Banana prices on an upward curve

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Banana and pineapple prices are on the rise again, the world's oldest tropical fruit shipper Fyffes warned yesterday.

The company said that a combination of the strong dollar (the currency in which fruits are priced by growers), rising fuel costs and higher fruit prices due to poor weather mean it will have to pass on higher prices to its customers and ultimately to shoppers.

But despite this the group raised its target for full-year earnings by €3m (£2.3m) to between €28m and €23m.

In the first half (when it makes most of its money), the group's pre-tax profit jumped 30 per cent to €22.4m.

It added that trading conditions in continental Europe had been "broadly satisfactory during the summer months".

Prices traditionally fall during the summer as more locally produced fruit is consumed, but then rise steadily again in the winter months.

Fyffes said much of its operational improvement had come from shifting a higher proportion of its fruit from fully refrigerated ships to refrigerated containers on more general vessels.

The group added that it performed particularly strongly in its dominant banana division, but also saw an 8 per cent rise in pineapple shipments and strong growth in melons.