Large retailers began to look for a replacement for banana supplies from Ecuador

Although Rosselkhoznadzor has dropped claims against banana producers from Ecuador, suppliers of these products to Russia, including mainly large retailers, are looking for alternative channels. Now importers are worried about the unstable political situation in Ecuador, caused by riots by local criminal gangs. The chains began to supply bananas from India, Costa Rica, Colombia, Brazil and other countries. However, it will take several years to change existing supply chains and stop working with Ecuador, which for a long time was practically the only supplier of this fruit in the Russian Federation, which threatens to increase prices, experts warn.

Large retailers have begun to look for a replacement for banana supplies from Ecuador, the chains told Kommersant. Thus, X5 Group (Pyaterochka and Perekrestok stores) is increasing imports from India, Costa Rica, Colombia, Brazil, Turkey, Egypt and other countries. X5 received the first test batch of 20 tons of bananas from India on March 14, delivery from Costa Rica is expected. Imports from Colombia, Brazil, Turkey, Egypt are in the future, there are offers from Vietnam, China and Cameroon, X5 added.

In 2023, X5 took first place in the import of bananas in Russia, increasing the import of this product year-on-year by 8%, to 386 thousand tons, the company says. All deliveries were made from Ecuador. In 2023, according to data from market participants available to Kommersant, banana imports to Russia increased year-on-year by 28.7 thousand tons, to 1.38 million tons. According to Rusprodsoyuz, more than 95% of supplies come from Ecuador. However, recently imports from this country have been in jeopardy.

In February, the head of Rosselkhoznadzor, Sergei Dankvert, announced the suspension of certification of bananas from five Ecuadorian suppliers due to humpback flies detected in the fruits. This was preceded by a statement by Ecuadorian President Daniel Noboa about plans to transfer Russian-made weapons to the United States, which could then be sent to Ukraine.

After Ecuador reversed the decision to transfer weapons, Rosselkhoznadzor allowed deliveries in mid-February. However, this did not reduce the concerns of banana importers, since at the beginning of 2024, the President of Ecuador declared a state of emergency and a regime of “internal armed conflict” due to the rebellion of criminal groups in the country after the escape from prison of the leader of the Los Choneros group. President of the Association of Importers of Fruit and Vegetable Products Irina Norina then told RBC that counterparties were warning about possible interruptions in the supply of bananas, including due to unstable logistics.

The transport company FESCO, which delivered the first batch of bananas from India on March 14 under the order of X5 Group, says that it is discussing with other retailers the delivery of such products from India and Vietnam instead of Ecuador.

Magnit told Kommersant that they are considering alternative supplies of bananas and are already testing the import of these products from several countries, including India and Vietnam. Vkusville says that it is studying the issue of expanding the area for importing bananas, including based on the price-quality ratio. Lenta, Auchan and Metro did not answer Kommersant.

Deputy Chairman of the Board of Rusprodsoyuz Dmitry Leonov agrees that the current unstable political situation in Ecuador may encourage importers to change the geography of banana supplies. Senior analyst at Gazprombank Marat Ibragimov notes that bananas are one of the main traffic generators in grocery stores and “a mandatory attribute of the value proposition for chains.” Banana sales grew 19.6% from October 2022 to October 2023, according to NielsenIQ. This is the third result among fruits after pears and avocados, sales of which in monetary terms increased by 26.1% and 26.7%.

General Director of FruitNews Information Agency Irina Koziy, however, warns that the import of bananas from India is complicated by long transportation from growing sites to Russian ports with a relatively short shelf life of the country’s traditional varieties. In general, she notes, any significant change in the geography of supplies may take several years and will be accompanied by an increase in retail prices. According to Rosstat, average consumer prices for bananas in Russia from January 2023 to January 2024 have already increased by 46%, to 155.27 rubles. per kilogram.

Vladimir Komarov