I have been buying bananas from the same Pattaya local market for years now at 5 baht a piece. Well last week they went to 7 baht per, and now 8 baht per. I asked why so sudden and so much more and got the usual UP UP UP which I took to mean the wholesale price had gone up. Now I understand orange prices change all the time and go up a lot for Chinese new year as oranges are associated with Chinese culture, but bananas? Like I said I have always been able to buy for 5 baht (not priced by the kilo for retail anyway). So is this a Chinese new years thing or a real case of extended banana inflation?

(Please, no viagra jokes.)

Ha Ha Ha & you threw scat in my thread on the same topic. Dolt.

I was wondering why Swensen's bananas are getting smaller

Ha Ha Ha & you threw scat in my thread on the same topic. Dolt.

You started a topic about the rising prices of bananas? You don't say?

Before someone plays the cheap charlotte card and suggest anyone who can't afford an extra 3 baht should exit Thailand immediately, well, yes the increase is only about 1000 baht a year if you eat a banana daily (as I do) but consider the percentage rise, 60 percent. Imagine if overnight everything went up 60 percent. Not pretty.

The effect of banana inflation on the Thai economy is to dissipate wealth by monetizing counterfeit (i.e., "fiat") currency. To show this, it is only necessary to consider the following equation.

Let "K" be the stock of money. One good is produced, bananas. For a general price level of bananas, p = 1, then:

K = σQ or, equivalently, K/σ = Q

is a statement of the value of money in terms of goods (i.e., bananas). The term "σ" is called a capital accelerator. It relates the amount of capital, K, required to produce a real output Q, 0 < σ < 1 in a profitable wealth accumulating economy, while σ > 1 in a wealth dissipating economy (you can guess in what range σ lies in China and the US presently) .

It may be too obvious to state that K * 1 = K, where p = 1, but it is obvious that K * 1/p = K' ≠ K unless p=1. The term 1/p is the purchasing power of money in terms of bananas.

Inflation turns economic relations into a hall of mirrors because the term 1/p is normally suppressed -- US$100 in 2010 will purchase only about the amount of bananas that US$13 would buy in the 60's due to the reduced purchasing values of money in banana terms.

Therefore, the correct statement of the "banana value" of money is:

K/(σp) = Q. The addition of the "p" term to the accelerator is what makes the equation "non-conservative", or wealth dissipating.

The accumulation of profit can be written as:

dK/dt = (1 - u)* Q, where u is the wage share of output, so (dK/dt)/K = (1-u)/(σ*p) gives the rate of capital accumulation.

There are several interesting items to note from the equation above:

Rapid monetary expansion (i.e., inflation) will produce high employment (at least for a time, until price and wage expectations are adjusted), but at the expense of the aggregate wage share. This means that most skilled employees will be underpaid, and an army of unskilled workers will not be laid off, and, as a consequence, are "overpaid" -- Obama/Bernanke economics?.

The loss of wage share is the friction, or viscosity (whatever you call it), whereby inflation destroys the real economy. It is the reason that inflation, as JT notes, is a serious problem that should concern everyone, because as wage share decreases, so also does aggregate banana demand (unless bananas are economically "inferior" goods -- note that all goods cannot be "inferior").

The socialists who will object to the cyclical fluctuation of the employment percentage (coupled with the business cycle) should bear in mind that the wage share will be in the 90+% range (the remainder being paid to the owners of capital), so the working man will generally be quite comfortable, except for the unskilled who will periodically be sent home to drink, play cards and beat their kids and dogs.

With a return to stable banana prices, JT can sleep more easily, and savings and investment will once again be viable options, and the Thai economy will be "saved" (poor expats will still complain about the value of their Pounds, Euros or Dollars against the Baht, but such is life here in Thailand). Tis a condition devoutly to be wished. And this from the price of bananas..................

Wow you must have a big banana Jingthing.

Here in the boondocks a kilo of small bananas (about 20 'on the vine') can be got for 25 baht in the commercial markets and 20 baht in the villager's own weekly markets. Delicious - I buy a bunch every 3 days at least in season.

We have banana trees in our garden; well actually it is the government/utility marginal land out front, but convention in Issaan says you can grow on it and claim the produce. However, the wife's family seem to think that our garden is free produce for them and, just as I am surmising that a particular tree will be right for picking next week, my father-in-law turns up at the dead of 6am and hacks the fruit off to take to old relatives or the wat! It used to drive me mad, but my wife's reaction left me with the strong impression that this is entirely to be expected. This is Thailand - now I just go with the flow

The food price spikes continue. Yesterday I was quoted 30 baht for a street cart guava. I have never seen the price for that be anything other than 20 baht. That's a 50 percent spike overnight. What's the hap? Well here is another explanation --

In the past few months, skyrocketing food prices have raised concern among economists and anti-hunger advocates—and rising food costs have even helped foment revolutions. This week, the World Bank reported that food prices increased 15 percent from October to January and have climbed 30 percent in the past year. Currently, the bank's price index sits just 3 percent below its 2008 record. The United Nations' Food and Agriculture Organization keeps a separate index of food costs—and it blew past the all-time record last month. Wheat prices have doubled since last summer. The price of corn has risen about 75 percent since June. Prices for sugar and cooking oils have also jumped. The consequences are potentially devastating. The World Bank says that spiraling food costs have driven 44 million people into extreme poverty since June 2010.

http://www.slate.com/id/2285530/

You may find that it is a knock on effect of the recent bad weather in Australia that has wiped out a huge slice of the banana crop.

Ergo price of bananas go up and it don't matter if they are local produce that aren't fit for export, any excuse is a good one especially in an economic downturn.

No there is something global going on here.

I buy my bananas from the local stall next to the village 7/11 and I usually get 15 reasonable size ones for 35 baht or 20 small ones for 25 baht.

The price hasn't really gone up around here for ages BUT Khampaeng Phet is one of the biggest banana growing provinces in the country.

Yes, I am talking retail in Pattaya. The banana price has calmed down. Friendship Market which for years has been 5 baht per piece recently marked up to 6. That's more like it assuming it's justified.

In any case, something is happening globally to the food market and it is threatening governments as well. The red shirts didn't beat Abhisit, but I don't think Thailand is immune from these kinds of food price inspired revolts either.

I noticed around 3 to 4 weeks ago the bananas on the local talad nats/sots were asking 40 baht whereas before they were 25. That's a massive hike. I wondered why on earth THE most available year round fruit here had taken such a leap in price.

Happily, I have a row of my own banana trees alongside my house, 'though have had banana rustlers and just a bunch left. Ah well. Too many of them and never did get round to making banana wine ...

No there is something global going on here.

These are regional things for Thailand. IMHO, the only global impact would be oil commodity manipulation which results in higher fuel prices.

Not ot digress from bananas, but we grow mangos. The main costs involved are fertilizer, fuel to get to market, ripening bags, plastic crates, and labor to bag and harvest the product. These are probably not unlike bananas.

Fertilizer has gotten more expensive in recent years. Fuel has been high for many years. Bags and crates are the smallest cost. Labor costs have gone up because there are fewer and fewer people who are available or who want to do the work. Having to pay 300 baht per day versus 200 baht per day is a big difference.

These things either drive farmers out of the business or result in higher prices for the consumer to make up the difference.

It is also worth noting that on a regional basis, fruits can go in and out of season. We typically get a couple of mango harvests a year. If we are lucky, one of those comes in while other farms in the area are not producing and a higher price can be obtained at the market.