Costa Rica’s Banana industry, at Risk by Proposed Price Cuts in Europe

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By LatAm Reports Editor

The banana industry of Costa Rica sees 2024 with “uncertainty” due to logistical and climatic problems as well as the position of European supermarkets to request reductions of up to 8% in the price of fruit.

For 2024 there is a strong uncertainty about logistical aspects due to the situation of the Panama Canal that could affect everyone, both users and non-users. Added to this is the phenomenon of El Niño, which is projected to have global consequences, said the National Banana Corporation of Costa Rica (Corbana) in a statement on Tuesday.

Corbana demanded better prices in Europe, especially supermarkets, and not to resume the downward purchase price strategy they had recently tried.

Hundreds of thousands of families in Costa Rica and Latin America depend on the activity and export of bananas, their sustainability is of the utmost importance for areas that have few job options, so we are requesting an attitude of shared responsibility that allows to distribute the impact along the supply chain and that it is not the producers who assume the full burden,” said the general manager of Corbana, Jorge Sauma in the statement.

Corbana also explained that a significant increase in raw materials has been announced to manufacture the cardboard box. He added that the prices of inputs such as cardboard and plastic do not yet reach the pre-demnation levels of the covid-19 pandemic.

The entity detailed that the specialized media Reefer Trend reported on December 8 that European supermarkets are requesting a reduction of 1.30 euros ($1.43) per box in the price of bananas, from 16.30 euros ($17.99) the cash to 15 euros ($1.55) on the grounds that there are reductions in the shipping cost and for the strengthening of the euro against the dollar.

With the events that took place by 2023, the banana industry considered that the supermarkets had rethought not to bring the price of the banana box to ruinous levels, and that they had understood the request of Costa Rica and other Latin American countries for shared responsibility in the banana distribution chain, says Corbana’s statement.

Corbana pointed out that Costa Rica’s is – the best in the world because it comes to terms with sustainable social and environmental policies – and that in the country – the best wages in the agricultural sector are paid.

Official data indicate that the banana sector generates about 40,000 direct and 100,000 indirect jobs in Costa Rica.

Costa Rica is one of the three largest banana-exporting countries in the world with annual sales abroad of about 120 million boxes, representing about $1 billion.

The most recent official data indicate that as of October 2023, banana exports reached $985 million and exceeded its entire 2022 when it was $982 million.

Since 2016 Costa Rica has exported more than $1 billion a year in bananas, with the exception of 2022.

This article has been translated from the original which first appeared in El Mundo