Ecuador’s government has announced that it will buy bananas from small producers in the country to help ease the “critical situation” in the Ecuadorian banana sector following the collapse in prices in Russia and China.
In an official statement, Ecuadorian president Rafael Correa said the government would purchase part of the total volume of bananas produced in the country during January to alleviate the slump in prices in the global market.
Faced with the emergency, Mr Correa said that Ecuador’s government “had to act”, adding that some of the US$6m that had been allocated to combat an agricultural crisis in the western region of Manabí would be diverted to buy bananas.
Ecuadorian agriculture subsecretary Rafael Guerrero Burgos told the country’s El Telegrafo that the authorities expected to buy some 3m bunches of bananas from small producers during the first three weeks of 2010. Growers are reportedly being paid US$2 per bunch, according to the publication.
The Ecuadorian government’s action follows the near collapse in banana prices in markets such as Russia over recent weeks.
According to a report in Diario La Opinión, Russian company Bonanza, which exports bananas from Ecuador to the Russian market, has suspended its sourcing in Ecuador from week 52 of December 2009 to week 2 of 2010.
The company told the publication that the decision had been taken as a result of other exporters reducing the price of sale.
“These companies only appear in the market when the situation favours them, paying below the official price and not signing contracts with producers,” Bonanza said.
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