Princes is claiming an industry first after it established an agreement with growers in its Italian tomato supply chain for a “fair price” for their produce ahead of the 2022 harvest.
The move by the food giant’s Italian tomato processing business Princes Industrie Alimentari (PIA) will soon see it sign pricing contracts that reflect “the rising costs of production”, Princes said, and would enhance financial security among growers and their workers “well in advance” of the harvest later this year.
It follows an announcement of PIA’s commitment to early price guarantees last December, alongside an expansion in its collaboration with leading Italian agricultural association Coldiretti, to enhance the social, environmental, and economic value of the tomato supply chain. Princes also launched a new partnership with Oxfam Italy in February as part of an effort to improve working conditions within its tomato supply chain.
It said signing contracts in advance of harvest season (rather than as late as July as seen with other suppliers), was “an important ethical practice which helps to enhance financial security among growers and their workers through the guarantee of fair and transparent pricing”.
Princes said PIA and Napolina had also factored cost increases throughout the process into pricing across the Apulia region, where growers are facing water shortages and supply chain disruption.
The prices agreed with growers for the 2022 season have been established in collaboration with the Department of Agriculture Sciences at the University of Foggia and guarantee a fair price for around 300 producers, across 30 partner co-operatives.
And in addition to a fairer price, the supplier added it would further reward growers who supplied “high-quality” tomatoes through a raft of other support mechanisms linked to sustainability. PIA paid out an extra €3.9m (£3.2m) to its agricultural partners in addition to its base price last year, as a bonus for their contribution to the sustainability of the sector.
“One of the key challenges that many tomato producers face in southern Italy is not knowing what prices they will be paid until a few weeks before the harvest begins,” said Andy Hargraves, Princes group director for Italian products.
“At that point, if a grower has concerns for the profitability of their crop, the only costs that can be cut are in labour. This late contracting has been frequently cited by NGOs as a contributor to forced labour and human rights abuses. However, it is a practice that still continues today.
“By signing contracts in advance, we are giving our growers more time to plan their investments for the harvest season, fostering financial stability and supporting the implementation of best practices and state-of-the-art technologies that help to enhance both social and environmental sustainability,” he added.
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