Ecuador looks at setting price of the banana box for 2020 at US $6.40

On Friday, November 8, the Ministry of Agriculture and Livestock (MAG) of Ecuador will issue the Executive Decree that will set the price of the banana box for 2020. According to sources from the Ecuadorian digital medium El Comercio, the MAG is analyzing setting the value of the box at $ 6.40. They have also studied the possibility of establishing two prices, one for the low season (between 6.37-6.40 dollars) and one for the high season (6.45-6.50 dollars). However, this option is more complicated to apply due to the lack of consensus in the sector.

According to exporters, the price that is in force this year, which is $ 6.30 for the banana box of 41.5-43 pounds, must be maintained; otherwise, Ecuador would lose competitiveness in markets such as the European Union, compared to other vendors in Colombia and Guatemala. On the other hand, producers suggested that the price of the box rises to $ 6.80, considering that an increase of $ 0.50 could help cover production costs, which includes the purchase of agricultural inputs, pest control, labor, and transportation, among other things.

William Ramon, the president of the Banana Association of Naranjal (Guayas) and representative before the Banana Advisory Council, said that this year's budget included the cost of infrastructure implementation and prevention measures against the Fusarium Race 4 fungus. However, the Association of Banana Exporters of Ecuador (AEBE) stated that the investment to prevent Race 4 in 2020 cannot be included in production costs, as it wouldn't be amortized in one year because the banana is a perennial crop.

Between January and September 2019, banana exports increased by 2.12% over the same period of 2018, according to AEBE. According to forecasts, if this trend continues, the country would end the year having sold nearly 360 million boxes, a similar volume to the one achieved last year.

So far this year, exports to the EU, Russia, and the Southern Cone have decreased by 14.63%, 3.16%, and 7.91%, respectively. However, sales to the US, the Middle East, and Eastern Europe increased by 2.73%, 12.63%, and 10.84%, respectively.

 

Source: elcomercio.com 


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