The banana production seasons are nearly over in Hainan and Guangdong. Most of the bananas on the Chinese market come from production areas in Guangdong or are imported from Southeast Asia. Temperatures in south China have been relatively warm at the beginning of autumn, and these weather conditions are not favorable for banana sales. Mr. Xia Zuxiang, board member at Shanghai Sophia International Trade Co., Ltd., recently talked about current conditions in the banana import market.
"Conditions in the banana market are closely tied to weather conditions. In previous years October weather has been rather cool, but we are already in the middle of October, and the temperatures in Shanghai and nearby cities is still around 30 degrees Celsius. And that is not just the case for Shanghai, Hubei, and Hunan, but Guangdong and Guangxi are warmer than in previous years as well. Bananas ripen quicker when the weather is warm, which stimulates the supply volume and saturates the market. Consumers, however, prefer to buy seasonal fruits when the weather is warm, so the consumer demand for bananas declines. These two developments create a situation where market supply far exceeds consumer demand. That is why the price of bananas has been low in the last few weeks. The current price is around 3-4 yuan [0.47-0.62 USD] per 0.5 kg," said Mr. Xia.
Most banana plantations in Vietnam and Cambodia are managed by Chinese. Their entire harvest is destined for the Chinese market. Their prices have been low as well. "Cambodia has been able to maintain a steady supply for the Chinese market around 300 shipping containers per week. The Chinese import volume of Vietnamese bananas is around 50-80 shipping containers per week. And the import volume of South American bananas remains low as well. Dalian harbor, the only port to receive South American bananas, welcomes around 80 shipping containers per week."
"The Philippines still occupy first place in the Chinese banana market. Some of the smaller banana plantations in the Philippines have been unable to secure the necessary agricultural resources during the pandemic, and the quality of their bananas has gone down. Chinese buyers have reduced their orders with smaller plantations. Large-scale plantations, however, have maintained the standard of their products. They still exceed in product quality and production volume. That is why they remain popular in the Chinese market. The price of top-quality bananas from the Philippines is around 8 USD per box of 13.5 kg. Second-grade bananas still sell for around 5-6 USD per box. Although the price of the products has not gone up much, the shipping price is still rising, which adds to the cost price of import products."
When asked about his predictions for the banana market in the next few weeks, Mr. Xia replied, "we will first have to keep an eye on changes in weather conditions. Unstable weather will definitely affect the price of bananas. The second import factor is the pandemic, and in particular the measures taken to prevent the spread of Covid-19. New waves of positive cases will have their impact on the global supply chain," explained Mr. Xia. Still he continued with optimism, "if the outbreak of Covid-19 is brought under control by the end of this year, then the price of bananas may show a slight increase."
Sophia International Trade is a company specialized in banana trade. However, there are many sudden, unpredictable changes in the market that add to the risk of banana trade. "In September last year we constructed warehouses with relevant facilities such as banana roasters and AI processing lines in Nantong, Yangzhou, Suzhou, and Shanghai. We also established booths in first- and second-tier wholesale markets. We plan to continue on the basis of our original banana import business, but with additional direct sales from production areas. We aim to provide comprehensive services from the banana plantation to the end market. The relation between supply and demand is uncertain at the moment, that is why we want to maintain our import volume, but with careful attention to product quality and post-retail services. We are working hard to provide our customers with the best experience."
For more information:
Mr. Xia Zuxiang - Board member
Shanghai Sophia International Trade Co., Ltd.
Tel.: +86 13601718690