China Banana Prices Rise in Wake of Typhoon Mangkhut Destruction

Typhoon Mangkhut last month caused heavy losses to key banana producing areas in China’s Guangdong province, further intensifying a trend of rising prices on the domestic China market, according to interviews with farmers and data analysis.

Mangkhut made landfall on the Chinese mainland on September 16 and passed over Guangdong’s Taishan prefecture, which lies approximately 130km to the west of Hong Kong. Taishan is an important banana producing region. Local officials estimate the prefecture contains 2,600 to 3,300ha of land under plantation for bananas, spread across several different counties and including a number of different banana varieties and cultivars. They said as much as 70% of the prefecture’s crop was destroyed by Mangkhut.

Guangdong province as a whole contains some 20,000 to 33,000 hectares of land devoted to banana plantation. Aside from Taishan prefecture, Mangkhut also caused significant losses for banana farmers in the prefectures of Jiangmen, Yangjiang, Zhaoqing and Nansha. Overall, as much as 6,600ha of banana plantation was heavily disrupted by the typhoon. Neighboring Guangxi province, another important production region, was largely spared, and suffered only minor losses.

Prior to the typhoon, domestic banana prices had already been rising in China through the first three quarters of the year, after relatively weak prices in 2017. A harvest was underway in Guangdong prior to Mangkhut’s arrival, with an average field price of 3.6 RMB ($0.52) per kilo being paid to farmers in Guangdong. Despite a spike in supply as farmers rushed to harvest what they could before the storm hit, prices continued to rise, hitting 4 RMB ($0.58) per kilo in the wake of the storm.

National average wholesale prices for bananas have risen from 4.2 RMB ($0.61) per kilo in June to 5.2 RMB ($0.76) per kilo in late September. Produce Report analyzed data from domestic banana price indices. Our analysis indicated that as of the beginning of this month, rising prices at the producer level had not fully worked their way through the transaction chain. Therefore, in the short term, it can be expected that wholesale and retail banana prices will continue on an upward trend.

Image: Baidu Images