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Andrew Maughan - FreshMax
"People talk about China like it is a holy grail for everyone's oversupply problems"
"We have a great relationship with Sunworld, their breeding programs and their business model are very innovative," explains Andrew Maughan from FreshMax. "A big part of the advantage with SunWorld is the global network which you become part of with the other licensees. There are many benefits to being part of the SunWorld family, its about more than just the genetics."
Andrew Maughan - IP Management & Commercialisation
"They have some nice varieties which do very well in our Australian domestic market, where we have 150 hectares of orchards and have just started to harvest the stone fruit which will go to the domestic market for Christmas."
The Chinese market has just opened for Australian stone fruit. This is a great opportunity, according to Andrew, "China is a big focus for our group as a whole across a lot of categories. The challenge with China is that people are talking about it like it is a holy grail for everyone's oversupply problems, but it takes time till you get to know your way around the market."
He goes on to say that when citrus and table grapes got access to China it took a while to settle down and for exporters to get the protocol right and to deliver the right product. "It has been a really big, positive influence on our table grape and citrus producers in Australia," said Matthew. "This makes it easier when other products gain access, Freshmax New Zealand and Valley Fresh are already established in China and we have specialists on the Chinese market within our company."
Although it is great to get formal access to China for stone fruit and build relationships with some of the e-commerce players and the direct retailers, Andrew does not see this as being the magic bullet for stone fruit right this minute.
"It is great for the future and we can be more export driven and manage our domestic stock levels. China does have special requirements though, colour is important for them and they like big fruit, much bigger than our domestic market so it means a little change of growing styles to get bigger fruit size," admits Andrew.
"We have the Paraguayo, or flat peach which we are already sending into Asia. We have been working with a Spanish breeding program for a while and we have 10 different varieties of flat peach in quarantine. Our intention is to have a flat peach offer right from the start through to the end of the season, we see this as a great potential in China, as well as a great domestic category extension."
Plums are also a great prospect for China, they have a longer shelf life and are easier to ship via sea freight, nectarines also have fairly good storage.
"You have to deliver the right product to China, plums need to be big and hard, crunchy and sweet. Although saying this there are also substantial differences in the different parts of China as to what their preferences are. Typically what we export now to Asia is white fleshed peaches but there is demand for yellow flesh in the northern parts and there is an opportunity to expand the market. The cool chain management is getting better and the cities are growing rapidly, there are also some significant 'minor' cities in China which are huge compared to some Australian cities like Melbourne and Sydney which have 4-5 million people and these are ten to the dozen in China."
Another important market for FreshMax is India, which is also a growing market but can be difficult when it comes to hitting the price points. "The Australian domestic prices have been quite good so there has not been the export focus," explains Andrew. "We need to get a bit of consolidation in the Australian market too, there are a lot of small growers and packers, but when you want to start exporting on the global stage you need long supply lines and need to be able to do full containers of one or two counts. We have seen in other countries where companies have come together and formed alliances and work for the common good. We see that as part of the future although some categories already have that in Australia, citrus and grapes for example. They are very export focused, 40% goes for export, whereas apples and pears are less than 5% export, stone fruit around 10%. So we really need to be increasing those categories to 20-25% export."
Freshmax is very much focused on global trade, and have people based in many countries throughout the world, they source from third parties in other countries to supply their Asian and Australian markets.
"It is certainly better if you can supply the retailers on a year round basis. The world is becoming a smaller place and we are challenged geographically in Australia, so Asia is certainly a focus for us and you need a certain skill set to succeed there. We have quite a few Chinese speaking people in the company, this helps a lot as they understand the customs and the culture."
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