Australia’s largest fruit and vegetable processing company SPC Ardmona (SPCA), which is owned by Coca-Cola Amatil, is looking to move some of its food operations overseas.
With three Goulburn Valley (Victoria) processing plants, the largest being located at Shepparton, SPCA employs more than 3000 workers across the region – job losses would severely affect the local economy.
During the company’s recent annual meeting, CCA Managing Durector, Mr Terry Davis, said that a combination of trading conditions, competition from imported private label products and the high Australian dollar had been creating poor export conditions for SPCA.
In 2005 when CCA took over SPC Ardmona in a $500 million deal, the Australian dollar had been trading at about US65c, last week it hit $1.10.
This 31 year high means Australian food is becoming more expensive and imported food cheaper.
“The current strength of the dollar has severely limited the potential for SPC Ardmona’s export business," Mr. Davis said.
"Trading conditions continue to be difficult due to the high level of competition from cheaper imported and private label products."
Previously SPCA was exporting about 20 per cent of its total production; this has since dropped to 10 per cent and is still falling. This has led to CCA reducing much of its export markets for packaged fruit.
"I believe that, ultimately, the Australian consumer will have to make a choice to support domestically produced brands or support imported private label products, which will come at the expense of Australian farmers and fruit and vegetable growers, and then in turn Australian food manufacturers," Davis says.
James Cornish, the President of the Victorian Peach and Apricot Growers Association, told ABC Rural news that there are a lot of unknowns with SPC Ardmona’s announcement.
"There are mixed messages. Some weeks ago, we were getting things reasonably positive, I thought," he said.
"Certainly, it is very serious from my point of view because I am very committed to the processing industry.
"I think we have to wait and see what the outcome is."
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