by Lora Abcarian, The Produce News
Bananas continue to maintain a commanding presence in produce departments and consumer shopping carts. “Bananas claim over 50 percent of the volume of fresh fruit imports,” said the U.S. Department of Agriculture’s Economic Research Service. “Excluding bananas, fresh fruit imports rose from 12 percent of domestic consumption in 1990 to around 25 percent during 2005-10. Sold year-round in the domestic market, bananas rank number one in U.S. per capita fresh fruit consumption, followed by apples and oranges. To meet U.S. demand, bananas are imported, primarily from Guatemala, Ecuador, Costa Rica, Colombia and Honduras. Excluding bananas, fruit imports increased an average 7 percent annually over the past two decades.”
ERS further noted that, “Although U.S. fruit exports have shown strong growth, the United States has remained a net fruit importer. U.S. fruit imports rose during the last three decades, partly owing to the growing minority ethnic populations in the United States and to an increased demand for new products. Not only have imports expanded for commodities already produced domestically and created competition for U.S. producers, but imports have also increased for nontraditional fruits, especially many tropical fruits.”
Agnes Perez and Kristy Plattner, authors of the U.S. Department of Agriculture publication “Fruit and Tree Nuts Outlook,” published on March 27, provided some insights about banana pricing. According to Perez and Plattner, the January consumer price index for fresh fruit rose 2 percent when compared to January 2014 and remained relatively unchanged in February. Despite these overall increases, banana pricing showed a decline.
“Banana retail prices fell below a year ago in January despite an 8 percent decline in import supplies,” they reported. “Greater volume at the end of last year likely provided a buffer for supplies going into 2015, but the cold weather may have also slowed demand. [Agricultural Marketing Service] data indicate import shipments through early March continue to run behind a year ago, including volumes from major U.S. sources for imported bananas such as Guatemala, Costa Rica and Honduras, likely supporting prices.”
Perez and Plattner reported that the unit price of a pound of bananas in January was $0.583 and $0.591 in February.
The dust continues to settle following the news that the globally recognized Chiquita brand bananas had been acquired by Cutrale and Grupo Safra. Alistair Smith, international coordinator for Banana Link, wrote his observations about the acquisition on Jan. 20. “The news has implications for hundreds of thousands of people involved in producing Chiquita brand bananas,” he said in an article published at freshfruitportal.com. “A quick look at history gives us a glimpse of the potential contradiction that this latest big step towards the ‘Latin Americanization’ of the banana industry represents.”
According to Smith, Cutrale accounts for one third of global orange juice trade and, along with Safra, has acquired Chiquita Brands International’s interests in pineapple and other juices.
“It is reported that the U.S. $1.3 billion price tag for Cutrale and Safra — more than double the original bid last August — includes a compensation payment to Fyffes for losing the race to acquire Chiquita stock,” Smith stated. “What is less sure, however, is where the new company will go in the near and longer-term future. A question which transcends the significance of any big numbers, though, is: what will the new owners and management do with the last much more positive 15 years of Chiquita’s history?”
According to Smith, questions regarding Cutrale’s commitment to improving worker and trade union relations have been raised. “The signal from Cutrale in particular will also be watched and analyzed very closely by many whose livelihoods depend on the scenarios now unfolding. But the orange juice king has a real golden opportunity to make good history. Many will be there to support such a process and build on Chiquita’s leadership in setting up the ground-breaking World Banana Forum,” he said.
On April 20, CentralAmericaData.com reported that Del Monte is interested in making financial investments to revive banana production in Baru, Panama.
“Previous negotiations were suspended earlier this year when the sale was announced of Chiquita Brands to the Brazilian consortium Cutrale-Safra, who requested an extension of the deadline for negotiations until next December,” the organization wrote. “However, the company Del Monte has also shown interest in reviving the banana lands, and will be reviewing and updating its proposal for presentation at the next meeting.”
Isaiah Bonilla, president of the Association of Agricultural Producers said the investment would range between $36-40 million.
Source: Produce News