In the Philippines, Cavendish banana growers have trouble to keep their heads above water. The main causes are growing competition from Latin American growers and a still creeping and devastating Panama disease at home.
The industry is still holding its market though, government regulators and private growers would say, although the percentage share of what was once a dominant market control keeps slipping past, as countries like Japan and South Korea impose higher tariff on Philippine banana than on newcomers from countries like the No. 1 grower, Ecuador.
A higher tariff means exporters from the Philippines would have to charge higher retail prices to offset the tax in the foreign market, but this simple economic reality would not be palatable to the ordinary Japanese or South Korean consumer, who have other choices from cheaper competing brands.
And so Philippine exporters have to bring down their retail price at the level of their competitors to stay afloat, at the risk of trimming down further the profit margin, while costs of growing the banana at home are getting more expensive.
Source: businessmirror.com.ph