Demand for Ecuadorian bananas is expected to drop by 30%

Ecuador's banana sector has remained operational during the state of emergency that the country is experiencing due to the coronavirus. However, "we have not been oblivious to logistical problems, especially caused by staff absenteeism for fear of becoming infected, especially in carriers, container yards, and other actors in the chain," stated the Banana Export and Marketing Association (Acorbanec).

According to a report, the vehicles and drivers were being stopped or detained at controls until the government ordered authorities to respect the use of safe conducts and the transit of trucks with food, containers of bananas, production supplies, and export materials for this fruit through the logistical corridors.

The fruit continues to be shipped to international markets, but not as usual. Diario EXPRESO confirmed that producers were not shipping all their fruit due to the contraction in the purchasing countries. Today the fruit that is sold under the spot modality (out of contract) stands at 2 and 2.5 dollars per box, but the fruit has also reached 12 and up to 15 dollars in times of low supply, like in the beginning of early year.

Acorbanec believes it urgent that the Government adopt measures to provide this strategic sector with liquidity and incentives through different mechanisms, such as the conditional and simplified return of taxes and immediate access to working capital financing lines through public entities, such as the National Finance Corporation and Ban Ecuador.

"Until this emergency passes, it is urgent and necessary to immediately regulate the exportable supply starting next week, due to the complication of the destination markets and to avoid further falling prices," said Richard Salazar, executive director of the union.

Russia, Poland, England, Germany, France, the Netherlands, Italy, Greece, Belgium, Spain, Eastern Europe, and the Middle East, among others, have reduced or stopped banana purchases, mainly due to logistics problems to distribute the fruit because of mobility restrictions in those nations.

According to the purchase notifications of our clients from abroad, “especially in contracted fruit, we estimate that, depending on the market, starting the following week and for about 4 weeks purchases in the destination markets will decrease by approximately 30% on average,” Salazar stated.



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