Banana exports increase in northern Laos
Banana exports increase in northern Laos
Farmers in some areas of the northern provinces have shifted to grow bananas after the price of the commodity increased as a result of high demand on the Chinese market.
Luang Namtha is one of the northern provinces to see an expansion of the commercial cultivation of bananas for export, with many investors taking out land concessions or entering into contract farming arrangements.
The province currently has more than 1,000 hectares of banana plantation, most of which are being invested in by Chinese companies.
The provincial agriculture section Head, Mr Padith Chanthanouvong told Vientiane Times yesterday that farmers in some areas, especially Long district, are spending their capital to plant the fruit after the price of bananas rose due to increasing demand from China.
The price of bananas rose from 3,000 kip per kg over the last few years to 9,000 to 10,000 kip currently, Mr Padith noted.
Due to the high demand for bananas on the Chinese market, the numbers of Chinese investors coming to Laos to farm the crop have increased, in particular in the northern provinces of Luang Namtha, Bokeo and Oudomxay.
The actual quantities of bananas being exported from the provinces to China has not been reported on by provincial authorities.
However due to negative impacts to the environment and a reduction in rice production, provincial authorities have banned banana expansion into rice field areas and aim to better manage the use of chemicals.
Under contract farming, the companies pay about eight million kip per hectare in land rental to farmers for a concession period of three to five years, which has currently increased by about 17,000-18,000 kip, Mr Pasith explained.
Investment in banana projects is conducted in the form of a 1+4 scheme as the local people only receive funds from leasing the land while all the other benefits go to the investors.
“Most farmers thought that the revenue they would get from leasing their land would be higher than rice crop production but the major issue we are worrying about is what farmers will do when they finish spending their concession money.”
“Also, how will they improve their land after the 3-5 year concessions expire,” Mr Pasith asked.
Provincial authorities are currently coordinating with government officials to try and solve the issue.
However, some farmers are still using their farmlands for planting other commercial crops for sale and export as well as cultivating rice for family consumption.
vientiane times
