Effect of cyclone on bananas
Queensland was hit by a cyclone and massive floods. Lots of people lost their homes and many crops were damaged. Farmers were left with fields that looked like this. Millions of banana plants were easily destroyed. While they might look like big strong trees, banana plants are actually really fragile. In the end, three quarters of Australia's banana crops were wiped out. It devastated the industry, because for every 10 bananas sold in Australia, 9 are grown in Queensland.
But it didn't mean that supermarket shelves were completely empty of bananas, because places like New South Wales and Western Australia grow them too. But nowhere near enough to meet the demand and so at the height of the shortage post-Larry, banana prices went sky-high from $2 per kilo to around $15.
As a result, the demand for banana was going down, customer tends to buy more on other substitute products such as orange, mango and apple.
Sydney Market Reporting Service fruit surveyor Chris Cope said the flood of bananas to urban markets had become a trickle since Yasi struck.
"On New Year's Eve, we broke our record for quantities coming on to the Sydney market with 245,000 cartons of bananas in one week," Mr Cope said. "For the last couple of weeks, we've had 30,000 to 35,000 cartons a week."
"We've gone from very cheap prices before the cyclone -- $12-$16 per 13kg box for good bananas, now at $135-$150 per box, and the quality is worse."
Mr Cope said the situation was likely to worsen as winter set in and production dropped even further, but he refused to speculate on how high prices would go.
Prices after Cyclone Larry stayed high for nearly a year, but this time they are expected to gradually decrease from about late August, depending on the weather, as cyclone-affected farms begin picking again.
Australian Banana Growers Council chief executive Jonathan Eccles told The Australian that growers were getting up to $10/kg wholesale. That, he said, was a massive jump from last year, when a banana glut drove the wholesale price as low as $1/kg. Mr Eccles said prices should return to normal by the end of the year.
"Gradually, we'll build up to full production by December," he said.
Banana grower Graheme Celledoni's 15.5ha property at Mourilyan, 95km south of Cairns, was flattened by Cyclone Yasi. He is now without income until August, when a small portion of his plantation's fruit will be ready to be sold. But he said the damage was less severe than after Cyclone Larry, when all his trees were uprooted.
Michael Luscombe, the chief executive of Australia's biggest supermarket chain Woolworths, says bananas price will begin to fall as crops become ready for picking in October.
"There's no doubt that by November bananas should be back in reasonable supply," Mr Luscombe told analysts on Wednesday.
"Bananas, which have traditionally been selling for around the two or three dollar mark might get as low as a dollar again, so we'll have deflation in produce."
The company's analysis is based on planting activity after recent devastating cyclones.
"It's a strange situation that typically after a cyclone, rather than planting on a staggered basis, just about every hectare gets replanted," Mr Luscombe said.
"And of course all of the bananas ripen at once and come market all at once, so there is a big flood that comes through.
"It usually takes the best part of six to 12 months for that to even out."
Despite a colder than usual Queensland winter, supply would slowly move up to 100 per cent in the upcoming months.
"What you will see is, as the months go from 40, 60, 80 per cent (of supply), the prices will come down and then I would be very surprised if we don't suddenly have 120, 130 140 per cent of normal supply," Mr Luscombe.
"That will mean the price the consumer receives will probably plunge."
Woolworths director of supermarkets, liquor and petrol Greg Foran said cooler than usual weather in northern Queensland had led to a shortage of capsicums but the mango season could be brought forward by three or four weeks.
"Fingers crossed, we could do some really good business in mangoes," he said.
"Cooler weather has slowed things down with bananas and we're not going to see light at the end of the tunnel until October."
