Banana exports- a victim of Ukraine war
March 22, 2022

Banana exports- a victim of Ukraine war

MUCH OF the media discussion on the war in Ukraine focuses on the war itself and propaganda from both sides. However, the negative effects of the war are being felt far beyond the actual countries involved.

Already the war is not only causing chaos in the international financial markets and affecting international trade. Prices of many basic commodities, starting with oil and its multiplier effect, are skyrocketing resulting in an increase in poverty and hunger. Places far removed from Russia or Ukraine are feeling the pinch and things are getting worse.

Take the South American country of Ecuador for instance, the world’s largest exporter of bananas. In spite of that country being more than 8600 miles away from Russia, the big Russian market accounts for more than 20% of Ecuador’s banana exports and Ukraine on the other side of the war is also a big importer. Russia’s total banana imports in 2020 amounted to US$ 1.1 billion whilst Ukraine’s was US$ 177 million.

But the war has wreaked havoc with this vital trade. The complete closure of Ukraine’s ports, the disruption of trade routes to Russia, and the devaluation of the Russian ruble have all hit Ecuador and its vital banana industry hard. Two weeks ago, there were already more than one million boxes of unshipped bananas piling up and naturally the situation has worsened.

The Ecuadorean Federation of Exporters said that it is not just bananas which are affected. Exports of other primary commodities especially cut flowers and shrimp have also been affected. It explains that at this time of year Ecuadorean exports concentrate on those markets. In addition, because there are different phytosanitary requirements for Russia and Ukraine to those for other Ecuadorean export markets such as the USA, the European Union, South Korea and Japan, it is not possible to reroute the shipments. Shipping space is also a problem.

Especially hard hit are the country’s 2500 medium and small banana growers who in turn employ about 25,000 workers in the industry. Already in a hand-to-mouth existence mode, poverty and hunger are staring them in the face.

Truly, while nobody wins a war, millions lose because of it.