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AU: Low tomato & capsicum prices following Debbie could put growers out of business

While shoppers may be enjoying the recent drop in the price of capsicums or tomatoes, they may be disappointed to learn that the reason behind it is nothing to celebrate.

These cheaper vegetables are evidence of a violent blow dealt to the economy by Cyclone Debbie exactly six months ago, worsened by a series of factors to the point where it has now cost Australia billions.

The problem began even before Debbie tore into the Whitsundays region, when farmers close to the disaster zone began planting extra crops to cover any shortfall, according to capsicum grower and Bowen Gumlu Growers’ Association president Carl Walker.

Farmers whose seedlings were ripped from the ground by the cyclone then also planted extra to catch up. This combined with an unusually mild winter and early spring to result in “a vicious cycle of overproduction.”

Prices of capsicums and tomatoes plunged, and thousands of excess vegetables are still being produced for the domestic market each week. 

“Some guys I know will lose millions of dollars, which is no good for the long term industry,” said Mr Walker. “We’ve not been covering our costs. If we’re not getting $2 for a kilo [of capsicums] at market, we’re going broke."

"All these things go into a business, it’s not sustainable. No one’s making money. It’s been the worst thing for the industry.”

Tomatoes saw an initial surge in price at the time of the cyclone, before plummeting to just $13.65 for a 10kg carton in August 2017, down from $24.46 in August 2016, according to Ag Answers Rural Bank senior analyst Matt Ough.

Capsicums also rose in price slightly before dropping to just $12.50 for an 8kg carton in July and August, compared with $23.71 in August 2016.


Publication date: 9/29/2017


 


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