Export complications for Ecuador's banana industry - FreshFruitPortal.com

Export complications for Ecuador's banana industry

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Export complications for Ecuador's banana industry

Ecuador's National Customs Service (SENAE) recently made modifications to its export logistics, specifically for its container cargo system.banana_tree ffp

The changes have made exporters evaluate the upward effect of capacity delays on costs. Eduardo Ledesma of the Banana Exporters Association explained the details of the new system.

"What has happened is that customs has established a new mechanism for containers. They are applying certain rules that complicate processing upon opening customs permits," Ledesma said.

"Before, customs opened the first car that came and now they open the last one. The downside is that if the last car doesn't go in, all of them can be left out unless they open another permit."

Additional complication comes from time limits for the arrival of containers to the port of Guayaquil.

"Another problem is that the port of Guayaquil, which is administered by the business Contecon, is placing time limits for car arrival. This can complicate processing and shipments of fruit abroad," he said.

On the other hand, low temperatures have affected banana processing and helped lower exports to date by 7.58% compared to 2012.

"There is no major damage to plantations but there has been a reduction in exports. There has not been a reaction regarding price on the international market. It has remained stable," Ledesma said.

On the positive end of the spectrum, the country's minister of agriculture has eliminated inspection tariffs for containers and has expressed possible elimination of such tariffs for bananas, which corresponds to 0.7% FOB value of each box of bananas exported.

"This tax, which exporters used to pay, will now be taken on by the state. The minister has also offered to eliminate a tax paid by exporters that represented about 4 cents a box. Elimination would come with the objective of making Ecuadorian bananas more competitive," he said.

"The elimination of tariffs would help exporters a lot. Not paying these tariffs would reduce cost a lot. Before, exporters would pay US$80 for every 1,000 boxes inspected and now they will not pay anything because the cost will go to the state."

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