The Philippines Banana Planter and Exporter Association (PBGEA) has announced that profits in banana exports fell by 15% due to the outbreak of Covid-19, which increased shipping costs and delayed transport, reports Business Mirror.
Shipping costs increased by 15%-20% last year, and the transport period increased from an average of 25 days to an average of 30-33 days. The main reason for this delay in transport is the spillover effect from backlogs in Chinese and Singaporean ports in late 2020. Backlogs in one port mean that supply ships miss their rendezvous, which leads to further delays.
The Philippines suffers more from distribution problems in comparison with countries like Vietnam and Cambodia that are closer to the Chinese market. That is why Vietnamese and Cambodian bananas gradually push bananas from the Philippines out of the Chinese market. Last year almost 90% of the Chinese import bananas came from the Philippines, while only 10% came from Vietnam and Cambodia. This year almost 40% of the Chinese import bananas come from Vietnam and Cambodia.
Banana exports declined by 51% in January to 186,000 tons of bananas, while the export value dropped by 47% to US$85 million. Japan is still the largest export market for bananas from the Philippines in terms of export value, but China is the largest market in terms of volume. The income from banana export slumped 20.6% in 2020 to US$1.55 billion.