W4 Banana Update: Ecuadorian Banana Exports Reached 355 Million Boxes in 2023 Season, Rising Concerns in Peruvian Banana Exports, and Vietnam Facing Oversupply Due to 40% YoY Shipment Dip to China

Ecuador's Banana Exports Soar to 355 Million Boxes in 2023 Despite Challenges

According to DataComex and the Banana Statistical Observatory (OEB), Ecuador's banana exports reached 355 million boxes in 2023, a 5% year-on-year (YoY) increase from the previous year. The European Union (EU) was the leading market, receiving 28.42% of exports totaling 100.77 million boxes, a 14.61% YoY rise from 2022. Russia ranked second, accounting for 21.12% with 74.90 million boxes, a slight 3% YoY decline. Africa and Asia saw increased demand, with an additional 4.86 million boxes exported to Africa and 4.21 million to Asia. Despite positive export figures, rising insecurity in Ecuador's main producing regions impacts the banana value chain, affecting logistics and security, and leading to higher costs and operational risks. Political turmoil and logistical hurdles, such as diversions resulting from the Red Sea conflict and restrictions in the Panama Canal, added complications. This has led to repercussions on delays in delivery schedules and the profitability of exporters.

Ecuador’s Minimum Banana Price Sparks Concerns for Peruvian Banana Exports in Key Markets

Ecuador’s introduction of a minimum price for bananas at USD 6.85 per box presents a potential obstacle for Peruvian exports, particularly in the Dutch and North American markets, where Ecuador holds a significant role. In Nov-23, Peruvian banana exports recorded a volume drop of 7% YoY, reaching 10.16 thousand metric tons (mt), but a value increase of 3% YoY to USD 7.9 million. The average price improved by 10% YoY, reaching USD 0.77 per kilogram (kg). Significant destinations included the Netherlands with a 38% share, the United States (US) with 13%, and Italy with 10%. Despite positive figures, the competitive minimum price set by Ecuador for 2024 may impact Peruvian exports to key markets.

Vietnamese Street Vendors Selling Export Quality Bananas at Discount as Shipments to China Dip 40% YoY

In Vietnam, street vendors in Hồ Chí Minh City are now selling bananas intended for export at a discounted rate of USD 0.24/kg (VND 6,000/kg). Sourced from Đồng Nai, Vietnam's leading banana-producing province, these bananas are flooding the domestic market due to export difficulties, resulting in sluggish sales and declining prices. Banana is Vietnam's third-largest fruit export to China, constituting 10% of total fruit and vegetable exports. While the 2023 season saw rising exports, demand dropped in Dec-23 due to favorable winter conditions in China and heightened competition from other supplying countries. At the start of 2024, Vietnamese banana exports to China experienced a sharp decline of almost 40%, leading to financial losses for growers grappling with oversupply challenges expected to persist for the next one to two months.