China: Market value for bananas keeps going up

Since mid-February, the market value of bananas has been rising. In specific regions it has even dou…

Since mid-February, the market value of bananas has been rising. In specific regions it has even doubled. During the past half year, the price of bananas produced in manufacturing locations has been rather low, so, based on the price in the previous period, the consumers have a certain price level in mind. The price for manufactured bananas has risen by more than 1 RMB a kilogram within a single month. After arriving in the end market, the price will probably go up by another 1 RMB. Customers are likely to find these prices contradictory. Under these circumstances, customers have started to buy less bananas, and the sales volume on the wholesale market has been decreasing for the past two days.

Bananas from Guangxi province will only enter the market in large volumes during August. Currently, the majority of the bananas in the market are produced in Yunnan, Hainan and Guangdong. The bananas from Hainan will arrive in April but most are destined for local markets. The banana plantation in Guangdong is spread out over an area of approximately 27 hectares (400 000 mu) so the supply is rather limited. Suppliers from Yunnan, on the other hand, have an area of 113 hectares (1 700 000 mu). However, currently only 30% of the bananas in Xishuangbanna prefecture in Yunnan are left in stock and this is insufficient to even provide up to 20% of the demand on that side of the river. It is clear the supply on the market these days is lacking.