Banana recovery in the first quarter; Europe bought more

Banana recovery in the first quarter;  Europe bought more

2023-05-02 07:05:00

Banana exports recovered with growth of 6.01% in the first quarter. Europe was the market that bought the most. Photo: AEBE

Betty Jumbo R. Publisher (I)

Banana exports recover andn the first quarter of 2023. The best buyer was the European Union.

The Association of Banana Exporters of Ecuador (AEBE) shows the numbers of boxes sent to the markets.

Between January, February and March, 96.03 million boxes were exported. In those months of last year there were 90.58 million. The growth was 6.01%.

José Antonio Hidalgo, Executive Director of the AEBE, explains that, however, this increase may be due to market prices, which were very good and opportunities.

Russia’s war against Ukraine had an impact from the end of February 2022. Therefore, this growth rate may only be a sign of first-quarter recovery compared to 2022, he says.

In 2022, exports were affected by the Russian invasion, logistics, the national strike and the appreciation of the dollar.

For example, the strike affected the harvest, packaging and transportation. The higher value of the dollar discouraged banana imports from European countries.

The sum of these factors caused the drop in exports. It was a reduction of 23.89 million boxes in that period, according to figures from the Central Bank.

A first quarter of good prices

In 2023 there have been ups and downs. January is a particular month, because the fruit comes out that there were better temperatures in 2022.

The variation rate of exports was 8.25% compared to January 2022 and in February it was 0.8%, despite the bad weather conditions.

This panorama of the first quarter seems to have a relief with an accumulated growth of 6.01%.

Hidalgo visualizes a slight recovery due to the climatic effects of last year, but it is necessary to see what impacts are going to have with the excess of rains. This increases production costs, there is damage to the farms. You have to review week by week, he says.

He emphasizes that the sector needs a competitiveness policy, because they had an impact on production. “We have greater pressure because the sector has a higher tax burden; it has to be accompanied by regulations that are attached to bananas.”

Banana destinations

The AEBE Banana Statistical Observatory indicates that of the 96.03 million boxes exported in 2023, the European Union has a 31.22% global share. This positions it as the main destination for Ecuadorian fruit.

In this quarter they bought 29.98 million boxes, in contrast to 2022 when they were 24.44 million. The increase of 22.67% (see chart).

The United States increased its imports by 6.34%. It bought 8.90 million boxes in 2022 compared to 9.47 million boxes in 2023.

Market behavior

During this first quarter, banana growers faced expensive and increasingly demanding certifications from the European markets.

He AEBE Banana Statistical Observatory indicates that this generates uncertainty and changes in the projections of the banana business.

On the other hand, the trade barriers of Japan and South Korea affect the competitiveness of the business.

Due to the congestion in the ports of Busan in Korea, Qingdao in China and Mersin in Turkey, it also impacts the quality of business.

In addition, the reduction of external demand, due to the consumption of other fruits of water; the congestion to obtain shipping space and the restrictions of molecules by the markets are additional factors that have an impact on the industry.

At the national level, the industry faced various factors in its value chain. There was contamination of containers, lack of shipping quotas, insecurity in the country and competition in the input market affected the distribution and dynamics of the chain.

The sector also goes through a shortage of skilled labor, financial problems, the rains, frequent muggings, the political situation and the lack of security in the shipping industry. All of this had a negative impact on the chain’s productivity and profits.

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