Indian banana exports may be hit by higher prices

As farmgate prices of bananas have almost doubled over the past year, their exports have slowed down in volumes, though their value has increased on higher realisations.

Banana exports from India, the world’s largest producer of the fruit, had crossed the ₹1,000-crore mark during 2021-22 touching an all time high of ₹1,188 crore.

“The farmgate prices of bananas have been 100 per cent higher over the historical averages. As against ₹14-15 per kg a year ago, farmgate prices of bananas are ruling higher at ₹27-28 per kg, slowing down shipments in the ongoing peak season,” said Pankaj Khandelwal, Chairman and Managing Director, INI Farms, a large exporting firm that was acquired by agtech start-up AgroStar last year.

Khandelwal sees volumes declining by up to 30 per cent this year due to higher prices. In 2021-22, banana exports touched 3.78 lakh tonnes — an increase of 62 per cent over 2.33 lakh tonnes in 2020-21. In dollar terms, shipments during 2021-22 touched $159.09 million — a 58 per cent increase over $100.69 million the previous year.

The higher price this year is due to a reduction in supplies on account of farmers shifting to other lucrative crops. “Last year because of high freight costs, farmers didn’t get better realisations, and as a result, the planting was less this year leading to reduced volumes and ultimately higher prices,” Khandelwal said.

Trade feedback

Banana prices are up across the key producing regions of Maharashtra, Andhra Pradesh, Tamil Nadu, and Karnataka among others, resulting in higher consumer prices in the domestic market.

As per APEDA’s export data, the banana shipments for the April-December period of 2022-23 declined by about six per cent, while there has been an increase of 10.65 per cent in value over the previous year.

“As per the trade feedback, the decline in exports is due to the high price at the farm gate. The cost of the produce has increased by 100 per cent. Earlier, the cost was ₹13-14 per kg, which has gone up to ₹28-30 per kg now,” said APEDA Chairman M Angamuthu.

“There is a demand for Indian bananas. APEDA is pushing and promoting at least over 10 varieties of GI bananas from the country, for which there is an increasing demand. In-store exclusive promotion programmes were organised in over 20 countries,” Angamuthu said.

West Asia is the largest buyer of Indian bananas with Iran being the largest importer, followed by Iraq and UAE among others. Banana exports during the April-December period of the 2022-23 fiscal stood higher at ₹873 crore over ₹789 crore in the same period a year ago.

Varietal shift

Varieties such as the Cavendish or the Robusta and Nendran account for a major chunk of the banana exports from India. “The robusta banana production is down in the main production centres of Kambam, Theni and Tiruchirapalli regions, resulting in higher prices. Prices have risen by ₹10-15 per kg in both wholesale and retail markets” said PV Hamza, past President of All Kerala Fruit Merchants Association. However, Nendran banana prices have come down in the State, thanks to its increased availability in the market. The Gulf markets procure a major portion of this particular variety from Kerala, he said.

Sources at the National Research Centre for Banana in Tiruchirapalli said a section of farmers around Theni has shifted from the Cavendish variety to growing more of the Nendran variety. Also, the demand for fruit has gone up with increase in consumption especially post-Covid, they said.

COMMENT NOW