A month and a half has passed since 2023, and the banana export contracts, which according to the Banana Law had to be signed in full by December 29, 2022, remain an uncertainty for the sector, which is divided into export with contracts or at price stains, that is, without signed obligations, but at the price determined by the market at the time of cutting the fruit.

According to figures from the Association for the Marketing and Export of Bananas of Ecuador (Acorbanec), this price stains – the option preferred by the manufacturing sector and the reason why they hesitate to sign contracts with exporters – hovered in the first six weeks of the year in an average range of USD 10.50 per box, USD 4 more than the minimum support price (PMS) set by the Ministry of Agriculture and Livestock (MAG) for this year, which is $6.50.

However, the price stains it peaked as high as $13.04 per case, as it did in week 4 (January 23-29); while the price stains The highest price in the first six weeks of 2022 was only $7.57 in the sixth week (February 8-14, 2022).

Spot sale of bananas with guaranteed support that enter the MAG is a proposal of the exporter in the absence of a contract

The Ministry of Agriculture extended the contracts to be concluded, the first was until January 15; and now the second deadline has come.

When asked by this newspaper about the details of this new postponement, the State Department explained that it was given “in order to be able to review the contracts that expire in February, maximum in March, and which cannot be abandoned or become non-existent”.

From the export sector, it was explained that these would be contracts that expired in December 2022, and in the absence of signatures of new commitments, they were extended in order to bear fruit until now this year, according to Richard Salazar, executive director of Acorbanec. and warned that this extension expires this week.

The high ‘spot’ price of bananas pits exporters and producers against each other and would complicate contracts for 2023.

While this is happening, the signing of new contracts has been somewhat delayed these weeks, Salazar admitted, although they predict that the contracts will not exceed 30% in total, which ultimately brings the export sector to the reality that 2023 will be a year of mostly sales. place.

“The train for signing the contract is already passing. According to our knowledge, this has already been played out, this year the producers aimed at not signing the contract and selling place. The only thing we have to do now is for MAG to give all the facilities for the export of this fruit, and as a reference take the support of the delivered bond or some other mechanism”, said leader Acorbanec.

On the side of the production sector, they also admit that the signing of contracts with some exporters has increased somewhat. Franklin Torres, president of the Federation of Banana Growers of Ecuador (Fenabe), revealed that some of these agreements have been unlocked thanks to exporters giving in to producers’ demand to pay an additional $1 per box of bananas until the first half of 2023. Producers hope to formalize these contracts in the coming weeks.

“In some cases progress has been made with the signing of contracts, some of the exporting companies are still reluctant to put aside the old practice of reaching into the pockets of producers as the only way to do business. Those with whom the contracts were signed are those who understood that the only way to do business with bananas in the long term is with fair conditions for both parties,” said Torres, who nevertheless clarified that the contracts signed so far are very low. .

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Regarding the resistance of his sector to sign more contracts, Torres assured that they are interested in formalizing the business, but not in the current conditions, in his opinion, completely unfavorable for the manufacturing sector which, according to him, supported illegal discounts, for example as , through fruit assessment, administrative costs, carton transportation, among other things.

“They must disappear, as well as clauses that are totally harmful to the manufacturer, ghost companies, or delegation of fronts for signing contracts. One of the concepts that is the most difficult to explain to everyone is that the minimum price of support is set, that is, it will not be possible to pay less than that value, the maximum price has not been set”, said the leader.