A Chinese banana grower has urged businessmen to be cautious about investing in the Cambodian banana industry, which last month was granted Chinese market access.

Export protocols were signed between the two countries on Aug. 3, making bananas Cambodia's first fruit allowed for export to China.

The development has opened up investment opportunities for Chinese businesses - an opportunity Longmate Agriculture Co has taken, investing in banana plantations in the Kampot area and creating some 600 jobs, according to local media. 

However, Yuan Chao Yao, a Yunnan Province-based banana producer and marketer, told Fresh Fruit Portal that those in the Chinese banana industry should not invest blindly without considering the significant risks.

Yao said that many investors have looked to Myanmar, Laos and other Southeast Asian countries to rent land and grow bananas, but he explained that conditions eventually change and many fail to make a profit.

For example, he said that in Laos, the unstable political situation along with changes to the strict control of the use of pesticides had caused hardship for many investors.

Although Cambodia has liberalized its investment policies, the future situation is still unclear, Yao said, adding that normally a significant investment in large-scale plantings is needed to turn a profit.

Chinese banana market

Cambodia is expected to mainly supply bananas to China's premium market, and Yao did not anticipate there would be much impact on the market in general.

Asked about the main problems facing the Chinese banana industry, Yao said that many growers are fighting Panama disease Tropical Race IV, which is limiting the amount of adequate land available for growing.

The planting potential of China's banana industry is not fully utilized because of growers lack investments, knowledge about technology, and there are problems in management, he added.

However, in recent years China's banana planting industry has developed rapidly and the availability of technology to resist diseases has also been significantly improved. In particular, the widespread promotion of some vaccines and fertilizers has also been effective in improving quality and yields, he said.

Yunnan, one of China's biggest growing regions, is currently in its off-season, with shipments to run from November through around May. The peak of shipments is usually in March to May, around where Guangxi and Guangdong bananas go onto the market.