Sunday, April 17, 2011

Banana Trade

Bananas and plantains constitute a major staple food crop for millions of people in developing countries. In most tropical countries, green (unripe) bananas used for cooking represent the main cultivars. Bananas are cooked in ways that are similar to potatoes. Both can be fried, boiled, baked, or chipped and have similar taste and texture when served. One banana provides about the same calories as one potato.

In 2009, India led the world in banana production, representing approximately 28% of the worldwide crop, mostly for domestic consumption. The six leading exporting countries (Table, right) together accounted for about two-thirds of exports, each contributing more than 6 million tons, according to Food and Agriculture Organization statistics.

Most producers are small-scale farmers either for home consumption or local markets. Because bananas and plantains produce fruit year-round, they provide an extremely valuable food source during the hunger season (when the food from one annual/semi-annual harvest has been consumed, and the next is still to come). Bananas and plantains are therefore critical to global food security.

Bananas are among the most widely consumed foods in the world. Most banana farmers receive a low price for their produce as grocery companies pay discounted prices for buying in enormous quantity. Price competition among grocers has reduced their margins, leading to lower prices for growers. Chiquita, Del Monte, Dole, and Fyffes grow their own bananas in Ecuador, Colombia, Costa Rica, Guatemala, and Honduras. Banana plantations are capital intensive and demand significant expertise. The majority of independent growers are large and wealthy landowners in these countries. Producers have attempted to raise prices via marketing them as "fair trade" or Rainforest Alliance-certified in some countries.

The banana has an extensive trade history beginning with the founding of the United Fruit Company (now Chiquita) at the end of the 19th century. For much of the 20th century, bananas and coffee dominated the export economies of Central America. In the 1930s, bananas and coffee made up as much as 75% of the region's exports. As late as 1960, the two crops accounted for 67% of the exports from the region. Though the two were grown in similar regions, they tended not to be distributed together. The United Fruit Company based its business almost entirely on the banana trade, because the coffee trade proved too difficult to control. The term "banana republic" has been applied to most countries in Central America, but from a strict economic perspective only Costa Rica, Honduras, and Panama had economies dominated by the banana trade.

The European Union has traditionally imported many of their bananas from former European Caribbean colonies, paying guaranteed prices above global market rates. As of 2005, these arrangements were in the process of being withdrawn under pressure from other major trading powers, principally the United States. The withdrawal of these indirect subsidies to Caribbean producers is expected to favour the banana producers of Central America, in which American companies have an economic interest.

The United States produces few bananas. A mere 14,000 tonnes (14,000 LT; 15,000 ST) were grown in Hawaii in 2001. Bananas were once grown in Florida and southern California.

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