Israel: Agrexco to have narrower focus, international vision

In the export market Danny Denan, CEO of Agrexco, noted the growing importance of the Russian market. While the biggest export market for Israeli avocados has traditionally been France, he estimated that about a quarter of this year's Israeli avocado exports could end up in Russia. He put the volume of fruit going to Russia at about 6,000 tons for the year, out of the 25,000 tons or so the country, as a whole, is expected to export this season.

“The French market was not so good this year with prices, it was a bit under target,” said Denan. “We've seen that traditional markets are getting more competitive, and that's been driving prices down, but in general, avocado markets are going well for us.” While he sees the added competition as a good thing because it forces everyone to become better, he also noted that added competition hasn't been the only factor in the French market. “I think it's also politics in France,” said Denan. “I think the boycott of Israeli products has been a little more severe there.”

International vision
They're interested in the international market. Pointing to their avocado business as an example, Denan highlighted the need for a strong international presence in addition to the domestic business. “We have avocados year-round, and we do that with supplies from Chile and Peru,” said Denan. “That means being a global company with an international business, and that includes having the necessary food safety standards as well as having sales teams in England, France, Germany and the Netherlands.”

Where Agrexco earlier had a large market share and many commodities, after the reorganisation of the company it became much smaller. But, as Danny Denan, points out, smaller, in this case, means more focused, and thus, better.

“We're five percent of the market in Israel,” said Denan. “We used to be much more, but we don't want to rush into a lot of volume at the moment.” He estimated that Agrexco used to hold 40 percent of the Israeli market, but it did so by providing many products that had small margins. In contrast, the new growth plan calls for a focus on high-profit commodities in order to steadily bring their market share to 15 percent in the next two years.

“It's complicated when you get too big,” said Denan. “We're not interested in a big turnover, we're just interested in being profitable.”

For more information:
Danny Denan
Agrexco
Tel: +972(0)3 5630952
Fax: +972(0)3 5630923
Email: dannyd@agrexco.com