Potential Economic Impact of Panama Disease (Tropical Race 4) on the Australian Banana Industry

Abstract

Panama disease, caused by Fusarium oxysporum f.sp. cubense tropical race 4, is considered to be one of the most severe threats facing the banana industry worldwide. Tropical race 4 has rapidly spread throughout Southeast Asia since first being reported from Taiwan in 1990 and Indonesia in 1992. It was first discovered in Australia in 1997 where strict quarantine management contained its distribution to the Northern Territory for almost two decades until March 2015 when it was detected in Tully, North Queensland. The spread of this disease to the major banana production areas in Queensland could have a severe impact on the Australian banana industry as no effective chemical control options exist and no resistance has as yet been identified in agronomically acceptable banana varieties. However, given its successful containment in the Northern Territory there is uncertainty about future losses, and consequently what resources should be expended on its continued control. In this paper, we construct a dynamic model to estimate potential financial consequences for the Australia banana industry over time if the disease spreads beyond its current distribution. Scenarios modelled account for the possibility of spread via natural means described by a diffusion-like process, and also by large jumps mediated by human activities. Aggregating results of likely spread over time, we predict the disease will cause industry losses exceeding $138 million per year despite a slow rate of spread.