Led by booming bananas, the fruits of Taiwan are coming into their flavor-deserved own as principal suppliers of foreign exchange. Bananas earned US$33 million last year, second only to sugar among agricultural exports. Pineapple was up to US$14 million, and oranges were growing fast. So were some other exotic fruits, from litchis to longans, from papaya to pomelo.
Bananas are undisputed ruler of the fruit preserve, especially since last year. For 1964, Taiwan exported 4,145,000 baskets of bananas (48 kilograms a piece), almost all to Japan, which prefers them to all other varieties. In fact, if Taiwan can meet the demand and deliver the fruit in top condition, the Japanese market can be monopolized. In the pre-1945 era, when Japan occupied Taiwan, banana exports to the island empire reached 3,500,000 baskets.
After World War II, Japan imported foreign exchange controls on banana imports, and only fruit dealers with foreign exchange earning records were permitted to participate. More than 95 per cent of Taiwan's banana business was taken over by exporters who had connections with Japanese eligible to do the importing. These middle men made profits as high as 20 per cent, and growers could expect only half the FOB price. Interest in production declined.
With Taiwan failing to meet the increasing Japanese demand, bananas from Central and South America invaded Asia's prime market. In 1963, about four-fifths of Japan's banana imports were from the Americas.
The export price of Central and South American bananas is about US$6.5 per basket, substantially lower than the Taiwan figure. However, Taiwan still can compete because of geography. A shipment from Central or South America takes 20 days versus the 3 or 4 from Taiwan. Growers in the Americas have to harvest immature bananas to reduce spoilage. This means a sacrifice of sweetness and flavor.
Cost of Taiwan bananas in Japan is 5,151 yen (US$14.30) per basket, providing a profit margin of 471 yen. In May and June, when the supply from Taiwan is at its peak, the price of Central and South American bananas falls below the imported cost.
Japanese duty on bananas is 70 per cent, which has kept prices high. A cut to 50 per cent was sought for this year, but opposition of Japanese fruit growers was too strong. For the present, there will be no reduction.
Bananas of Taiwan are large and tasty. (File photo)
Since World War II, per capita consumption of bananas in Japan has fallen to less than one kilogram annually, half the pre-war level and one-sixth to one-eighth the figure in Western countries. However, consumption has been increasing by leaps and bounds since Japan eliminated import surtax and quota in April, 1963. Taiwan's monthly exports reached more than 800,000 baskets in May of 1963, breaking the pre-war record of 600,000. Daily shipments averaged 30,000 baskets. In two months, exports exceeded the total for all 1962.
Some 10 ships with cold storage facilities are carrying bananas from Taiwan to Japan and more are being procured. A large cold storage facility is being built in the southwest port of Kaohsiung, banana exporting center. Spoilage has been reduced sharply. According to conservative estimate, US$l million has been saved in the last year or so. The average rate of spoilage was 5.8 per cent from 1952 to 1961. The figure was 0.45 in March and 0.50 in April of last year.
Bananas grow island-wide and year-round in Taiwan. Main production areas are Nantou and Chiayi in Central Taiwan and Kaohsiung and Pingtung in southern Taiwan. Although bananas are more profitable than rice, the government discourages farmers from turning paddy into banana plantations. Thus the shortage of land also has been an obstacle to increased production of bananas.
Production distribution is uneven. Taiwan is subject to typhoons from July to October, and farmers like to harvest bananas early to avoid storm damage or loss. Thus peak production and export come in May and June. Central and South America, which are less seasonal in banana supply, receive a competitive advantage.
More for Growers
The Foreign Exchange and Trade Commission set up a Banana Production and Marketing Guidance Committee in April, 1963. It set the export ratio between growers' organizations and exporters at 50-50 and the export price for the six months between April and September, 1963, at NT$280 (US$7) per basket CIF. Of this amount, NT$163 went to the grower, 50 per cent more than before. NT$42 was allotted for inland transportation and packing, less than before; NT$40 for marine freight and insurance; and NT$35 for export expenses and profit. Of the growers' organization profit, half was to be used for improvement of production and marketing and the other half paid to growers the day after the fruit reached the port of shipment.
Further measures have been adopted since. The CIF price has been raised from US$7 to US$8. The additional dollar goes to the grower, raising his share to NT$203 per basket.
A new pricing system is designed to make production less seasonal. Beginning last April, prices were set each month to encourage farmers to grow more fruit in the winter months. Replacement is not allowed if the spoilage is less than three per cent. Thus a replacement cost of US$7 can be saved from the NT$35 set aside for expenses and profit. This will be added to the fund to improve production. The net profit for exporters remains virtually unchanged. The formula of half of remaining profit for improvement and half for growers is unchanged if the bananas are exported by growers' organization.
To break the monopoly at the Japanese end, more licenses were granted. In the six months from April to September, 1963, only five Japanese had the right to import Taiwan bananas. In the period between October, 1963, and March, 1964, licenses were opened to all and 280 were issued. Importers chose their business partner in Taiwan, except that exports were divided between the growers' organization and exporters.
New Acreage
During the Japanese occupation, peak banana acreage was 21,000 hectares producing 210,000 metric tons or 4,400,000 baskets. After World War II, annual production declined to as little 100,000 metric tons. The top year before relaxation of marketing controls was in 1962, when 130,000 metric tons was produced on 18,000 hectares.
New plantations are being established in the Puli basin of Nantou, which is comparatively free of typhoon damage. Mountain slopes are being reclaimed and made cultivable with soil conservation measures. Banana growers added 6,000 hectares to old plantations in 1964.
Superior disease-free seedlings are being planted. Growers are adopting close planting and other new techniques. The government has extended loans for windbreaks and tree supports.
Fertilizers are distributed by the government, which also helps with pest control. Banana stem weevils, which almost destroyed plantations in the Nantou area, were brought under control through government and growers' efforts.
Other Fruits
Per hectare yield has increased from 7,109 kilograms in 1962 to 11,500 kilograms in 1963 and 12,000 kilograms in 1964.
It is estimated Japan's annual demand will reach 10 million baskets in 1965. The government predicts production of nine million baskets and export of eight million this year for earnings of US$64,000,000.
Taiwan has two other fruits that are being exported in quantity. They are pineapples and oranges.
Oranges are waxed preparatory to export. (File photo)
Pineapple is exported only in tins. Principal buyers are West Germany, Holland, Great Britain, the United States, and Canada. Taiwan canned pineapple is found even on the shelves of groceries in Hawaii. In production the island is third, behind Hawaii and Malaysia, but it is the world's largest exporter.
Output was 65,567 metric tons in 1954 and 240,000 metric tons in 1964. The 1964 earnings of canned pineapple were US$14 million.
The island's largest plantation of Laopei typifies pineapple growing success. Located at Pingtung in southern Taiwan, it has an area of 1,200 hectares (2,965 acres). In the Japanese era, wilt was so rampant that experts wrote off the farm and rejected further trials.
Sino-American agricultural specialists subsequently took the view that wilt could be wiped out. They found the disease was not caused by a virus, as had been believed, but by an accumulation of toxin from a mealy bug infestation that was spread by ants. The ants carry the mealy bugs from plant to plant in order to collect the honey-like substance secreted by the bugs. The experts studied the habits and behavior of both pests, the effect of climate and natural environment, and the effectiveness of various pesticides. They finally decided to use Parathion against the mealy bugs and Aldrin against the ants. Pineapple seedlings are disinfected before planting and are sprayed twice during the growing period.
Other problems also had to be overcome. Laopei needed more water and more farm hands. The location was out of the way and labor was scarce. A tractor cut down on the need for manpower. Wells were drilled. Scientific management was introduced.
Results were good and other plantations did likewise. Wilt was brought under control. Close planting was widely adopted. Formerly, only 20,000 pineapples were set out on each hectare. The number has been doubled on most plantations, and yield is up by 50 per cent.
Plantations are spread over central, southern, and eastern Taiwan. The total acreage is about 13,000 hectares (40,000 acres). Eastern Taiwan is a newly developed center of pineapple cultivation and has the largest and best-equipped cannery among the 23 on the island. Operated by the Taiwan Sugar Corporation, it has annual capacity of 800,000 cases. Once backward and poverty-stricken, the eastern part of the island is now pineapple-prosperous. New brick farm houses dot the mountain slopes.
Three Oranges
Oranges also are grown everywhere and throughout the year. There are three main varieties. The loose-skinned Ponkan is the largest and juiciest. It grows mainly in central Taiwan and ripens in late November or early December. When Ponkan disappears from the market in January, it is succeeded by the smaller Tonkan from northern Taiwan, including the Taipei area.
Valencias come to market in March and April. This variety has become the mainstay of orange production in eastern Taiwan. Judging from high quality and resistance to spoilage, it may become the backbone of fresh citrus exports, if the market is expanded.
Ponkan, which brings a higher price than Tonkan, is sold to Hongkong, Manila, and the Ryukyus. Tonkans are exported to Singapore. Because these two varieties are susceptible to easy spoilage, they cannot be shipped long distances. Canada will buy Taiwan Ponkan, if shipping facilities are improved. Canada now imports 3,000,000 20-kilogram cases of oranges from Japan every year.
Japan, though producing oranges itself, is a potential market for Taiwan oranges in view of seasonal differences. That country bans imports from Taiwan, however, because it fears the fruit fly. Taiwan claims the fly has been eradicated. This fact has been gradually recognized by Japanese experts invited to Taiwan to see for themselves.
Another orange export weakness is the necessity of reaching overseas Chinese markets during the Lunar New Year season in January and February. The entire process of picking, gathering, grading, waxing, and transporting must be geared to this golden opportunity.
Spoilage Reduced
Despite these difficulties, orange exports set a record in 1964. Fresh oranges earned about US$1,800,000 and the canned variety around US$2,400,000. Exports still lag behind production. At the end of World War II, most of the orchards had been abandoned. Production in 1945 was only 16,877 metric tons on 3,584 hectares. In 1963, 18,856 hectares were cultivated and production reached 78,680 metric tons. The 1964 goal was 20,000 acres and 93,500 metric tons. Because Taiwan was spared by typhoons in 1964, production exceeded the target.
In 1951, the Joint Commission on Rural Reconstruction and the Provincial Department of Agriculture and Forestry undertook a joint survey of trees and the training of growers. Farms were established to grow seedlings for commercial distribution.
Training emphasis has been placed on reduction of injury to fruit. Pickers have been persuaded to use gloves, scissors, and bags. The spoilage rate of export citrus has been cut from the 30 per cent of 1958 to an average of 10 per cent in the last three years.
Young girls dominate the working force of Taiwan's modern and highly efficient canneries. (File photo)
Lemon are grown but not in large quantities. Local demand is small and exports have not been developed. The pear-shaped pomelos are famous. They are sweet and thus differ from the sour grapefruit of the same family. Pomelos mature in fall, are grown in both white and pink varieties, and have excellent export potential. Some are being sold in Hongkong and Singapore.
Taiwan's watermelons grow lushly in the coastal area south from Hsinchu. There are a number of varieties. The biggest were grown in winter on the riverbed of the Kao Ping Chi (river), between Kaohsiung and Pingtung. Before the flood season ends in August, farmers stake out the land from rafts. Water comes from the river or from wells.
Other areas grow melons in the summer. Special varieties have been developed for export to Hongkong. Melons have been introduced to South Vietnam and Dahomey by Chinese agricultural missions.
Muskmelons were introduced from the United States several years ago, and have be came a specialized product of the Penghu islands.
Pingtung is famous for papaya as well as watermelon. Because of easy spoilage, it is not exported fresh. Every hsien has its specialty: longan for Tainan, mango for Chiayi, litchi for Taichung, persimmons for Miaoli and plums for Dan.
Longan, literally dragon's eye, is regarded by Chinese as a tonic, and the fruit is sold by herb shops as well as by food stalls. Mangoes are popular in Taiwan. The trees line Chiayi roadways and have become an important source of revenue for several local governments. Taichung's litchi was introduced by former residents of Putien, a litchi production center in Fukien province on the mainland. The fruit ripens in June and July and enjoys a brisk but brief season. Both longan and litchi are canned and exported. Persimmons are sold in both fresh and dried forms.
The weakest links in Taiwan's first production are provided by the deciduous varieties. However, the mountainous terrain of this subtropical island makes cultivation of deciduous fruit possible. Since completion of the East-West Cross-Island Highway several years ago, the government has been importing seedlings of various kinds and planting them on slope land at elevations of from 3,000 to 10,000 feet. The first crops of apples and pears were marketed locally last fall. Fruit is smaller than Japanese and Korean varieties but equally tasty. In time to come Taiwan may be known as one of the only areas of its size producing both tropical and temperate fruit in sizable quantity.