By Leonardo Blair, Staff Reporter 
Richard Jones, 51, who has been working at the Victoria Banana Estate in Parnassus, Clarendon for the past 10 years, "de-hands" a bunch of bananas at the estate, yesterday. The company will officially cease production of bananas for export today, making more than 300 workers redundant. - Rudolph Brown/Staff Photographer
ON THE eve of the official shutdown of the Victoria Banana Company Ltd (VBC) in Parnassus, Clarendon yesterday, employees charged that the closure was due largely to mismanagement by the parent company, Jamaica Producers Group (JPG).
Several workers, who declined to give their names, told The Gleaner that they had agreed to sacrifice and work with measures implemented by management to control costs on their end, such as taking pay cuts, but apparently to no avail.
"Everybody here is working for a salary and them (management) come to us several times and ask us to take a smaller salary until the company start make more money, and we do it because we want the little work," said one supervisor. "We did every sacrifice to keep the company alive and look what happen?"
Things got so bad at one point, they said, that they knowingly signed an agreement to keep trade unions out of the affairs of the company in 1999 and that too was all for nothing.
However, chairman of the JPG, Dr. Marshall Hall, dismissed the charges of mismanagement being a significant factor to the shutdown and maintained that the closure of the estate was largely due to mounting losses, including a $43 million bill incurred by the recent flood rains, the repayment of a $90 million loan to UK-based joint venture partner, Fyffes PLC and praedial larceny.
"I am not going to say that everything was ideal (in terms of management)," said Mr. Hall. "We have had some (management) problems on the farms, but I wouldn't say that is why we are shutting down. We have significant praedial larceny," he said.
The Victoria Banana Company will officially close today, making redundant 314 workers.
About 70 of them will be rehired on contract to complete the close down exercise.
Workers who have worked at the estate for more than 20 years claim that they have seen more devastating damage to bananas than that caused by the recent flood rains and they were able to revitalise the farms "in quick time". Management, they say, is just using the rains as an excuse for their inadequacies.
Mr. Hall explained, however, that earlier disasters affecting the estate were hurricane related, for which the company is insured, but this time it was a flood, for which they had no insurance. He said about 300 acres of bananas were lost and it cost the company $43 million to replace.
On top of that, he explained, over the past three years the company has been losing money on all three of the estates it manages, which include the St. Mary Banana Estates and the Eastern Banana Estates. Mr. Hall said the estates sought loans to support their losses in hopes of returning to profitability but that plan had proved impossible for the Victoria Banana Company.
Fyffes, which loaned the Victoria Company $90 million, stopped purchasing Jamaican bananas in January 2001 and began sourcing the fruit from countries like Belize, Suriname and the Windward Islands where they got a better deal on the fruit.
Because Fyffes stopped buying Jamaican bananas, they stopped funding the losses incurred by VBC and the rains came with devastation and Fyffes soon demanded back its $90 million.
It was at this point, Hall said, that the decision was taken to shut down the farm as it was too costly. The operating costs had far outstripped the returns.
"Fyffe said they wanted back their $90 million. This loan was an unsecured loan at no fixed duration, so they can ask back for their money anytime they wish," said Mr. Hall.
"If Jamaica Producers wanted to keep the farm going they would have to repay the $90 million, which they didn't borrow, in addition to footing the $43 million dollar flood damage and future losses," explained the chairman.
"Jamaica Producers Group have been in the (banana) business since 1929. Bananas are very important to us. I would not want anyone to say that Jamaica Producers is broke and couldn't make payments to Fyffe," he said.
The other two estates are being kept running because they stand a better chance of making greater returns, noted Mr. Marshall. The Victoria Banana Company will officially close today, making redundant 314 workers.
About 70 of them will be rehired on contract to complete the close down exercise.
