Banana demand exceeds supply
Banana demand exceeds supply
The top-selling fruit in U.S. produce departments is now in shorter supply than usual as a result of storms that tore through banana-producing regions last fall.
Michael Mitchell, director of corporate communications for Chiquita Brands International Inc. in Cincinnati, told The Produce News Feb. 14 that this situation first developed with Hurricane Stan in Guatemala, followed by Tropical Storm Gamma in Honduras in the fourth quarter of 2005. Supplies have remained low in the first quarter of 2006 because of unusually cool weather in other countries that can serve as alternative banana sources.
Mr. Mitchell said that the supply situation "is not getting worse [but] is certainly something we are taking very seriously, and we are working with customers when there are shortages to meet their demands as much as we can. Demand is exceeding supply and it has since the fourth quarter." Reduced banana production "is relatively widespread," Mr. Mitchell said. "Ecuador is one of the places. Costa Rica, the northern coast of Guatemala and Colombia have all had unseasonably cool temperatures and rain, which has resulted in lower-than-usual production."
Mr. Mitchell reiterated, "Certainly our priority is to provide our customers with the Chiquita bananas that they want. We are working as cooperatively as we can to meet their volume needs."
Banana and produce distributor Stanley Greenspan of United Fruit & Produce in St. Louis said Feb. 9 that the "banana market has been tight. For five or six weeks, it has been in an upward spiral."
Mr. Greenspan predicted that the tight supplies will last "through March and it will be April before they get another crop down there." He joked that Hurricane Stan was not only named for him, but caused more damage than anyone realized at the time last fall.
Mr. Greenspan said that last July, banana companies "couldn't give them away."
In mid-February, United Fruit & Produce was selling bananas to street jobbers for $22-23 a case. "We call for three loads and get one. Some people don't get any." He was keeping regular prices for United's retail customers, who were also keeping their retail prices in the 49- to 69-cent range.
Mr. Greenspan has purchased organic bananas and sold them in place of conventional bananas. "We were looking for any kind of banana we could find, as long as they were good quality. We never had loads of organics" before this shortage. "Like anything else, you take anything to fill the spot."