The yellow tide: a catastrophic summer for banana prices

By Marie-Pierre Olphand

At less than ten euros per 18.5kg box this summer, bananas have plummeted on the market. In the ten years that the Fruitrop economic unit has been publishing its barometer of European import prices, such a low level has never before been reached at this time of year. You have to go back to 2011 to find such a catastrophic summer in terms of prices on the European continent.

excessive offer

These prices are, as is often the case, a reflection of abundance. Plantations have increased considerably in recent years, especially in the dollar banana zone, that is, on the other side of the Atlantic, and exports from the four main Latin American suppliers (Ecuador, Costa Rica, Guatemala and Colombia) have skyrocketed . As a result, a yellow tide is sweeping the market, and nothing seems to stop it at the moment. Not even the two hurricanes at the end of 2020 in Honduras and Guatemala managed to shake the market for more than a few weeks.

These minimum prices affect professionals in areas where production is more respectful of social and environmental standards and where producers are necessarily less competitive. The risk is the disappearance of certain varieties, with an inevitable reduction in the number of small farms that do not have the resources of the large structures capable of responding to tenders from European distributors, which increasingly drag down prices. In the Ecuadorian countryside, people are also beginning to protest the drop in sales prices while production costs, especially electricity, increase.

"Today, the margins of producers, importers and ripeners are almost zero, it is a massacre for the sector," says Denis Loeillet, researcher at CIRAD (Centre for International Cooperation in Agricultural Research for Development). Who can resist? at such low prices?

Organic bananas are not immune to turbulence

In this context, the price difference between organic and conventional bananas has also narrowed considerably. And this is not a good sign. And it is that the low prices of organic bananas inevitably raise doubts about the quality of the systems that produce this fruit. "We would like to know how suppliers manage to keep their prices so low," says our interviewee. Because below a certain price, organic can only be fake. It is an organic system that certainly prohibits phytosanitary products in order to obtain certification, but that cannot respect the soil fertilization standards, which must be organic and not mineral in the sector, because this fertilization has a cost. That's why today's overpriced organic bananas are doubly suspect.