In early September, the average price of Grade A bananas reached 4.10 yuan per kilo in production areas across China, a record high since the start of the year. The recent high banana prices are mainly the result of the following three factors:
First, prices were driven up by higher priced imported bananas. Affected by lower production in the Philippines, China's banana imports in August were estimated at only 130,000 tons, showing a decline from July. This decline coupled with the traditional off-season taking place in July and August has driven up importers’ expectations for the market price. High prices lowered the enthusiasm of wholesalers in making orders and some turned to locally grown products, driving the price up.
Secondly, the current supply season of production areas in Hainan is nearing an end, while production areas in Guangxi just began shipping, so the supply is limited and the overall supply is slightly tight.
Thirdly, affected by the holidays, the Mid-Autumn Festival and National Day, local distributors increased purchase and stocking efforts, further boosting banana prices in the place of origin.
With the arrival of the peak supply season in September, the trend of rising banana prices is expected to be completely turned around. In terms of imports, the Philippines, an important provider of imported bananas, has now recovered from lower production brought about by droughts.
Source: iFreshFair