“Bananas have become a commodity, unfortunately”

The bananamarket is hot, with good sales and high prices. Hans Maagendans, of BanafoodServices, talks about what’s going on in the banana market. Hans says prices onthe free market are very high for the time of year. “The first three months ofthe year, banana sales are always going well, just like this year. Supplieshave been very low for the first two months, partly due to temperature problemsin Colombia and Costa Rica. The lower supplies in the first months is an annualtrend as a result of changing weather conditions and delayed arrivals.”

Export to Russia decreases
Sales-wise, a lothas been lost when it comes to bananas to Russia. He says this has been goingon since the middle of last year. “Still, not a lot at all is going to Russia.This is partly due to the weaker rouble. Ecuador also thought they could exportmore to Asia, but that turned out a lot lower with the Philippines in fullproduction again.”

Ecuador
Ecuador is one ofthe biggest banana exporters. Last year, they achieved an export record of 295million boxes. Hans visited the banana plantation in Ecuador last November. Henoticed the sector is very professional there. “The country also has a stableclimate, and the production lands are at a higher altitude. The production perbanana bunch is also high there. A large part of the Ecuadorian bananaproduction is exported to China. The United States and Europe are other importantdestinations for this country. Thanks to its location on the Pacific, China isa favourable destination compared to the Atlantic side. Apart from the importduties, ships from Ecuador to Europe have to pass through the Panama Canal,which is a costly affair.”

Unequal import duties to end?
This year, the unequal import duties are finally supposed to end. Ecuador andthe European Commission have reached an agreement on levelling the tariffs.This should happen mid-2015. Hans expects it will take a while before it reallycomes into force. “The import duties have been a source of conflict for yearsnow. It will likely take until 2016 before the agreement to come into force. Interms of sales, not much will change, but the competition will become morefair.” He explains that Ecuador also uses a minimum sales price, a rule thatdoesn’t exist in other important production countries like Colombia and CostaRica. “A rule that prevents the market from becoming spoilt from bananas thatare sold at prices that are far too low.”

Retail
The banana markethas changed enormously in the past few years, partly because of upscaling inthe world of retail. Hans explains that the role of banana ripening companieshas also changed because of that. He is disappointed about the aggressivepricing policy which has been conducted in Dutch supermarkets for almost twoyears now. “This is bad for the banana trade, and leaves deep marks. You canconclude from this that the banana market has become a commodity market.”