iTi Tropicals would like to comment on below article. This is related to fresh bananas but when this quota was put in effect in 1993 it had profound ramifications on the banana puree business. Prices dropped from $0.38 to $0.25 per lb over the years as a direct result of this quota system. This was caused by the fact that the European quota system for fresh bananas resulted in a glut of fresh bananas. This in turn resulted in more banana puree processing factories being build. Hence the low prices.
Will this new settlement result in higher prices for banana puree? For the sake of the processors and their workers we certainly hope so, as the current pricing is not sustainable to invest in upgrading factories , upgrading working conditions and staying completely up to date with all kinds of new requirements that were requested over the years by our customers: kosher certification, HACCP, AIB audits, third party audits,. Social audits etc.
Banana puree has always been a low priced commodity and at 22 brix is a great value. It adds viscosity, texture, and mouth-feel to drinks.
We are pleased that the EEC took the necessary steps to finally cut the import tariffs on fresh banana and hope that this will be another step in free trade for all.
Will it result in higher prices for banana puree? Time will tell but one thing is for sure. These low prices we have experienced in the last 15 years are not sustainable for a healthy work environment and a healthy business.
Gert van Manen- President iTi Tropicals, Inc
Agreement to Cut Tariffs Will Benefit U.S. Fruit Companies
Exerpted from WSJ.com, December 16, 2009
By JOHN W. MILLER
BRUSSELS -- The European Union ended one of the world's longest-running trade battles Tuesday as it agreed to cut import tariffs on bananas from Latin America grown by U.S. corporations like Dole Food Co., Fresh Del Monte Produce Inc. and Chiquita Brands International Inc.
The settlement, which national lawmakers are expected to ratify within four months, trade officials say, means less-expensive bananas for Europeans, more profit for U.S. fruit companies and lower revenue for some former EU colonies. It ends a 16-year-old trade dispute over access to the EU's $6.7 billion banana market, the world's largest.
Since 1993, when it set up its tariff-free zone, the EU has offered the best import rates to 12 former colonies, places like Cameroon, Ivory Coast and Belize.
The deal upset governments in countries such as Colombia, Costa Rica and Guatemala, where U.S. companies run industrial fruit plantations.
Five Latin American countries, backed by the U.S., filed their first formal trade complaint at the World Trade Organization in 1993. As the dispute escalated, other countries joined the battle against the EU tariffs.
Since then, the EU has offered tariff cuts several times. Each time, the Latin American nations found them insufficient and filed another WTO complaint. In 1999, the WTO authorized the U.S. to impose $191.4 million of trade sanctions on the EU. The last WTO ruling, again upholding the complaint, was issued in early 2008. Trade ministers tried, and failed, to secure a deal as part of the Doha Round of trade talks.
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