Comparative Analysis of Banana Cultivation Costs in Latin America: The Economic Benefits of Collective Action

This study examines the economic impact of Farmer Producer Companies (FPCs) on banana cultivation costs in Ecuador. Comparative analysis of data from 150 FPC members and 150 non-members reveals that collective action through FPCs significantly reduces cultivation costs across multiple input categories. FPC members experienced statistically significant reductions in human labour (-10.53%), machine labour (-36.84%), fertilisers (-19.19%), and plant protection chemicals (-19.13%), resulting in an overall cost reduction of 13.87%. Concurrently, FPC members achieved 18.28% higher yields (11 tonnes/acre versus 9.3 tonnes/acre), which translated to 26.73% higher gross returns and 77.36% higher net returns compared to non-members. These benefits stem from bulk procurement advantages, resource-sharing mechanisms, and technical advisory services facilitated through the FPC structure. The findings demonstrate that FPCs effectively address the structural challenges faced by smallholders through economies of scale and enhanced bargaining power, presenting a viable pathway for improving profitability and sustainability in Latin American banana cultivation. This research contributes quantifiable evidence to support the promotion of farmer collectives as an effective intervention for rural economic development and agricultural policy reform.