Phil Turnbull, APAL CEO, shared this update to industry in the Summer 2023 edition of AFG.
As we come to the end of another year, we contemplate the challenges, tests and triumphs that have reverberated across our industry. Recalling a time in recent memory when our sector wasn’t faced with hurdles or barriers feels almost impossible, and this year has been no exception.
The adverse weather events in the Goulburn Valley this season sent shockwaves through our industry’s most prominent growing region. As a result, we saw a sharp dip in volumes for this season, with approximately 35 per cent fewer pears and 12 per cent fewer apples in the national Class 1 supply of pome fruit.
Despite our expectations for improved pricing driven by reduced supply and robust consumer demand, the reality differed. Although wholesale and retail pricing saw an uptick, consumer demand somewhat softened over time. Additionally, growers faced escalating input costs, labour challenges and the persistent struggle to secure fair wholesale prices from retailers.
APAL continues its efforts in the advocacy space shining a light on the immense power held by the supermarkets by supporting the National Farmers’ Federation Horticulture Council and its sector-wide response to ensuring fair prices for growers. The entire horticulture sector of perishable goods is feeling a similar pain to our industry, with the persistent increases in the cost of production and ample domestic fruit supply continuing to squeeze grower margins.
Even so, in the apple and pear industry specifically, growers continue to observe bold replanting strategies, seemingly disregarding this country’s supply and demand realities. While production in Australia continues to grow, particularly in club varieties, retailers are questioning where these fit in their range.
APAL continues to reiterate the same, consistent message – growers need to consider export and look at removing their poorest-performing blocks to drive better value, quality and improved efficiencies. I urge everyone to consider their options for the long-term sustainability of the industry.
Shifting landscapes and industry consolidation
It’s becoming exceedingly clear that pressure is being felt across the industry and, typically, this kind of pressure enforces change. As outlined in the Apple and Pear Industry Strategy in 2018, consolidation was inevitable and necessary for the Australian industry to be sustainable in the long term.
Through mechanisms such as club varieties, informal consolidation and collaboration has progressed over recent years. However, in the last 12 months, we have witnessed more significant, formal consolidation through mergers and acquisitions.
Recently announced, a new strategic partnership between Montague and Ontario Teachers’ Pension Plan and its subsidiary Pomona Valley will see the two entities join forces to deliver long-term sustainable growth.
For more information:
Philip Turnbull
Apple and Pear Australia Ltd
Tel.: +61 03 9329 3511
Email: phil@apal.org.au