Mindanao banana exporters see tighter competition next year

DAVAO CITY (MindaNews / 22 Dec) – Barely recovering from the recent drought that hit the agriculture sector this year, large banana exporters in Mindanao will be faced with yet another problem in 2017 amid the looming stiffer competitions with other banana-growing nations now entering the Philippines’s traditional market like Japan.

Stephen Antig, executive director of the Pilipino Banana Growers and Exporters Association (PBGEA), said in an interview that competition will be a major issue that industry players must address next year.

He said that their competitors like countries in Latin and Central America and neighboring nations in Southeast Asia have entered the Philippines’s international markets when it suffered from a low production output due to the El Niño in 2016.

“We’re hoping that the increase in production will continue until next year but the problem is more and more countries are starting to produce and export bananas to the same market,” Antig said.

He said that one of the solutions that would be viable is for the government to negotiate for the elimination of the tariffs with the governments of their international markets “because that’s the only way we can survive and remain competitive.”

Antig said that if the Philippine government would fail to heed their calls, they will be left behind in the competition.

He said that their global competitors are able to lower the cost of their bananas because their governments are supportive.

Records from PBGEA showed that Japan is the top buyer of Philippine Cavendish bananas, followed by Gulf countries (United Arab Emirates, Saudi Arabia, Oman, Kuwait, Qatar and Bahrain), China, South Korea, Iran, Hong Kong, Singapore, Russia, New Zealand, and the United States.

It also showed that Ecuador was the largest exporter of bananas in the world with $2.7 billion worth of export in 2015, followed by Costa Rica with $834 million, Guatemala with $771 million, Colombia with $757 million, Philippines with $440 million, and USA with $427 million.

Antig said that Myanmar, for instance, is attracting foreign banana growers to locate and expand there by offering incentives.

“In the Philippines, they cannot do that. That’s the reason why some investors are shying away from coming to the Philippines,” he said. He added that aside from the “unfriendly or not very friendly investment policies,” investors are also worried “because our laws are changing all the time, especially when the administration changes and members of the cabinet have also changed.”

Agriculture Secretary Manny Piñol announced on October 27 that he struck a deal with a Japanese company, Farmind Corp., who promised to buy 20 million boxes a year of Cavendish bananas from the Philippines.

In a statement, he said the deal will earn the country P5 billion a year and generate 14,000 jobs in Mindanao.

“The signing of the agreement will mark the start of the development of about 7,000 hectares of banana farms which the Japanese company, Farmind Corp., would like to be located in former conflict areas in the Southern Philippines,” Piñol said.

He said that the Farmind Corp. project will also support the former rebel returnees and beneficiaries of agrarian reform program get livelihood opportunities.

Piñol said that the project was referred to him by Davao del Norte Rep. and Speaker Pantaleon Alvarez immediately after he assumed as agriculture chief two months ago.

He said Alvarez relayed to him the intention of Farmind president Tatstuo Horiuchi to “provide livelihood to agrarian reform beneficiaries, as well as former rebels, to support the President’s peace efforts.” (Antonio L. Colina IV / MindaNews)