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Disease Is Ravaging the $25 Billion Banana Industry Bloomberg

Yahoo (from Blomberg)

Alan Crawford and Stephan Kueffner Bloomberg

(Bloomberg) -- In the banana plantations of the tropical lowlands of Ecuador, workers are being issued with protective clothing and disinfectant is provided for their tools.

The safety precautions implemented in the farms that stretch between the Andes and the Pacific coast are not simply to guard against the coronavirus. They’re a foretaste of what will be required to shield the valuable crop against another disease, one that poses an existential threat to a $25 billion industry.

Bananas have a claim to be the modern world’s first globalized product and are still the most exported fruit on the planet. Yet the trade that began some 130 years ago is now a potent symbol of the underlying fragility of globalization. How it adapts and responds may suggest a path toward rebuilding international consensus in the post-pandemic era.

The fiber and vitamin-rich fruit is such an everyday item that it’s easy to overlook the environmental, social and political issues inherent in where they come from, and the economic reality of what it takes to get them to supermarket shelves. Grown in the south and shipped to markets in the north, much of the supply chain put in place in the 19th century is still in use today.

Just as coronavirus ravages the world in the absence of a vaccine, so the banana disease fusarium wilt is marching inexorably around the globe, leaving a trail of scorched plantations in its wake. A strain known as Tropical Race 4 (TR4) first identified in Taiwan some two decades ago has spread throughout Asia to the Middle East and Africa before its arrival in the banana heartlands of Latin America late last year, when it was detected in Colombia.

It is considered among the most destructive of all plant diseases, according to the Food and Agriculture Organization of the United Nations, or FAO. “Biosecurity measures” including “on-farm quarantine” are recommended to mitigate its spread, but as with Covid-19, there is no treatment. Once the soil is contaminated, there’s no hope of elimination; the only recourse is to abandon the land and move elsewhere.

The industry was beginning to adapt to the fusarium threat, and the same biosecurity measures intended to protect against it are being used in the coronavirus response, said Juan José Pons, coordinator of the Banana Cluster of Ecuador that includes the industry’s guilds and associations.

Ecuador’s 8,000 banana producers will all need to “become more productive, more efficient, with better biosecurity controls that can guarantee future sustainability,” he said.

In reality, the banana trade was at a crossroads before TR4 arrived in Latin America, which together with the Caribbean accounts for more than three-quarters of world banana exports.

Add in Covid-19, and “the industry is really at a turning point,” said Pascal Liu, a senior economist at the FAO in Rome and coordinator of the World Banana Forum, a stakeholder group for everyone from growers to retailers, NGOs and research institutes.

Climate change, environmental degradation, the power of supermarkets to dictate prices and growing pressure to improve the lot of workers, the banana industry has been under siege on multiple fronts for some time now. 

As the world’s biggest exporter, Ecuador is at its epicenter. The country on Latin America’s Pacific coast accounted for around one third of the 20 million tons of bananas shipped globally last year. The fruit is worth more to Ecuador than the oil industry after the collapse in crude prices—some $3.2 billion last year, the equivalent of 3% of the economy. 

It’s also been home to one of the worst outbreaks of coronavirus in Latin America, at one point with bodies lying in the streets of the port of Guayaquil, Ecuador’s largest city.

The epidemic caused logistical difficulties at the port, with staff shortages and a lack of temperature controlled containers resulting in temporary interruptions in shipments. There was little or no disruption to work on the plantations, however.

Indeed, the banana looks like one of the winners of the crisis, with its reputation as a healthy snack helping to boost global demand during lockdowns. Anecdotally, sales are up in the European Union, the world’s largest importer.

But that hasn’t translated into a boon for the banana growers or importers, whose costs have risen due to the logistical disruptions and the implementation of safety measures. Seasonal factors have also weighed in, driving down spot prices for a 40-pound (18 kilogram) box to as little as $2 or $3.


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