ONCE the backbone of the Philippines’ banana exports, Mindanao’s plantations are grappling with rising challenges as tariffs and shifting global markets erode the sector’s competitiveness. Even major estates, such as the Tagum Agricultural Development Company, Inc. (Tadeco), face pressures from foreign competitors and rising costs.
Tariffs and market shifts
Rene Dalayon, CEO of the Federation of Cooperatives in Mindanao (Fedco), said Philippine banana producers are losing ground in key export markets.
“Sa banana industry, napildi nata sa Vietnam sa market sa China. Kulang na, gamay nalang atoang saging. Ginapatay ta sa tarrif. Ang atoang neighboring countries zero sa tarrif (In the banana industry, Vietnam has overtaken us in China. Our supply is limited, and tariffs are killing us. Neighboring countries enjoy zero tariffs),” Dalayon said during a year-end business forum in Hukad, Abreeza Ayala Malls, December 18, 2025.
The export data supports his view. From 2024 to 2025, Vietnam exported roughly 625,000 metric tons of bananas to China, surpassing the Philippines’ 463,000 metric tons. Over the past decade, Vietnam’s share of China’s imports increased from 1 percent to nearly 37 percent, while the Philippines’ share declined from 70 percent in 2017 to 27 percent in 2024. Vietnamese bananas are also expanding into Japan, South Korea, Asean countries, the Middle East, and the U.S., aided by strategic marketing, quality improvements, and stronger distribution networks.
Mindanao remains the heart of production
Despite these challenges, Mindanao still dominates Philippine banana production. In 2024, bananas accounted for 94.8 percent of the Davao Region’s fruit output, totaling 3.19 million metric tons. Nationwide, banana plantations cover an estimated 443,000–451,000 hectares, with Mindanao accounting for roughly 258,500 hectares in the Davao Region, Northern Mindanao, and Soccsksargen.
Bananas grown in Mindanao are mostly Cavendish varieties for export, providing livelihoods for nearly a million people and sustaining regional economies.
Tadeco in Panabo City, Davao del Norte, operates one of the world’s largest contiguous Cavendish plantations, covering 6,300–6,900 hectares. The company exports millions of boxes annually to Japan, South Korea, China, and the Middle East. It also invests in local communities through jobs, schools, roads, and healthcare programs.
Yet Tadeco faces threats common to the industry: Panama disease, rising labor costs, security issues, and export tariffs. Japan imposes duties up to 18 percent, giving competitors like Vietnam a price advantage under trade agreements with lower or zero tariffs.
Vietnam also gains from its strategic location and efficient logistics, especially its proximity to China. Overland and rail connections lower transportation costs and speed delivery, while large-scale plantations ensure a steady supply. These advantages, along with favorable tariffs, helped Vietnam’s banana exports to China grow nearly 24 percent in 2024, even as Philippine exports dropped more than 30 percent.
Industry challenges and outlook
Industry leaders note that tariffs are not the only hurdle. Domestic issues—disease, rising costs, labor shortages, and extreme weather—also affect production. William Castro, president of the Mindanao Banana Farmers and Exporters Association, said Cavendish production in Mindanao has dropped nearly 50 percent in recent years.
“Events like Bancon are vital to help growers sustain farms and reclaim our place in the global market,” Castro said. Smaller farms, with limited capital and market access, remain especially vulnerable.
Economic significance
Banana exports remain vital to Mindanao’s economy, generating US$1.19 billion in 2023—nearly half of the Davao Region’s total exports. In 2024, the DTI reported P235 million in new investments, creating about 1,000 jobs and expanding export capacity.
Smaller producers, however, face rising costs, disease, and tariffs, threatening the livelihoods of nearly one million people dependent on banana farming. While large estates like Tadeco remain strong, Vietnam’s rapid growth in China and Japan, aided by lower tariffs and modern plantations, heightens competition.
Dalayon said tariffs are a key factor, but sustaining the industry will require policy support, innovation, and structural reforms.