New Zealand’s avocado exporters say the Australian market is hungry for NZ fruit this coming season due to a below-par domestic season, and this could take some pressure off freight woes of getting Kiwi avocados to Asia.
But there is one threat lurking – whether Chile will export avocados to Australia this season after being granted market access provided they meet biosecurity import conditions.
New Zealand Avocado CEO Jen Scoular says this year NZ’s industry is forecasting a 10 per cent increase in total fruit volume. “Overall, we’re expecting more avocados will be available in NZ and for export this season.
“That’s because we’re increasing productivity but we’re also getting more volume from these new orchards that have been developed during last five years.”
Between 75-80 per cent of NZ’s export volume of avocados goes to Australia. “We know domestic supply is Australia is down this year because of extreme weather conditions they’ve had over there.
“So we’re feeling reasonably confident about demand for NZ avocados in the Australian market this coming season – even taking into account that Chilean fruit is now able to be imported into Australia.”
Jen says Chile does have a similar avocado growing season to NZ “so it would definitely be a competitor to NZ avocados in the Australian market”. “But Chilean avocados will have to come along way [to get to Australia] – the ships may even have to come via NZ.
“Also Chile has been strongly been impacted by Covid-19, and they’ve also had weather events, so it’s possibly a challenging time for Chile to be looking to export into an entirely new market.”
Avoco communications manager Steve Trickett says while Chile has been granted access to Australia, it still has technical requirements to tick off before it can export fruit there for this upcoming season.
“We don’t see that Chile will export large quantities of fruit to Australia this season. It will most likely send a small consignment to test the market.
“What we do know is Chileans predominantly grow small-sized fruit and demand is mostly for medium-to-large sized fruit in Australian markets.
“So we don’t expect Chile to get too much attention from supermarket chains but they may gain some interest at wholesale level.”
Steve says NZ can’t rule out Chile as a direct threat to the Australian market in future but he doesn’t see the South American country making Australia one of its main priorities just yet.
Chilean fruit will travel by sea to Australia – a much longer trip compared to NZ exports in terms of quality factors of fruit.
“There’s probably some opportunity to see a bit of fruit volume from Chile in Australia, but we’d expect it to initially be in small quantities – we don’t expect to it to hugely impact our programme for Australia.”
And with forecasts of an increase in NZ’s total crop, Steve says more Kiwi avocados will end up in Australia – with demand for it already there. “In this current market, having come through Covid-19 there are still many countries in different lifecycles of their progress with Covid-19 with restrictions on business and people’s movement.
“But we’re very fortunate this year that the Australian market has got its mouth wide open for an increased volume of fruit this coming year from NZ. This is on the back of Western Australia and other Australian avocado growing regions being well down on volumes.
“While we’re not being silly around pricing expectations, because Australia is a bit like NZ in that it will likely have pretty significant economic impacts due to Covid-19 that could flow onto changed consumption patterns, from a general demand perspective the avocado within the fruit bowl of Australia is a pretty important item.
“At Avoco, we are certainly enjoying an increase in retail orders already in the book from the major retailers we work with.
“And we’d never normally have these orders so early. They were coming to us as early as February and March, usually it’s June-July before we finalise supply programmes for such volumes.
“But this year, like us, they were identifying there was going to be significant domestic crop reduction and clearly they needed to firm up commitments.”
Darling Group’s general manager of sales and marketing, Jacob Darling says while Chile may begin exporting to Australia in earnest, in future they will be a direct competitor to NZ fruit.
“It will be a massive challenge going forward to compete with a price-point [from Chile] that historically on international standards has been a lot cheaper than NZ fruit.”
Jacob says despite Chilean fruit coming a long way to get to Australia, really it’s only 21 days into Sydney from Chile. “Yes, they do have a long transit time – and it is more difficult for them to get fruit to the market – but the reality is they will be there [in Australia] and it will be a challenge for us.”
Jen says the NZ avocado industry’s strength is Kiwi exporters have created very good relationships in the Australian market. “And that collectively between the Australian and NZ industry, there has been a lot of promotion of the amazing health and versatility of avocados in the Australian market.
“So I think it’s a very strong market for us. And if there are supply chain challenges globally, for us – being just across the Tasman – then that is good news too.”