Guatemala Banana Guide

The major points of entry of banana imports in Europe are Germany (Hamburg and Bremerhaven), Belgium (Antwerp) and the UK (Portsmouth), followed by, to a lesser extent, Italy (Salerno and Vado), France (Le Havre and Marseille), and the Netherlands (Rotterdam).

- From there, bananas are re-exported to the other European countries.

On the European and Mediterranean markets, customers (retailers, ripening operators and wholesalers) employ annual or multi-annual arrangements with flexible prices depending on the market conditions. Bananas are sold on a non-official weekly price listing, which frequently varies with the supply, seasonal consumption trends, transport cost, exchange rate and other factors.

 - The banana import markets in Northern European countries (e.g. in Belgium, Finland, Sweden, Denmark or Ireland) tend to be more concentrated around a few importers (usually 5 to 6) who  sell directly to retailers.

 - In Eastern and Southern Europe (e.g. in Italy and Poland), the market is more fragmented (between 8 and 12 leading actors) and banana importers mainly sell their bananas to wholesalers, who in turn distribute these volumes to retailers or outlets in the traditional retail channels (green groceries…)

 - France tends to have market that is somewhat an intermediate of the two above

Certain European operators, like Germany and the UK are starting to be supplied with bananas under a fixed price per box contract. These contracts generally include prices which are higher in the first half and lower in the second half, in accordance with the seasonal supply and demand trends - Long-term contracts are signed with the distribution sector

 - Germany sets up year long contracts at the beginning of the year for fixed price

 - The UK market is quite distinct because of the direct sourcing initiated by several supermarkets

           Buyers of fruit in the UK want unbruised bananas and so very high standards are set. (If the bananas do not meet these standards they are usually sold locally at a much lower price.)

In North America, 90% of banana volumes are sold under contract; the others are sold on the free market.

- These annual contracts have a fixed basic price per box, and also include variable surcharges based on fuel indexes, which are intended to offset changes in transport costs and other fuel-based costs.

*major importers in North America

Guatemala banana's global Export Value is 1.0B (2020), and is 5th largest exporter in the world, hold 8.7% of the global export market. Guatemala is exporting about 40 million boxes per year.

Although domestic banana production is dominated by small producers, at least 80 percent of exports come from large-scale plantations. 

  - In recent years, production has increasingly shifted from the unionized north to the non-union southern region through outsourcing to local producers. It is now estimated that 85 percent of employment is in the non-union southern region.

There are 4 major banana companies in Guatemala - Chiquita, Dole, Del Monte, and Fyffes

  - Most farms work directly, under contract, with a specific label that will later distribute the bananas in bulk to retailers around the globe

  - Today, Chiquita sources less than 40% of its bananas from its own farms

  - Giant supermarket chains Walmart, Tesco, Carrefour, Aldi, and Lidl are increasingly purchasing bananas not only from these large brands but also directly from local producers

  - It is these large transnational banana companies that set prices in the global banana trade

The market share of the 4 historical banana multinationals Chiquita, Dole, Del Monte and Fyffes has decreased from 67% in 2006 to just a little over 40% in 2019

  - Other multinational companies like Compagnie Fruitière (French)and Agroamérica (Guatemalan) and a large handful of big national companies like Grupo Wong (Ecuador), Grupo HAME (Guatemala) or Grupo Acon (Costa Rica) now account for up to one third of all exports.

Below is a brief model describing the supply value change of the Guatemala Banana. 

Main importing countries include the USA, Canada, the Netherlands, Germany, and Italy.

Main Importer Table (2016-2020)

Bananas have a year-round supply, but demand is seasonal.

 -In both the US and the EU (the 2 biggest markets), demand dips in the summer and peaks in fall and early spring (around Sept/Oct and April/May).

In Guatemala, there are 24 weeks in the year when production is low, and they will import from Ecuador to fulfill the different contract volumes.

  -The first and last 12 weeks of the year see low production volumes.

97% of internationally traded bananas come from one single variety, the Cavendish.

Bananas that are shipped take about 10-20 days to reach the EU, about 7-10 days to reach the US, 55 days to reach the Middle East

  - For Asia and Africa – transit time takes a week longer than in South America.

Export is controlled by two entities – multinational corporations or a banana family

  - There are currently three families that will do direct export outside of the multinationals

Extra Class

-Bananas in this class must be of superior quality. They must be characteristic of the variety and/or commercial type. The fingers must be free of defects, with the exception of very slight superficial defects, provided these do not affect the general appearance of the produce, the quality, the keeping quality and presentation in the package.

-Five percent by number or weight of bananas not satisfying the requirements of the class, but meeting those of Class I or, exceptionally, coming within the tolerances of that class.

Class I

-Bananas in this class must be of good quality. They must be characteristic of the variety. The following slight defects of the fingers, however, may be allowed, provided these do not affect the general appearance of the produce, the quality, the keeping quality and presentation in the package:

-Slight defects in shape and color;

-Slight skin defects due to rubbing and other superficial defects not exceeding 2 cm^2 of the total surface area.

-The defects must not, in any case, affect the flesh of the fruit

-Ten percent by number or weight of bananas not satisfying the requirements of the class, but meeting those of Class II or, exceptionally, coming within the tolerances of that class.

Class II

-This class includes bananas which do not qualify for inclusion in the higher classes, but satisfy the minimum requirements specified in Section 2.1 above. The following defects, however, may be allowed, provided the bananas retain their essential characteristics as regards the quality, the keeping quality and presentation

-Defects in shape and colour, provided the product retains the normal characteristics of bananas

-Skin defects due to scraping, scabs, rubbing, blemishes or other causes not exceeding 4 cm^2 of the total surface area.

-The defects must not, in any case, affect the flesh of the fruit.

-Ten percent by number or weight of bananas satisfying neither the requirements of the class nor the minimum requirements, with the exception of produce affected by rotting, major imperfections or any other deterioration rendering it unfit for consumption

Size 

- The minimum length should not be less than 14.0 cm and the minimum grade not less than 2.7 cm

Required Documents:

- Check destination countries in the query data system.

- Registration (exporters and exporting producers in MAG, Banana Unit).

- Registration in the GUÍA system. (ONLY EXPORTERS)

- Have a fruit contract between the producer and exporter.

The exporter hires a Customs Agency, delivers the commercial invoice, and it will be in charge of preparing the necessary requirements to send the merchandise. The Customs of Jurisdiction issues the authorization for export. The transport company of the merchandise is contracted.