While the demand for bananas in Europe usually falls in the summer months, this year it has actually remained stable. Competition from summer fruit is minimal, due to the cool summer. At higher temperatures, the demand for summer fruits grows and there is not as much demand for bananas. There is also traditionally a lower demand in the holiday period, which is around the corner. In several countries, especially in southern Europe, this drop has already happened. On the other side of the ocean, the American market also usually sees a drop in demand as summer fruit hits the market.
Brazil: Prata banana continues growing
Thanks to a price drop, the Prata banana, the most widely grown variety in Brazil, is now in a better position to compete with the Cavendish. While Prata bananas used to be twice as expensive as the Cavendish, the price difference is now of about 40 cents, with prices standing at 1.30 Real for the Prata and 0.91 Real for the Cavendish.
The Brazilian consumer has learned to appreciate the Prata over the last 25 to 30 years. The variety has taken about 50% of the market share. According to a trader, there are regions where entire plantations have switched to the Prata. Work is also underway to export to places like Dubai, France, Belgium and Portugal, but since the ripening process is different than that of the Cavendish, there is a need for marketing.
Mexico sees opportunities with organic bananas
There is a growing demand for organic bananas. While many organic products are considerably more expensive than the conventional version, that difference is relatively small for bananas. It is therefore expected that demand will continue to increase in the coming years and that production will have trouble keeping up with demand. A trader estimates that there are five million hectares of conventional bananas worldwide, compared to just 50,000 hectares of organic crops.
The cultivation of organic bananas is therefore more difficult than the conventional. Growing bananas requires a lot of water, about 3,000 mm per year. That is not a problem in the tropics, but the production of organic bananas has to be diverted to areas with less rainfall. Black Sigatoka also thrives in the tropics and there aren't any biological plant protection products available. Organic farming is also found in regions with less rainfall and lower humidity, but with an abundance of surface water. One of the regions where bananas are produced organically is Colima. Moreover, the production costs are approximately twice as high.
The North American country has around 80,000 hectares devoted to bananas. Historically, the production is mainly intended for the domestic market, but in recent years there has been a greater focus on exports. The US, in particular, has become an attractive export market.
Guatemala focuses on baby bananas
In Europe and the US, baby bananas are still seen as exotic, but in Guatemala they see great potential in this small banana. According to traders, the taste is much better than that of regular bananas. Most of these bananas are shipped via multinationals to the US, but lately there have also been exports to Europe. Last year, the product first entered the French market. Europeans know baby bananas, but these are still considered an exotic species. Also, Guatemala is a new country in the European banana market.
Prices are fairly stable and higher than those of regular bananas. While in the first part of the year production was lower due to the weather, it is possible to grow the fruit all year round.
Costa Rica benefits from deficit
This year, the weather in Costa Rica has been favourable for the country's banana producers. Furthermore, demand has increased. A grower with 1,120 hectares of banana plantations says that this year's production will amount to around 2 million boxes. Traders are taking advantage of the reduced harvests in countries such as Ecuador and Colombia. Black Sigatoka is a problem in humid Costa Rica, but for now they have managed to cope well with the disease.
Jamaica focuses on exports
Exports remain relatively small, but they are on the rise. Last year, the country's export volume increased by 32 percent, from 199 tonnes to 263 tonnes. The total banana production amounts to a little under 55,000 tonnes. The main export market is the Cayman Islands, with 160 tonnes of exports. There are also shipments going to Canada and the United Kingdom. The government is investing in banana cultivation and aims to increase both the production and exports.
Ecuadorian market stable
In Ecuador, the harvest has been delayed by a few weeks due to changes in the weather. Temperatures have fallen two degrees below average, and as a result, the production has declined. Additionally, demand from Europe will fall because of the start of the holiday season on the continent. Demand is currently stable, with a decline observed already in week 18. When it comes to prices, we see a similar picture. Usually, prices in this period are low; at present, however, the price stands only $ 1 below average and amounts to $ 6.50 per box. Ecuadorian exporters suspect that this is because other countries in the region are supplying fewer bananas. There is also rising demand from countries such as Japan, South Korea and Dubai.
Colombia invests in bananas
The production, according to traders, has grown by 13%. Europe remains the most important market, accounting for about 70% of all sales. Second, the US market with a share of 18%. Prices are pretty good and there are no reported changes in demand. The government is investing to increase production. The aim is to devote 20% of the conflict zones to the cultivation of bananas.
More demand for organic bananas from Peru
Because of climate changes, production has fallen. In the past three weeks, the temperature has been 3 to 4 degrees below average. This has consequences for the harvest; which has been delayed. Production has declined, but demand has increased, especially for organic bananas. Growers are struggling to meet demand. The demand will fall in the coming weeks. This year, both production and exports are expected to grow by about 10 percent.
Poor infrastructure hinders exports in India
June and July are the peak months for the Indian banana production for both the domestic and the export markets. A trader says that the country is one of the largest banana growing regions in the world, but that only a very small volume goes to the international market. The main reason for this is the poor logistics facilities and infrastructure. Import duties protect domestic producers against foreign fruit. Indian banana exports go mainly to the Middle East and the Gulf region.
Quality problems with import bananas in China
Most import bananas are shipped from the Philippines and Ecuador. Currently, the Philippines is still the largest supplier of bananas, but Ecuador's market share is on the rise. There are also some small imports from neighbouring Thailand, Vietnam, Taiwan and Indonesia. Domestic crops can be found in the southern provinces, including Hainan. The season kicks off in August.
The supply of bananas is more difficult this year. El Niño has taken a toll on banana crops in both the Philippines and Ecuador, which in turn has implications, among other things, for the quality during transport. The imports from the Philippines usually enter China through Shanghai, while Ecuadorian bananas arrive via the port of Dalian. Within China, the largest markets for banana traders are in the north east of the country, in big cities like Beijing and Shanghai. The summer months are generally quiet, which normally has an impact on the price. This year, however, prices have remained stable due to the lower supply. No changes are expected in the market conditions in the coming weeks. In autumn, when the temperature drops, the demand will grow again.
Logistical problems Indonesia
The emerging middle class in the country is giving rise to a new market for fruit traders. This group has distinct consumption patterns, which creates opportunities. To protect the local crops, restrictions have been imposed on the import of bananas. The disadvantage of this scheme is that the market is unable to completely meet the demand, since the domestic production is too small. Logistics is a challenge for the sector. Transportation costs quickly get expensive because of the cost of shipping from one island to another. The current government is investing in better infrastructure.
Despite the good conditions in the domestic market, some small exports are made to countries in the region, including Japan and China. Some volumes are also shipped to the Middle East. El Niño is making things difficult for the growers, as the weather phenomenon causes drought.
United States; higher prices
Prices in the United States are higher than usual. A trader says that up to $ 20 are paid, when prices would normally stand at around $ 15. At the beginning of the year, prices were higher at the various wholesale markets, but since May, these have remained stable. Just like in Europe, banana sales in the US are affected by the arrival of summer fruit.
Israeli cultivation on the rise
The mild winter and mild spring have been good for banana growers. In the domestic market, a total of around 150,000 tonnes have been marketed. The entire harvest is intended for the domestic market. Despite the increased supply, demand has remained high and prices have been stable at around the usual 2.50 to 3.50 Euro per kilo.
The market is growing and the production volume is growing along. The country has 2,400 hectares of banana plantations. These crops are located in the northern coastal regions and the north of the Jordan Valley. Each year, the acreage is increasing by about 50 hectares. The most effective cultivation method is under nets; growers are investing the most in this, thus further increasing production.
Growers fear the Panama Disease. The disease has not been detected in the country, but neighbouring countries have been hit by it. The disease got a foothold in Jordan and Lebanon, not far from the Israeli crops. Israel is therefore planting new varieties that might be resistant, including the Williams and Grand Nine, which have been successfully introduced to the market. Work is also underway on resistant varieties.
Fairtrade bananas popular in Italy
Within Europe, Italy is the fourth largest market for bananas, which are imported directly from Ecuador, Colombia and Costa Rica. Again, demand for bananas declines during the summer months; however, prices on the wholesale markets remain stable at around 1 Euro, with some very small fluctuations. Prices also depend on the brand, with Chiquita bananas reaching the best prices on the wholesale markets. Dole bananas are the cheapest on the wholesale market in Fondi, with prices of 85 cents per kilo for a box of 18 kilos. The market continues to grow for Fairtrade products in Italy. Of the 99 million Euro that Italians spent last year on these products, half corresponded to bananas. The market absorbs about 10,000 tonnes of fairtrade bananas.
British banana market stable
The British market has barely noticed the lower supply from Ecuador. A trader explains that imports arrive from several countries in Latin America, so there have been no shortages. "On the spot market, prices have been quite high," explains an importer. The market is stable all year round, despite a small peak in early summer, followed by a slight dip during the holiday season. In the winter months, the demand increases. Growing sales of other fruits do not adversely affect the demand for bananas.
Although supermarkets have plenty of promotions, they pay a fair price, according to an importer. He argues that, otherwise, bananas wouldn't be supplied to them.
Belgian and Dutch market prefer summer fruit
In the summer months, the banana market is generally quiet in Europe. The holidays and the competition from summer fruit lead to falling demand. Currently, however, there is little evidence of this trend in the Belgian market. Because of the autumnal weather, demand has remained stable and prices have stayed around the level of the winter months. A trader states that, in these months, they would rather sell summer fruit, but demand for peaches and nectarines, for example, is small. As soon as the temperature goes up, the demand for summer fruits should also increase.
Preparations are underway for the traditionally quieter summer for Dutch banana sales. In the winter, sales were relatively stable. In the summer months there is always competition from summer fruit, but the negative impact has been limited this year. The warmer it gets, the fewer bananas are consumed. This is resulting in stable price levels. Importers are alert to prevent smuggling, mostly of drugs, in banana containers.
Summer fruit displaces bananas in the French market
Like elsewhere in Europe, the demand for bananas in the summer months is lower than in the rest of the year. Partly because of promotions, stonefruit and melons are doing well and these fruits are in direct competition with bananas; however, these developments are normal.
Polish demand good due to cool summer
Due to the lower supply from Latin America, there has been no sign of the drop in prices which is usually recorded after Easter. Because of the pressure to supply bananas, prices have actually increased. An importer says that their Ecuadorian suppliers are managing to sell the bananas for a higher price than that set by the government. "Things are looking good for the growers," states the importer. Those importers who failed to sign adequate contract must now pay high prices on the spot market. Despite the competition from summer fruit, demand for bananas remains high. Here, the cool summer is also playing a role.
Icelandic banana market has no summer dip in demand
The holiday dip observed in the banana market in many European countries has been a thing of the past in Iceland for some years. According to an importer, the main cause is the sharply increasing number of tourists visiting the island during the summer months. These tourists come for outdoor sports and often take a banana for the road.
