Less than five weeks before the end of 2022 and 18 days after the Ministry of Agriculture and Livestock (MAG) published Ministerial Agreement 125 with the minimum support price of $6.50 and the FOB price of $8.66 For the 43-pound box for export for 2023, which was agreed on September 19, the fruit contracts to date reach only about 40%.
The remaining 60% remains uncertain due to the resistance of the producing sector to sign them. This, due to the high prices spotswhich reach up to $13 per box depending on the day of the cut, which producers seek to take advantage of.
Banana producers ask for a bonus per box to “be encouraged” to sign contracts
After the issuance of Ministerial Agreement 125, both sectors met again last week to try to reach a new consensus and unlock the signing of contracts. Nevertheless, Richard Salazar, executive director of the Ecuadorian Banana Marketing and Export Association (Acorbanec)confirmed that to date there is no agreement between the parties.
“The situations were exposed, where the producing sector is ratified, apparently it is reluctant to sign contracts due to the issue of price spots; However, it is necessary, in accordance with the regulations, to sign contracts to be able to export,” said Salazar, who announced that during this week and the next there will be meetings with the MAG to define the actions for 2023.
However, despite the stagnation and lack of consensus with the producers, the executive director of Acorbanec assured that they are “trying to sign with several producers, they are already signing the same, but most of us are about to define the signature.”
While, Franklin Torres, president of the Federation of Banana Producers of Ecuador (Fenabe), confirmed the position of his sector to request a bonus to sign contracts with exporters.
“The producing sector asks for a bonus of $1 for each box of bananas during the first six months and to set the FOB cost at $2.80,” said Torres, who, like Salazar, hopes to meet with the head of MAG, Bernardo Manzano, to elucidate the situation.
They have also requested “compliance with the Banana Law, compliance with the payment of the minimum support price during 2023, without discounts. That is what the export sector has committed to, let’s wait and see if they comply on this occasion”.
After denouncing a fictitious farm in the name of MAG, producers ask to be compensated for three years of fraud; exporters, that the Banana Law be reformed
About, José Antonio Hidalgo, executive director of the Association of Banana Exporters of Ecuador (AEBE), He affirmed that any subject related to bonuses must be discussed in a private meeting between producers and exporters “according to the market and according to the certifications they have.”
However, he assured that the MAG should make a call to protect the formality of the value chain, emphasizing the importance of signing contracts.
“The lack of willingness to sign contracts not only goes against the law, but also exposes the various externalities of a volatile market and prevents the exercise of reasonable claims and shows that the various complaints that could be made do not have a valid foundation” , explained Hidalgo, who assured that just as the signing of contracts was required during 2022, the MAG must insist on achieving the common objective of formality for the general well-being of the entire banana industry.
Exports continue to decline
Meanwhile, while exporters and producers do not agree on the contracts for 2023, exports for 2022 continue to decline.
According to figures from the Association of Banana Exporters of Ecuador (AEBE), banana exports from January to October of this year were 292.01 million boxes of bananas, which represented a drop of -7.50%, that is, a reduction of 23.69 million boxes of bananas compared to the same period in 2021 when exports were 315.70 million boxes of bananas.
From January to August, banana exports continue to fall, a trend that would continue with a negative closing of 2022, with at least -8%
Regarding the destinations, of the 292.01 million boxes of bananas exported, the European Union covers 26.32% of the participation of global exports, positioning itself as the main export destination, although a reduction is also evident in this market, since In 2022, a total of 76.86 million boxes were shipped, in contrast to 2021, exports were 85.31 million boxes, which represents a reduction of 9.72%.
The second destination for banana exports was Russia with 22.97%, representing a shipment of 67.07 million boxes. By 2021, accumulated exports to this same destination reached around 68.93 million boxes, which represents a drop of 2.70%, that is, a decrease of 1.86 million boxes.
On the other hand, the Middle East region reported an increase in its level of purchase of Ecuadorian bananas. In this year, an additional 2.57 million boxes were exported to this region, reaching 45.95 million boxes this year. (YO)
Source: Eluniverso
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