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Calls for supply regulation to protect banana prices 

Calls for supply regulation to protect banana prices 

 

Ecuador’s banana growing area has been heavily hit by the Coronavirus pandemic. Although banana production and exports have remained operational throughout the crisis, demand has dropped by up to 25% due to the disruption of global markets. Richard Salazar of exporter association Acorbanec said, “In the first two weeks following the declaration of a state of emergency, practically everything that was programmed to be exported was shipped, in spite of significant problems with the availability of containers and other production materials, heightened controls and absenteeism of transport workers and other members of the supply chain due to fears of contagion. But markets like Russia, Europe and the Middle East have reduced or stopped banana purchases, mainly due to logistical and distribution difficulties resulting from measures taken by countries to slow the spread of the virus.”

There has been a dramatic slump in prices, which as of mid-April were hovering between US$2 and US$2.5 per box, compared to US$12-15 at the start of the year. To avoid further price falls, Acorbanec is calling for supplies to be regulated immediately until the worst of the crisis is over. “Some importers have fallen behind on payments and others have not been able to pay at all, affecting the liquidity of export companies. And certain clients are unfortunately taking advantage of the crisis to try and lower prices further, which we are resisting,” said Salazar, who added, “Bananas are hugely important for Ecuador’s economy, generating 250,000 direct and indirect jobs and around US$3.1bn in foreign currency. If exports are affected, the economy will pay a high price.”

 

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Slight dip in banana volumes

Calls for supply regulation to protect banana prices 

The global banana production has declined slightly due to lower temperatures in the Tropics. This has driven a general increase in prices (spot prices reached €9.45 per box in week 7). However, Europe has seen very little change in prices as yet. European banana producers in the outermost regions are concerned about a possible oversupply if import tariffs are also reduced for Brazilian and Mexican bananas, following a similar move with Peru, Colombia and Ecuador. The European Commission, therefore, has agreed not to lower tariffs below €75 per ton. 21% of Ecuador’s bananas go to Russia, where they have a 96% market share. Exports to Georgia and Ukraine have also risen sharply lately.

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Ecuador’s banana sector feels pinch of crisis

Ecuador’s banana imports slip in 2021

 

The current global crisis is putting the squeeze on Ecuador’s banana industry, with several factors combining to hamper demand. No bananas are being sent to China for the time being, while elsewhere, the higher reefer costs do not make it worth sending bananas long distances. The disruptions to the global transportation network are causing lengthy delays at the Panama Canal. This factor puts the rival Colombian bananas at an advantage, as they do not need to transit the Canal. All of this comes at a point where Ecuador is expecting to reach peak banana production.

 

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Ecuador convinces with fruity variety

Ecuador convinces with fruity variety

Import Promotion Desk (IPD) from Germany supports exporters from Ecuador and seven more partner countries at the international trade fair for fruits and vegetables

Ecuador is known for its biodiversity and offers a wide range of tropical fruits. The South American country lived up to its reputation at this year’s Berlin show. With bananas, pineapples, pitahayas, physalis and passionfruit, the exhibitors presented a richly filled fruit basket (Hall 21 Booth B‐06). The IPD has been supporting the partner country for two years now. In total, over 40 companies from eight IPD partner countries from Egypt, Ethiopia, Ecuador, Côte d`Ivoire, Ghana, Colombia, Peru and the Ukraine were present their range of fresh fruits and vegetables in Berlin.

“Ecuador has great potential in the fresh fruits and vegetables sector”, says Dr Julia Hoffmann, Head of IPD. “The country is mainly known as a supplier of bananas, but Ecuador offers a great variety of tropical fruits. Furthermore, it can score with specialties such as the yellow pitahaya from Palora. But not only the variety, also the quality is what makes the offer from Ecuador special.” In South America the IPD is further active in Peru and Colombia. Funded by the Federal Ministry for Economic Cooperation and Development of Germany (BMZ), the initiative supports small‐ and medium sized companies in accessing the EU‐market. At Fruit Logistica the exhibitors from Peru presented ginger and curcuma, as well as granadillas and mini bananas. The range of products from Colombia includes amongst others, bananas, papayas as well as avocados. From Egypt and Ethiopia comes a wide range of vegetables and fresh herbs as well as strawberries, oranges, limes, pomegranates, grapes and mangoes. The producers from the Ukraine showcased berries in Berlin, such as blue berries and raspberries. Newcomers this year wee producers from the Côte d`Ivoire and Ghana, who presented coconuts, mangoes, sweet potatoes and okra pods as well as pineapples and papayas to an international audience.

Colombia, Côte d`Ivoire, Ecuador, Egypt, Ethiopia, Ghana, Peru, Tunisia, Ukraine

The Import Promotion Desk (IPD) is an initiative for import promotion in Germany. The IPD fulfils a hinge function between small and medium-sized enterprises in selected emerging markets and developing countries on the one hand and European importers on the other. The objective is to integrate the partner countries into global trade, thereby contributing towards sustainable economic development in these countries. The IPD introduces exporters from its partner countries to the EU market and assists them in setting up trading relations. For European importers, the IPD opens up new supply sources in the partner countries and assists them in the procurement process for specific products.

Countries in the fresh fruit and vegetables program: Colombia, Côte d`Ivoire, Ecuador, Egypt, Ethiopia, Ghana, Peru, Tunisia, Ukraine.

Product focus:

Fresh fruit (temperate): e.g. berries, melons, stone fruits, grapes and citrus)

Fresh vegetables: e.g. young vegetables, beans, peas, sugar snap peas, artichokes, ginger, fresh turmeric, fruit vegetables, broccoli and onions

Fresh herbs: e.g. basil, coriander, marjoram, melissa, mint, oregano, parsley, rosemary, sage, chives and thyme

Sub-tropical and tropical fruit (exotic fruit): e.g. pineapples, avocados, bananas, cherimoya, dates, guava, pomegranates, persimmons; prickly pears, coconuts, mangoes, passion fruits, papayas, physalis and dragon fruits.

Quality protocol: thanks to its extensive sourcing the IPD guarantees that every selected supplier complies with the GlobalG.A.P. standard. GlobalG.A.P. is the one of the most important European standards for safe, sustainable production and high food safety. We assist promising producers in obtaining corresponding certification, paving their way to the European market for premium quality, fresh fruit and vegetables.

Organics, strategic value-chain

“In a focused manner, we support the export of products for which there is a high demand on the German and European market. Regardless of whether they are produced conventionally or organically.”

The demand for organic products has been growing for years, and there is great – as yet undiscovered – potential in developing and emerging countries. In countries such as Ghana, Ethiopia and Egypt there are already first organic suppliers. IPD supports these companies on their way to the European market.
“We advise the companies on organic certification. In some countries, it is more a matter of converting from conventional to organic farming in order to increase export opportunities.”

Organic’ is not only ecologically sustainable, but also in an economic sense. The demand for organic products is not a short-term trend, and there are companies in developing and emerging countries that have been active in the sector for many years. For example, the company Fincas de El Oro from Ecuador. It specialises in the cultivation of Cavendish bananas and their processing into jam and juice, for example. The Cavendish variety is particularly robust and therefore popular – with producers and consumers alike.

Fincas de El Oro works with around 50 partners – small farmers from the El Oro region. They dispense with the use of synthetic fertilizers and pesticides. The cooperative also pursues other ecological projects to improve the quality of the soil and conserve resources. For example, the farmers use biofermentation to make the soil more nutritious and have introduced a new water technology to reduce consumption. To protect biodiversity, the cooperative is also involved in reforestation in its fields and in parts of the surrounding primeval forest.

Especially in the organic segment, personal contact is an important argument when selecting a supplier. A lack of contacts with European retailers is therefore a major hurdle for many producers. For this reason, IPD arranges business contacts with potential customers within the framework of trade fairs and supports them with training in export marketing. This year, for example, we have already accompanied companies from our partner countries to Fruit Logistica and Biofach.

Further information www.importpromotiondesk.de

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Ecuador Exquisito 2.0

Ecuador Exquisito 2.0

As part of Ecuador’s participation as a Guest Country at Fruit Logistica, Ecuador Exquisito, an institutional brand for the promotion of the Premium export food and beverages sector of Ecuador, was presented through gastronomic tastings involving outstanding Ecuadorian and foreign chefs. Such promotional events are organised abroad in coordination with the network and commercial offices.

The renowned Ecuadorian chef Carlos Gallardo was together with the Vice-Minister of Export and Investment Promotion at the Ecuador stand on the last day of the fair, emphasising that this gastronomic promotion tool seeks to contribute to national exports by positioning the country’s products in recognised recipes that attract the interest of buyers, consumers and opinion leaders internationally.

Gallardo later demonstrated a dish made with typical Ecuadorian ingredients, an exquisite ceviche of white fish, shrimp and octopus with mango.

In 2019, five Exquisite Ecuador events were held in the cities of Beijing, Guatemala, Madrid, Toronto, Sao Paulo. Since its creation in 2014, 94 international gastronomic events have been held, with the participation of approximately 500 exporters.

Its web platform will allow Ecuador Exquisito to progress to level 2.0 to meet new actors interested in the country’s exportable offer from the sectors of:

– Aquaculture

– Agroindustry

– Processed foods

– Banana

– Cocoa

– Coffee

– Non-traditional fruits

– Fishing

This space will contain audiovisual materials linked to the official institutional accounts on social networks featuring the different initiatives of Ecuador Exquisito, as well as the testimonies of the participating chefs and the impressions obtained from buyers and potential investors during the events. Thus, Ecuador Exquisito can generate greater credibility and give potential buyers the opportunity to review the ingredients used in recipes prepared with Ecuadorian products.

Visiting the site, you can see a list of exporters from the participating sectors, previously validated by the institution to establish new commercial contacts with exporting companies that meet the criteria demanded by the international market.

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Ecuador to launch ‘Premium and Sustainable’ brand at Fruit Logistica 2020

Ecuador to launch ‘Premium and Sustainable’ brand at Fruit Logistica 2020
Launching event in Ecuador.

The trade show’s Partner Country will bring its largest and most diverse delegation yet, featuring senior government dignitaries and 38 produce grower-exporters across a 600m2 pavilion.

Ecuador’s Minister of Agriculture, Mr Xavier Lazo, will launch the ‘Ecuador: Premium And Sustainable’ fresh produce brand at Fruit Logistica 2020, during the Latin American country’s biggest-ever participation at the world’s largest fresh fruit and vegetable trade fair, on 5-7 February 2020 in Berlin, Germany.

The brand, which will accompany Ecuador’s highest quality produce exports to Europe, is based on five pillars within the country’s agricultural vision:

  1. New Cooperativism: A new form of association to help progress the agricultural sector;
  2. Rural Women Empowerment and Rural Young Entrepreneur: Empowering women in family agriculture, as well as fostering the rural youth to use their creativity and innovation to solve problems and improve production in the agricultural sector;
  3. Zero Deforestation: Implementing deforestation-free practices in the agricultural sector;
  4. Productivity, Quality and Traceability: Showing the story behind each product; in other words, when and where the product was produced, and by whom; and
  5. Zero Rural Poverty: This is the main goal; to achieve progress in rural areas in order to put a stop to poverty; assuring an Ecuador with success, hope and progress – an Ecuador: Premium And Sustainable.

Ecuadorian produce supplied under the Ecuador: Premium And Sustainable banner will enter the most demanding consumer markets distinguished by its social and environmental sustainability and its premium quality. The logo is inspired by the ‘Chakana’, or Southern Cross, and serves to illustrate the five pillars of Ecuador’s agricultural sector; reflecting the country’s agricultural vision for the next 10 years.

Minister Lazo will present the marque at Fruit Logistica during a press conference on Wednesday 5 February at 11.30am in the Press Center, Hall 6.3, Room B, to demonstrate the real action undertaken across Ecuador to modernize fruit production processes, strengthen quality controls and raise sustainability efforts, particularly within the banana sector.

In celebration of being named the official Fruit Logistica Partner Country for 2020, Ecuador is bringing to Berlin its biggest-ever delegation, including the Vice-President of Ecuador, Mr Otto Sonnenholzner; Ecuador’s Minister of Production, International Trade, Investment and Fishery, Mr Ivan Ontaneda; and Ecuador’s Environment Minister, Mr Raúl Ledesma.

Also present for Ecuador’s 18th appearance at the international produce exhibition will be trade organisations PRO ECUADOR, CORPEI (Ecuadorian Corporation of Exports Promotion and Investments) the Ecuadorian banana cluster (formed by banana associations AEBE, Acorbanec and Agroban), Ecuador’s National Institute of Agricultural Research (INIAP) and Ecuador’s Phytosanitary and Animal Health Control and Regulation Agency (Agrocalidad).

Across the three-day show, suppliers will seek to establish new contacts in both the wholesale and retail channels, and especially with importers seeking high quality and sustainable produce. As a result of Fruit Logistica 2020, Ecuador estimates it will generate sales of more than US$21.8 million.

In recognition of Ecuador’s status as the largest banana exporter in the world, half of Ecuador’s overall delegation will comprise suppliers of bananas, baby bananas, red bananas and plantain. Furthermore, as Ecuador’s continues to diversify its commercial fruit export offer, a greater number of suppliers will showcase produce including: pineapples, mangoes, Hass avocados, dragon fruit, physalis, papayas and pepino melon, among others. All products to be presented are grown under the Ecuador: Premium And Sustainable banner.

Following the ‘Ecuador: Premium And Sustainable’ press conference on Wednesday 5 February, PRO ECUADOR will launch its ‘Exquisite Ecuador’ website, which showcases Ecuadorian gastronomy using exotic fruits. PRO ECUADOR’s Vice-Minister Veronica Chávez and Ecuadorian Chef Carlos Gallardo will make the announcement at the PRO ECUADOR stand in Hall 23, E-08, at 12.10pm. A drinks and canapé reception will follow, allowing attendees the opportunity to try Ecuadorian cuisine.

For more information in English or Spanish about the ‘Ecuador: Premium And Sustainable’ brand, visit: www.balcon.mag.gob.ec/ecuadorfruitlogistic/

ABOUT PRO ECUADOR

PRO ECUADOR is the promotional arm for exports and investment of Ecuador’s Vice-Ministry for Export and Investment Promotion, and Ecuador’s Ministry for Production, International Trade, Investment and Fishery. PRO ECUADOR operates a network of trade offices worldwide. www.proecuador.gob.ec

Source: Press release
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Ecuador’s banana sector calls for higher prices to reflect new scenario

Calls for supply regulation to protect banana prices 

As annual contracts with retailers are renegotiated, Ecuador’s banana industry (represented by ACORBANEC, AEBE, AGR) has released a statement regarding prices. ReeferTrends reports that German retailer Aldi has announced it will increase its buying price for Ecuadorian bananas in 2020. While the Ecuadorian banana industry welcomes the move, it feels that this rise does not fully reflect the current situation. In 2020, there will be the introduction of a Bunker tax on shipping fuel that will increase costs for suppliers, while there is also the need to take measures to prevent the spread of the Foc R4Tdisease. The press release also highlighted the incongruence of German apples costing up to three times more in German discounters than Ecuadorian bananas shipped from another continent.

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Ecuador’s banana exporters look beyond EU

Calls for supply regulation to protect banana prices 

Despite problems with the EU market and adverse winter conditions, Ecuador recorded a 2% year-on-year increase in banana exports during the first quarter of 2019, shipping 95.3 million boxes. However, Ecuador’s banana exports to the EU dropped 15% in the first three months of the year, according to the Banana Marketing and Export Association (ACORBANEC). The fall in shipments is attributed to cheaper competitors like Guatemala. Administrator of ACORBANEC, Richard Salazar, said, “Ecuador’s current law guaranteeing a minimum price for producers makes its bananas much more expensive than its competitors. Guatemala is selling cheaper bananas at about 50 cents less than Ecuador and that has made some customers from abroad, especially Germany, prefer to buy more from other Central American countries. Ecuador has not lowered its prices – it sells them at the same price. But the reaction was to buy more from the competition because we are much more expensive.”

The EU accounts for 29% of Ecuador’s banana exports, followed by Russia (23%), the Middle East (12%), the US (11%), Asia (7%), and South America (6%). China and Japan have increased purchases of Ecuadorian bananas this year, shifting away from the Philippines where production problems were encountered. Similarly, the Middle Eastern markets increased imports by 11%, according to ACORBANEC.

 

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Germany looks to alternatives to expensive Ecuadorian bananas

Calls for supply regulation to protect banana prices 

Due to the high price of Ecuador’s bananas, exports to Germany have dropped by 20-25% in 2019, according to industry sources. German retailers are instead looking to buy cheaper alternatives from Central America, like Guatemala. The relatively high prices of Ecuadorian bananas are due partly to the country’s government setting a minimum sales price and partly due to the higher shipping costs from South America, from where ships must pay to cross the Panama Canal. On October 26, 2018, the Ministry of Agriculture of Ecuador set the minimum price for 2019 at US$6.30 per 20 kg box of bananas.

Europe and the US account for around 45% of Ecuador’s banana exports. The bananas no longer purchased by Germany are heading to Russia and other markets in Europe and the US. Ecuador’s banana production has increased on average by 17% over the past two years.

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Ecuador’s banana exports drop 13%

Ecuador exportaciones semanales

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.

Meanwhile, Australian banana producers are looking at the possibility of exporting to the Philippines with import protocols in the pipeline. However, industry experts are doubtful about the current state of the Australian domestic banana market, with low demand causing an oversupply and a lowering of profits. Production costs are considered to be rather high in Australia, thereby impeding the country’s producers’ efforts to compete on the international scene.