The decline in the signing of the agreements is reflected in week 50, compared to the same period in 2020, the Ministry reported.
The banana sector is generating controversies again, this time due to a decline in the signing of contracts between exporters and producers that the Ministry of Agriculture and Livestock (MAG) warned in a statement sent by Ángel Carranza, Undersecretary of Strengthening of Musáceas to exporters.
According to the official, “in week 50 of this fiscal year, it has identified a record of contracts by its clients, 30% below the volume they had registered in the same week of the previous year.”
Producers: Around 114 million fewer boxes of bananas are estimated for 2022, if the price remains at $ 6.25
Given the situation, Carranza urged exporters to solve the inconveniences that generate delay in signing contracts.
They also warned to cease the activities of those who are not complying with the law, by making a call “to comply with the provisions of the Ecuadorian legal system in relation to the banana field, and that, therefore, they can continue with their active records, particular that will allow them to continue with their economic activity ”.
About, Franklin Torres, president of the National Federation of Banana Producers of Ecuador (Fenabe)Like the MAG, in its statement, it cited Article 1 of the Banana Law, which indicates:
“All producers, marketers and exporters will be obliged to sign purchase and sale contracts for the fruit and the clauses freely and voluntarily agreed by the parties will be respected, provided they do not contravene this Law and its Regulations. The exporter that does not sign a contract with the producers and / or traders will not be able to export ”.
In this context, Torres assured that unfortunately the export sector and some MAG officials have not complied with the law, by ensuring that contracts are now offered below the minimum support price (PMS), which is $ 6.25, which is which he called illegal.
Price of a box of bananas remains at $ 6.25
“It would be good for the MAG to clarify how much is the percentage of contracts signed for 2020 and 2021; how the boxes of bananas come out, if the law only allows them to come out through contracted fruit; how the final shipping programs are approved, if they are mostly false “, denounced the union leader, who assured that the percentage of 30% less in the signing of contracts has occurred in the last two years and that” the Most of the signed contracts were breached by the exporters for whatever pretext ”.
Torres denounced the fruit exports called spot, without contracts, which he also classified as illegal.
“The exporter pays whatever price he wants, if at all. (There are) hundreds of complaints in recent years due to the administrative inoperation of the Ministry, which is used by some bad exporters to satisfy their ambition for money and power, “said the president of Fenabe, who, however, clarified that there are a few exporters that do want to comply with the law, especially the transnationals.
For its part, José Antonio Hidalgo, executive director of the Association of Banana Exporters of Ecuador (Aebe), He recalled that the banana sector represents 4.2% of the country’s Gross Domestic Product (GDP) and that this year exports will close with -3.41% in number of boxes and -5.83% in FOB value.
Regarding what was indicated by the MAG, he assured that the export sector faces pressures due to various exogenous factors that supermarkets in international destinations are not willing to compensate, which always complicates contract closing times.
The manager cited some of these factors, such as the 45% increase in fertilizers, 50% cardboard, 45% plastic, 62% of freight, among others.
“Many of the retail chains are not willing to assume all these impacts, and this is something quite serious, we are pressing at the national level for there to be a shared responsibility for all these impacts and obviously these negotiation processes are taking much more time”, Hidalgo explained, who assured that the authorities must provide the sector with compensation and competitiveness tools to have a better opportunity in international markets.
In addition, Hidalgo adds internal investments, such as measures to prevent Fusarium Race 4, which represent between $ 2,000 to $ 5,000 per hectare; and the impact of the salary increase.
Meanwhile, among the compensation measures that they ask the Government, Hidalgo cited the payment of the Drawback (return of taxes), the total reduction of the ISD and the Income Tax of the freight; and the reduction of 170 tariff items for the agricultural sector, which were sent to the Minister of Production, Foreign Trade, Investment and Fisheries on July 21.
Hidalgo called “to unite with all the voices and not to point the finger internally who is the culprit if we depend on an international market”, noting that the banana is one of the sectors with the highest tax burden in the country with $ 470 million, which exceeds 10%, in addition to a single monthly tax. (I)
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