Philippines banana industry faces US$200M revenue loss as ME conflict disrupts high-growth market
The Middle East accounted for 12% of the Philippines’ banana export value last year
PHILIPPINES – The Pilipino Banana Growers and Exporters Association has warned that escalating Middle East conflict could cost the country up to US$200 million in lost revenue, erasing years of hard-won market expansion.
The warning, delivered in a letter to President Bongbong Marcos, underscores the vulnerability of agricultural trade to geopolitical instability.
In a statement, Stephen Antig, executive director of PBGEA, described the timing as particularly painful. “We were quite optimistic about the prospects in the Middle East market. Our shipments had just started to increase and then the war broke out,” he said.
The Middle East accounted for 12% of the Philippines’ banana export value last year, with Iran emerging as a standout growth market. Banana exports to Iran reached 242,877 tonnes in 2025, a 47% increase from 2024, representing 8% of total fresh banana exports.
In value terms, Iran alone surged 81% to US$97.52 million, making it the country’s fourth-largest market for fresh bananas with an annual growth rate of 15% from 2020 to 2025.
For Middle Eastern food markets, supply disruptions from the Philippines create immediate sourcing challenges. Iranian importers, who have developed strong consumer preference for Philippine bananas due to superior quality, face potential shortages.
In addition, the wider Gulf region, where combined banana export value to GCC countries and Iraq reached nearly US$95.5 million last year, may also experience tightening supply as exporters reassess regional exposure.
Antig acknowledged the competitive pressure from India but emphasized quality differentiation. “Even if we cannot compete with India, we still have loyal customers that continue to buy Philippine bananas in Iran due to better quality,” he said.
Moreover, the crisis highlights several risk factors. Banana importers face potential price volatility as supply from the Philippines contracts. Diversification strategies become critical, yet alternative origins like India, Ecuador, and Cameroon offer varying quality and logistical profiles.
The conflict also underscores the need for trade credit insurance and flexible contracting that can accommodate sudden market shifts.
However, the Philippines banana industry had been actively diversifying its portfolio, with corporations establishing footholds in Iran and other Middle Eastern countries precisely to reduce reliance on traditional markets. That diversification strategy now faces an unforeseen geopolitical shock.
For regional stakeholders, it is evident that supply chain resilience requires not only multiple sourcing origins but also contingency planning for the routes and regions those goods must traverse.
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