Fund manager Gunn Agri Partners is among the investors betting on a rebound in avocado prices in the coming years, after snapping up more than $15 million worth of orchards in NSW and Queensland.
Avocado prices have fallen to just $1 each after a glut of the fruit was harvested this season
The drop in price did not put off agricultural asset manager Gunn Agri, which bought the Mountain Top Avocado Orchard just west of Nimbin in northern NSW for $11 million from growers Barry and Vickie Kuhnell.
The 117-hectare property at 578 Mountain Top Road has more than 14,000 Hass avocado trees planted by the Kuhnells since they bought the property a decade ago. Two-thirds of the orchards are more than four years old – avocado trees take four to five years to start bearing fruit.
Gunn Agri paid $10.94 million for the Mountain Top orchard, with the deal settled two weeks ago. Geoff Venn of LJ Hooker Lismore brokered the sale, which included the 2021 crop reports www.commercialrealestate.com.au
Gunn Agri managing director Bradley Wheaton said the property had been acquired for a managed account known as Wollemi Farms.
“It’s been purchased on behalf of a European institution with a mandate to invest in permanent crops assets in Australia, often leasing to local operators,” Mr Wheaton told The Australian Financial Review.
Hass avocados, which in the past have retailed for as much as $4 each, were selling at just $1 in supermarkets earlier this year after a bumper harvest in Queensland – the country’s main avocado growing region.
In Western Australia, 8.2 million trays will be picked this summer, a 233 per cent increase on last year.
Despite falling commodity prices for avocados and macadamia, Mildura-based Herron Todd White valuer Paul O’Keeffe said market conditions on the NSW North Coast remained buoyant.
Mr O’Keeffe said farming land values were firming, “fuelled in part by purchasers from capital city markets”.