(Ecns.cn)--Within little more than a month banana prices in Hainan Province plummeted from 7.6 yuan to 0.4 yuan per kilo, leaving nearly 95% of local growers in desperation, according to a Guangzhou Daily report on July 5.
Wu Shenping despaired as his banana trees were cut down. The 35-year-old farmer suffered a loss of hundreds of thousands of yuan at his first attempt to grow bananas.
Early this year, Wu paid 200,000 yuan ($31,000) to rent more than 100 mu (16 acres) of farmland, later investing about 100,000 yuan ($15,000) to set up farming facilities. But even though Wu had a good first harvest, his dreams of tidy profits were dashed by a purchase price of only 0.3-0.4 yuan (5-6 cents) per kilo.
"Before, there would be many trucks coming to purchase bananas, but no trucks have showed up yet. There are still 40 mu (6.6 acres) un-harvested. The bananas there may end up rotting in the ground," said Wu, smoking heavily. "I lost 0.7 yuan (10 cents) for each kilo I sold. I can't imagine what will happen to me in the future."
How bad can it get?
Wu is not the only victim. Statistics from the provincial Department of Agriculture show that the total planting area this year covers 875,000 mu (144,000 acres)， with a total output of 1.9 million tons. By June 30, about 430,000 tons had already faced sluggish sales.
Nearly 95% of growers are losing, said Shao Shiwen, manager of a banana company and ex-chairman of the Hainan Banana Association. "70% of the bananas were sold at low prices, only 0.4-0.5 yuan per kilo. The purchase price should be at least 1 yuan (15 cents) per kilo for farmers to make profits. This year, a large number of growers are losing 4-5 million yuan ($62-77 million). A 1-million-yuan ($155,000) loss is actually quite small, comparatively speaking."
Bananas were quite profitable in March, with the purchase price hitting a record high of 7.2 yuan ($1.1) per kilo in April. However, after April 15 prices began to plunge, dropping to 0.4-0.6 yuan per kilo by the end of May.
