Banana exporters eye Russia

THE Pilipino Banana Growers and Exporters Association (PBGEA) is looking into the possibility of exporting bananas from Davao Region to Russia in an effort to identify new export markets.

In an interview with PBGEA president Stephen Antig, he said the biggest exporter of bananas to Russia is Ecuador and some other countries in South America.

“We requested the Department of Agriculture (DA) and the Department of Trade and Industry (DTI) to look into the possibility of organizing an outbound business mission to an entry-point in Russia. So we can meet with the importers of Russia and discuss the possibility of increasing our export to that country,” said Antig.

He said Japan is already a mature and growing market. According to the data provided by the Philippine Statistics Authority, a total of US$278.17 million was accumulated from banana exports alone as of the third quarter of last year, with Japan remaining to be on top of the export destinations.

Antig said Korea is also a growing market although it is not that big. He mentioned the high potential the Chinese market has, however they are also starting to buy from Ecuador as well.

“I think that’s the strategy of China. In case we experience another El Niño, they won’t have problems with supplies because they have identified other sources,” said Antig.

He said this strategic move of China will greatly affect small-medium banana growers as they export almost 90 percent of their productions to China.

“Overtime, we saw that the export to China has been growing but it’s not growing as fast as we would want it to be. We discovered that some of the bananas that we have been selling to China are actually being exported or sold to Russia also. So I asked, why not us? Why don’t we directly export to Russia?” said Antig.

He said this made them realize that as per the quality of Davao Region bananas, it can compete with the other foreign banana growers.

However, one of the reasons Antig sees why the banana growers experience difficulty keeping up with its foreign competitions is their government support.

“They [foreign banana exporters] have subsidies from their government. Their government is also very aggressive in negotiating for the reduction or elimination of tariff to the countries where they are exporting their bananas,” said Antig.

He said in the case of Philippines, even when

Japan remains to be on top of the export destinations, tariff fee for that country is still expensive with different amounts for winter and summer. During winters, around 18 percent of the export cost is added for tariff and eight percent during the summers. He compared this to other banana producing countries with zero tariffs to any countries.

He mentioned that currently the countries that Philippines export to with zero tariffs are only New Zealand and China. Tariff for South Korea export falls at 13 percent, Indonesia at 35 percent, and the countries in the Middle East at 26 percent. “So if we can get to eliminate this tariff by being more aggressive in our negotiation, volume of export for these countries will possibly increase and we will be able to compete with other producers,” said Antig.