Philexport to look into closure of Iran banana market due to shipment problems

The Philippine Exporters Confederation is set to form a group that will look into the possible closure of the Iran banana market to Davao banana exporters due to the United States economic embargo on Iran.

“We are not aware that our banana exports are no longer being sent to Iran but we will surely look into this especially with the Mindanao Exporters Congress,” Philexport XI Chairperson Domingo Ang said during Club 888’s media forum held at the Marco Polo Davao Wednesday.

The Mindanao Development Authority reported that banana is the number two dollar earner of Mindanao next only to coconut, with a 14.94 percent share in the total Mindanao export. Mindanao’s banana exports increased by 33.85 percent, from $467.3 million in 2011 to $625.5 million in 2012.

Ang said the problem will definitely be discussed during the Mindanao Exporters Congress slated in the city on August 1 to 3, 2013. The Congress will focus on topics like Improving Exports to Increase Philippine Competitiveness as well as Strengthening the Enabling Environment for Mindanao’s Export Growth.

The Philippine Banana Growers and Exporters Association (PBGEA) earlier expressed its concern about the possible P4 billion losses that will be incurred by the region’s banana industry as shipping companies stopped all shipments to Iran this year, including the shipment of exported bananas from Region XI.

PBGEA executive director Stephen Antig said Mercury Steamship Agencies, Inc., an agent of the Pacific International Lines which ships bananas to Iran, has advised them about the suspension of its operations. A letter sent to its valued clients indicated the last acceptance of cargoes bound for Iran was last June 15, 2013. The Mercury officials said that they have suspended the shipment of cargoes to Iran as of June 16 this year.

Antig said the suspension of shipments to Iran was part of the commitment of the shipping companies to foreign trade regulations in view of the economic sanctions imposed by the US against Iran which happens to account for 50 percent of the banana market in the Middle East.

“We have had difficulty in exporting bananas to Iran a long time ago but some exporters have found a way to export bananas through the long way although that is more expensive,” banana industry player and Cacao Industry Development Association of Mindanao (CIDAM) President Ireneo Dalayon said.

Another option, according to Antig, is the APL or the American Presidential Line which is willing to load bananas and ship them to Iran bound for Iran if the exporter has a license from the US Treasury.

Antig said he has already written the concerned government agencies including the Department of Agriculture and the Department of Trade and Industry and is waiting for their response.

Coconut still top priority over palm

The Mindanao Development Authority reiterated that coconut is still a top priority for the government despite the growing popularity of palm oil.

“The production of palm oil is only being encouraged and promoted in idle lands and in no way should palm compete with the existing coconut plantations,” Mindanao Development Authority’s Romeo Montenegro said at a press conference held at the Marco Polo Hotel.

He said coconut copra and palm kernel remains the top dollar earner of Mindanao with a 21.26 percent share in the total exports of Mindanao as of 2012. However, he said that coconut exports decreased by 19.48 percent, from $1.1055 billion in 2011 to $.89 billion in 2012.

The MINDA report shows that coconut or copra got the largest share of Mindanao’s exports to the United States amounting to $359 million or 43.2 percent of the total exports to the US. Coconut copra was also Mindanao largest export to the Netherlands amounting to $303.68 or a share of 61 percent of the total exports to the said country.

“Despite the challenges faced by the coconut industry demand continues to increase but there seems to be a reduction of supply,” he said. Montenegro said this is why the government is encouraging the planting and production of more coconut and its byproducts.

He mentioned the increasing demand of Franklin Baker which enjoys robust demand for its coconut water in the export market. Farmers are also encouraged to intercrop coconuts with cocoa and coffee as these are also in demand top commodities.