What are the conditions in Chinese banana production areas at the beginning of this new year? When will the new harvest enter the market? How will the market develop? 2018 turned out to be a record year for most banana production areas in China and Southeast Asia. The banana price continued to rise in October and November, and in some areas the price broke through the old record of 7 yuan [1.04 USD].
Five factors in the banana market development this year
1. The surface area devoted to banana plantations in China rapidly expanded in a short period. The high banana price in 2018 encouraged many farmers to increase the number of young banana trees in production, which will have its effect on the production volume this year.
2. The surface area devoted to banana plantation in Southeast Asia also grows, but there is a limit to how much banana production areas can expand in 2019.
3. The supply periods of banana production areas overlap and each strives to be the first in the market, because as soon as bananas enter the market in large volumes, the price drops. This situation creates sales difficulties for those who enter the market late.
4. Cold weather in Nanning, Guangxi, in early 2018 forced farmers to replace many of the young banana trees. This in turn had a long-lasting effect on the price of bananas in Guangxi.
5. Imported bananas offer an alternative. Consumers have more disposable income and they pay more attention to product quality than price.