December 9 2011, 10:48 Fruit-Inform

Higher prices in Ecuador to intensify crisis in Russian and Ukrainian banana markets

Increase in export prices for bananas estimated in Ecuador may have a negative impact on sales of this product not only in Ukraine, but simultaneously in the whole Europe. Banana consumption in Europe has had a clear tendency to decrease in the past few years. In this season, the negative trend was backed by lower apple prices. In addition, the supply of bananas sharply grew in the global market. Therefore the market experts think that growth of prices in Ecuador will only aggravate the situation with sales in Europe, the region which remains one of the largest target markets for Ecuadorian farmers.

As regards Ukraine and Russia, the demand for bananas in these countries fell even more than in European ones. From summer to late autumn, prices in Russia were record low that was connected with Russian importers to have sharply increased their purchases of these fruits. According to Fruit-Inform, in summer and autumn, Russia's banana import volumes increased by 30% year-on-year. A trend of the price growth was outlined only in early December. However, as of today, banana prices on Moscow wholesale markets are half as high as in 2010 with supply still prevailing over real demand.

The situation with banana sales in Ukraine is even more complicated. In addition to European trends, importers faced another increase in reference (indicative) prices for bananas that led to sharp reduction of traders' margin. Importers report that they are forced to operate at a loss, as the Ukrainian banana market is experiencing a serious crisis. As of early December, in contravention of hopes for the seasonal increase, banana prices keep on falling and already are 25% lower year-on-year.

We would remind you that more detailed information about Ukrainian and Russian fruit and vegetable markets is available for subscribers of Fruit-Inform Weekly service package.