2017 Volume 12 Issue 2 Pages 261-279
This paper examines how the system from the production to distribution of bananas from Taiwan for the Japanese market has been established since the liberalization of banana exports, while focusing on the Japanese banana market and distribution system. It also analyzes the characteristics of Taiwan's banana industry for export to Japan since liberalization. After liberalization, in order to respond to the safety-conscious Japanese market, bananas in Taiwan have been produced and exported under the guidance of the Executive Yuan Council of Agriculture. The liberalization of banana exports allowed competition. Consequently, bananas for the Japanese market are traded at domestic Taiwanese market prices that are both high and unstable, making price control impossible. In the Japanese market, the quality of Taiwanese bananas has improved since liberalization. It also appears some importers of Taiwanese bananas sell them directly to retailers after applying ripening processes. However, most importers still go through the wholesale market with traditional transactions, and therefore the prices of bananas from Taiwan are driven by producers. On the other hand, the retail prices of bananas in the Japanese market are determined by retailer leadership. Therefore, Taiwanese banana price formation is not sufficiently flexible for the Japanese banana market. Banana exporters in Taiwan rent land from the Taiwan Sugar Corporation under the condition that they produce bananas only for export. However, the land rent soared, and the upper limit for the rented land was set throughout Taiwan to avoid competition with domestic farmers. Taiwan's banana industry has been working hard to expand exports by maintaining opportunities for domestic growers. Taiwan is now entering a new phase in which it must strengthen banana exports while protecting domestic banana growers in the age of globalization.
