those with many young children, struggling even if they earn a living wage. Moreover, the method focuses on costs for a “basic but decent” standard of living, not what workers might currently be spending in poverty conditions.
Additionally, a 2025 International Labour Organisation report – A methodology to estimate the needs of workers and their families for the purpose of wage setting, including living wages – has provided added impetus to promoting living wages in export banana production. Among other things, it provides practical guidance for using household income and expenditure surveys and economic data to inform social dialogue.
In recognition of the belief that it is plantation workers themselves who are best placed to attest to what represents a living wage for them, Banana Link conducted its own research in field research in 2024 among banana plantation workers in Ecuador’s El Oro region. The research was funded by the German Retailer Group on Living Incomes and Living Wages to inform their efforts to close Living Wage gaps in their supply chains.
The Banana Link field interviews found that most workers say their salary is inadequate to meet their family’s needs. In addition, workers lack formal contracts of employment or knowledge of their terms of employment, with women experiencing more precarious working conditions and poorer pay than their male colleagues. Obstacles to workers ability to exercise their right to freedom of association and collective bargaining further compound these challenges.
Amongst the recommendations made by Banana Link as a result of this research was that:
- Retailers and multinationals must commit to paying fair prices and integrate them into a comprehensive package of responsible purchasing practices, including longer-term contracts and a commitment to engage with suppliers on any labour rights issues that arise.
- Retailers should make public commitments to freedom of association and social dialogue as they work to establish living wages and decent work in their supply chains.
- A national dialogue round table should be convened to address the key issues for the industry.
- Workers need to be better informed about their labour rights.
- Employers must ensure that workers understand their contractual terms and conditions and receive a physical copy of their contract.
- Research institutions should complete a full update to the living wage study in rural areas of the Ecuadorian coast.
- The apparent contractual discrimination against women should be further investigated.
Although the German government and retailer-funded programme focused on living wages has come to an end without being able to establish a regular social dialogue forum at industry level, Banana Link is hopeful that recent signals from industry leaders could lead to the creation of mechanisms to start building such a dialogue, starting from the reality that the labour contracting system needs attention as well as wages and prices.
Experience in other countries like Côte d’Ivoire suggests that it is indeed possible to establish structured social dialogue where none existed, with both companies and their trade associations as well as trade unions playing a central role in dialogue that leads to sector-wide bargaining.
Photo: Banana Link
Drug related crime
In addition to the pressing challenges outlined above, Ecuadorian producers are also grappling with the impact of a well-publicised drug-related crime wave in the country. In recent years, the country has become a major logistical hub for drug trafficking, with criminal gangs frequently contaminating banana shipments to Europe and the U.S. with cocaine.
Nearly 70% of drugs consumed in Europe are estimated to be exported from Ecuador, with bananas used for roughly 35% of these contaminated shipments.
The country’s export associations, Acorbanec and AEBE, claim that security costs have increased as a consequence, estimating that the figure exceeds $100 million in transport and freight logistics.
Conclusion
Banana Link’s International Coordinator, Alistair Smith, summed up the situation, saying:
“Ecuador faces multiple challenges, one of the most important being the need to establish a permanent social dialogue mechanism between producers and independent trade union organisations. This relates to the country’s employment contracting legislation which is one of the major challenges for workers to achieve living wages and decent work. The industry is also starting to focus on soil health and the substitution of agrochemicals with biological solutions, which is essential if the challenge of TR4 is to be addressed in the medium-to long-term. Ecuador’s leadership on these and other issues raised in this blog will be vital for the global banana sector.”
