Banana exports to the EU and US rise in 2018
Fresh Del Monte posts Q3 loss of US$21.5 million
Due to “operational challenges” from the first part of 2018, Fresh Del Monte Produce has reported a net loss for the third quarter of US$21.5 million. The company acquired Mann Packing in February and in June recalled some vegetable trays following reports of illnesses. Del Monte posted a profit of US$11.5 million in the third quarter of 2017.
Supply of bananas to Spanish market up 4.6% in 2018
The Customs and Excise Administration of the Tax Agency has just published information on foreign trade in Spain for the month of May 2018. In that month, banana imports almost equalled exports from the Canary Islands. Around 32,000 tons were shipped from the Canary Islands to the Spanish market, with imports from abroad totalled about 29,700 tons. Compared with the month of April, shipments from the Canary Islands were down by 5%, imports fell by 9% and re-exports dropped by 2%.
Fyffes recognised for Fairtrade contribution
This year marks 30 years since Mexican coffee producers decided to advocate for better trade conditions to reduce their dependencies on charity and off-farm activities, creating the basis for what is today the Fairtrade Movement. At a celebratory event titled "Fairtrade: Thirty Years Creating Value with Producers Worldwide” held in San Jose, Costa Rica, key actors were recognised for their contribution to the movement. One such player was Fyffes, in the Trader Category, which was awarded a prize for its fundamental role in developing fairtrade practices.
Fusarium wilt disease triggers race to find resistant banana variety
The race is on to develop a banana variety resistant to the diseases and climatic changes that currently threaten the world’s favourite fruit. International trade in the fruit is worth US$13bn a year. But the global supply chain is threatened by a virulent disease that has been attacking plantations in Australia, south-east Asia and parts of Africa and the Middle East. Experts warn that “Fusarium wilt”, or Panama disease, could spread to Latin America, from where the majority of bananas are exported, prompting scientists to research new varieties.
Global banana market in crisis
After 2018 got off to such a positive start in terms of both price and volume, the banana market has experienced a rapid fall in prices since April due to overproduction. This crisis, which started in Russia before moving westwards, comes at a time when negotiations are set to begin between Europe and the countries of the dollar zone with a view to lowering tariffs. This crisis has been on the horizon for some time now and has only been averted thus far by adverse weather conditions lowering output. But the long-expected trouble now appears to be at the gate.
Ecuador’s banana exports drop 13%
Prices of Ecuador’s bananas have fallen as poor market conditions have led to lower exports (13% below average). The situation in Russia is particularly bad, with extremely low prices. The Spanish market price is more positive due to the supply deficit in the Canary Islands. In Weeks 1-21 of 2018, the average market price on Ecuador’s domestic market was up 1% compared to the same period of the previous year.
New trade agreement between EU and Mexico lowers tariffs on bananas
A new trade agreement between the EU and Mexico will cover more than 85% of the sectors which were not covered by the previous agreement, including agriculture. The only products excluded relate to the sugar sector. Mexico’s banana exports will obtain the preferential tariff of €75/ton. For fruits not yet liberalised, such as apples, full liberalisation will be achieved in ten years, with tinned peaches to be liberalised within 7 years.
No end in sight for shortfall in supply of bananas to Europe
The lack of banana supplies in the European markets seen during the opening weeks of 2018 is showing no sign of abating. Volumes of French West Indies bananas are currently 67% below average, while African volumes are 12% below average. The slightly above average volumes arriving from Cote D’Ivoire are not enough to compensate for the 22% drop in Cameroonian supply. Elsewhere, Latin American production has also remained limited, and despite recording an increase, Colombian volumes are still 11% below average levels.
Fresh Del Monte Produce to deal with oversupply of bananas
According to Fresh Del Monte Produce CEO Mohammad Abu-Ghazaleh, the reason for the glut in the banana market and the lower prices is that during this season, there have not been the adverse weather conditions that have affected previous years’ harvests. He also emphasises the need to appreciate that the first half of the year saw very good prices, with markets behaving optimally across the world. The problem occurs in the second half of the year, during which supplies increase and demand falls.