The Price of Bananas Set To Rise
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Farmers are facing at least $500 million in crop losses from CycloneLarry, with banana prices rising steeply after most of Australia'sproduction was wiped out by the storm.
Larry destroyed 80 percent of Australia's banana crop - a loss of at least $300 million - andPrime Minister John Howard pledged financial support for Queensland'sdevastated industry.
"When something comes along like this andflattens you, then you are entitled to say 'Well, can somebody give usa bit of a hand to get back on our feet?'," he told Macquarie radio.
"That ought to be the aim of the government and it will be the aim of the government."
MrHoward will tour areas of north Queensland hit by the maximum Categoryfive cyclone on Wednesday, and federal Agriculture Minister PeterMcGauran will visit the region on Thursday.
Other farmers werecounting the cost of the storm, with as much as 10 per cent ofAustralia's sugar production wrecked and the avocado industry taking a$15 million hit.
But the banana industry suffered the biggestlosses, with growers already beginning to lay off staff amidpredictions of 4,000 job losses in the industry.
Retail pricesfor the fruit have already cracked $5 a kilogram - about double theaverage of $2.50 to $3 - and are expected to hit $6 or more as supplyruns out in the coming weeks.
Just 24 hours after the cyclone,bananas were selling at $40 a box wholesale in Melbourne on Tuesdaymorning - double the usual price.
"The market opened at Melbournethis morning at $40 a carton - take it or leave it, they said. That'sdouble what we were receiving a week ago and a bit over double whatwe'd average for a year," Australian Banana Growers Council presidentPatrick Leahy said.
"The merchant said he could have sold them for $100 a carton, but we've got to be sensible about this."
Withsupplies beginning to run down, prices were up by around $1.50 a kgaround Sydney on Tuesday, with supermarket giants Coles and Woolworthsselling at about $4.
Growers Council chief executive Tony Heidrich said more dramatic price rises were expected.
"I think $6 a kilo is realistic and I wouldn't be surprised to see them go higher as time goes on," he said.
With 200,000 tonnes of fruit destroyed by the cyclone, Mr Heidrich said it would be a long road to recovery for the industry.
"We'llstart to see the first flush of fruit about nine months from now, butcertainly most growers won't be coming back into production for 12months," he said.
The sugar industry estimated its losses at $200million in cane crops alone, with 10 per cent of Australia's sugarproduction lost in the cyclone.
Peak industry body Canegrowers said the loss could drive producers off the land after years of poor prices.
"We have to face the cold, hard facts. This is going to wipe some growers out," Canegrowers general manager Ian Ballantyne said.
"Aftersuch hard years, especially for those who have lost everything duringLarry, many of our sugarcane growers will have a tough time recoveringfrom this blow."
Larry also cut a swathe through a major avocadogrowing area on the Atherton Tablelands, wrecking 4,000 tonnes of cropsworth $15 million.
I'll miss eating bananas for a while.
Nothing goes better with my Frosties :o(