1. Weekly News

Colombia

Colombia Boosts Efforts to Combat Banana Diseases

In Santa Marta, Colombia, a workshop focused on preventing and monitoring banana diseases, mainly Fusarium Tropical Race 4 (Foc TR4), was held to train agronomists and technicians from banana-producing regions. The Colombian Agricultural Institute (ICA) and Association of Banana Growers of Magdalena, La Guajira and El Cesar (ASBAMA) organized the initiative to strengthen disease surveillance in primary areas like Magdalena, La Guajira, and Cesar. This effort is vital in safeguarding Colombia's banana industry and mitigating the impact of Foc TR4 on exports.

Peru

Peruvian Banana Exports Decline Despite Rising Prices in Sep-24

In Sep-24, Peru's fresh banana exports fell for the second consecutive month, shipping 10.7 thousand tons valued at USD 8 million. This represented a 10% year-on-year (YoY) decrease in volume and an 11% YoY decline in value, even as the average price per kilogram (kg) rose by 9%, from USD 3.91 in 2023 to USD 4.26 in 2024. The Netherlands remained the largest market, importing 3.5 thousand tons despite a 3% YoY drop in volume and a 5% YoY decline in value. Conversely, the United States (US) experienced substantial growth in banana imports, with a 68% YoY increase in volume and a 73% YoY increase in value, now making up 23% of Peru's total banana exports. Italy maintained a stable 10% share but reported a 12% YoY decline in volume and an 8% YoY drop in value.

Russia

Rising Banana Prices Expected in Russia Due to Ecuador’s Supply Issues

In the coming months, banana prices in Russia are expected to rise significantly due to supply challenges in Ecuador, one of the largest global banana producers. A conflict has arisen between Ecuadorian banana producers and the government over the officials' refusal to lower state banana prices. Additionally, drought has severely affected Ecuador's banana harvest, resulting in a 30% decline in profitable contracts for local growers. Consequently, wholesale prices have become volatile, fluctuating between USD 1.50 and USD 2 weekly. Facing potential bankruptcy, Ecuadorian producers are negotiating with the government to raise the state price from USD 6.65 to USD 8.50/kg. These developments have caused retail banana prices in Russia to drop from USD 1.65 (RUB 160) to USD 1.24 (RUB 120), but Russian suppliers anticipate that prices will rebound within the next month.

Tanzania

Kagera Region to Enhance Farmer Incomes with New Banana Markets

The Kagera Region in Tanzania plans to establish new banana markets at the border to boost farmers' incomes. Banana producers in Kagera earn between USD 1.10 to 3.66/50-kg bunch (TZS 3,000 and 10,000/50-kg bunch), which is deemed insufficient. In response, the Head of the Kagera Region has urged the Ministry of Agriculture to create border markets that allow direct sales to foreign buyers and counteract traders' undervaluation of bananas. The Deputy Minister of Agriculture has pledged to prioritize the development of these markets as part of the government's strategy to enhance agricultural exports, supported by an increased budget for agriculture.

Vietnam

Vietnam Overtakes the Philippines as China's Top Banana Supplier in 2024

From Jan-24 to Aug-24, Vietnam became China's largest banana supplier, exporting 459.94 thousand tons worth USD 189.82 million, representing a 19.6% YoY increase in volume and a slight 0.8% YoY rise in value, capturing 40.71% of China's banana import market. Vietnam's banana exports rose due to weather challenges in the Philippines, which reduced production and increased prices. As a result, China has shifted imports toward Vietnam, as well as from Laos, Mexico, and Indonesia, further reducing its reliance on Philippine bananas.

2. Weekly Pricing

Weekly Banana Pricing Important Exporters (USD/kg)

Yearly Change in Banana Pricing Important Exporters (W42 2023 to W42 2024)

Ecuador

Banana prices in Ecuador increased by 4.55% week-on-week (WoW) and month-on-month (MoM) to USD 0.23/kg in W42 due to continued improvement in supply conditions, as the recent rains further mitigated the drought's impact on production output and quality. Additionally, sustained demand from key markets such as the US and the Middle East has supported price growth. However, prices decreased by 4.17% YoY due to the lingering effects of the prolonged drought in 2024, which significantly reduced overall production capacity. Increased competition from Central America and Africa and rising logistical costs contributed to the YoY price decline.

Philippines

In the Philippines, banana prices remained steady at USD 1.24/kg in W42, reflecting a slight decrease of 0.80% MoM due to ongoing supply chain disruptions and adverse weather conditions with limited farm access. Despite these challenges, prices increased by 7.83% YoY, driven by strong demand from key export markets like Japan and South Korea. Producers are still contending with issues such as disease outbreaks and land use restrictions, which have constrained production capacity, leading to a tighter supply that supports the YoY price growth.

Colombia

Colombia's banana prices in W42 decreased by 4% WoW to USD 0.48/kg, reflecting a 33.33% MoM decline due to the continued improvement in production conditions and increased supply following recent rains in drought-affected areas. Additionally, a temporary reduction in export demand after a previous surge has contributed to the downward pressure on prices. However, YoY prices increased by 17.07% due to sustained international demand, particularly from the US and European markets, where Colombian bananas are favored for their quality. Furthermore, tighter supplies in competing regions and an overall rise in global demand for tropical fruits have supported this price increase over the past year.

Guatemala

In W42, banana prices in Guatemala held steady at USD 0.21/kg, showing a 5% MoM increase and a significant increase of 50% YoY. This stability is due to strong export demand from key markets, particularly the US and Europe, which have helped maintain price levels. Improved weather conditions continue to enhance fruit quality and export readiness, allowing producers to meet ongoing demand effectively. Despite previous weather-related disruptions, the recent YoY increase reflects Guatemalan bananas' overall recovery and growing appeal in the international market.

3. Actionable Recommendations

Optimize Export Strategies for the Peruvian Banana Market

Peruvian banana exporters should optimize their export strategies to enhance competitiveness in key markets, particularly in light of the recent decline in overall export volumes and values, especially in traditional markets like the Netherlands and Italy. To boost sales, exporters need to focus on high-growth markets, such as the US, by implementing targeted promotions like seasonal discounts and in-store tastings and improving supply chain logistics through advanced cold chain management and real-time tracking systems to ensure product freshness. Adapting to market dynamics is essential; obtaining quality certifications like Fair Trade can attract ethically conscious consumers while emphasizing sustainability initiatives, such as reduced plastic packaging, can build brand loyalty. By tailoring offerings based on consumer feedback and enhancing quality and reliability, Peruvian banana exporters can navigate current market challenges and leverage growth opportunities.

Enhance Supplier Relationships in Response to Price Fluctuations

Russian banana suppliers should strengthen their relationships with Ecuadorian producers to mitigate the impacts of rising banana prices driven by supply challenges. As Ecuador faces drought and government negotiations affecting banana pricing, suppliers in Russia must establish more reliable sourcing agreements to secure consistent supply and pricing. This can involve diversifying supply chains by exploring alternative sourcing options from other countries or negotiating long-term contracts with existing suppliers. Additionally, implementing transparent communication channels will help manage expectations and enhance collaboration. By proactively addressing these supply issues, Russian suppliers can better navigate the impending price increases and maintain market stability.

Strengthen Vietnam's Banana Export Strategy to China

Vietnamese banana exporters should strengthen their strategies to maintain and expand their position as China's largest banana supplier. This includes enhancing quality control measures to ensure consistent product quality and freshness and diversifying marketing efforts to target emerging consumer segments in China. Additionally, exporters must streamline logistics and distribution channels to reduce costs and improve delivery times. By focusing on these areas, Vietnamese producers can capitalize on China's growing demand for bananas and further solidify their market share.

Sources: Tridge, Agraria, Agriculture, Freshplaza, Eastfruit, Habarileo, MXfruit, Rosng