Get your house in order: Abbott advises SPC

It seems unlikely that fruit processor SPC Ardmona (SPCA) will receive government aid with prime minister Tony Abbott encouraging the brand to get its house in order.

The manufacturer’s cannery in Victoria’s Goulburn Valley is now seriously threatened, despite an expert panel comprising business figures such as Dick Warburton, Catherine Livingstone and former ALP industry minister Greg Combet advising the government to deliver the $25 million that the company requested.

According to AFR, Coca-Cola Amatil, which owns SPC, said it will provide $150 million if both the federal and the Victorian governments provide $25 million each. As part of a proposed restructure package, Coca-Cola Amatil is believed to have promised investment in new a plant and equipment, as well as new products.

Despite last-ditch efforts by Industry minister Ian McFarlane and Victorian Liberal federal MP Sharon Stone, whose Murray electorate takes in SPCA’s major operations, the majority of the cabinet is believed to be opposed to industry assistance.

Stone has emphasised that SPCA is not after a bailout, but on Tuesday (28 January) Abbott painted a grim picture of the company’s future in Australia.

“It is very important that we take seriously the requests that different organisation may put to us as a government, but in the end businesses have got to put their house in order,” he said.

“That is my advice to any business that might be doing it tough at the moment and thinking of approaching the government.”

 

Aussie table grapes to enter Korean market

Minister for Agriculture, Barnaby Joyce has announced that Australian table grape producers should soon be able to export to the Korean market following the finalisation of associated trade conditions.

Joyce says that the agreement serves as excellent news to the industry which is worth around $82 million annually.

"Other major fruit exporting nations such as New Zealand and South Africa are yet to finalise free trade agreements with Korea,'' Joyce told The Weekly Time Now.

"Australia currently exports more than 60 per cent of our agricultural product and it is essential we are always looking for ways to expand our market opportunities and to increase the return to our producers.”

Jeff Scott, chief executive of the Australian Table Grape Association said that trade could occur as early as next harvest, and that the association expects trade to be worth around $35m over the next three to five years.

"We expect trade to occur later in this coming harvest season once arrangements for the implementation are completed,'' said Scott.

"This gain of market access is great news for the Australian table grape industry as access to the Korean market will help our industry to continue to grow.''

 

National shortage pushes avocado prices to record highs

A national shortage of avocados has pushed the prices of the fruit up to $50 a tray at Melbourne’s wholesale market equating to around $3.80 per piece of fruit in stores.

According to the director of Peninsula Avocados, Steve Marshall, the shortage is due to a bad season in WA coupled with New Zealand exporting to alternative markets, The Weekly Times Now reports.

"I've never seen prices like this, it's just astronomical,'' said Marshall who predicts that the prices could reach anywhere between $5-$8 per piece of fruit.

"It's great news for Victorian growers, who missed out on good prices last year due to a glut caused by Australian over-production and dumping of New Zealand avocados.''

Anna Petrou, communications manager for Avocados Australia echoed Marshall’s comments, stating that the adverse weather conditions experienced by WA, together with a lower supply of NZ fruit has resulted in a smaller supply in the Australian market.

"Though the NZ industry is dominating our market in the summer period their supply is lower than what was expected this season,” said Petrou

"Australian consumers can expect to see the amount of NZ avocados in stores tapering off in February 2014 and after this time Australian grown avocados will again dominate the market,'' she said.

"Australian avocado growers in the two main avocado growing regions that supply fruit in summer – Western Australia and Sunraysia growing regions – have been working to expand their capacity to meet the growing demand for avocados in summer.

"There are significant plantings of avocado trees being undertaken by avocado growers.

"This activity will assist in Australian growers being able to meet strong summer demand in future years.''

 

Coles partners with Perfection Fresh to launch healthy eating campaign

Supermarket giant Coles has launched a new healthy eating campaign in conjunction with one of Australia’s best known marketers for fresh fruit and vegetables, Perfection Fresh.  

The campaign which is inclusive of the new Hatters Vegetables brand is designed to encourage the consumption of fresh fruit and vegetables through the use of an interactive website and the use of a quirky cartoon vegetable expert named Livingstone R. Rabbit, who educates on the importance of seasonal vegetables and offers tasty recipes.

The move has been welcomed by the Produce Marketing Association Australia and New Zealand, with Michael Worthington, CEO of PMA Australia-New Zealand stating that the campaign will undoubtedly encourage the public to consume more fresh produce.

 “Now more than ever the fresh produce industry needs to apply clever marketing and promotional measures to encourage Australian consumers to eat their recommended daily intake of fresh fruits and vegetables,” said Worthington.

“With increased touch points available to consumers across a range of mediums, innovation in how retailers communicate with shoppers is a welcome and positive move that can only mean good things for the industry.”

Worthing says that the campaign has the capacity to change of eating habits of the public and pave the way for a healthier community.

“It’s fantastic to see two PMA A-NZ members, Coles and Perfection Fresh, involved in a pioneering move that will pave the way for growers, distributers and retailers in the future,” said Worthington.

 

Abbott announces fruit and vegetable FTA with Korea

The Federal Government has announced a free trade agreement with Korea which will see the elimination of tariffs on potatoes, carrots, tomatoes and a number of other horticultural products.

Prime Minister Tony Abbott made the announcement in Parliament yesterday afternoon, stating that Korea was Australia’s third-largest goods export market and would be worth “$5 billion between 2015 and 2030, and boost the economy by around $650 million annually after 15 years."

The announcement has served as welcomed news to potato growers around the country as they will be able to access the Korean market also immediately without the restriction of tariffs.

AUSVEG, the peak industry body representing Australia’s 9,000 vegetable and potato growers states that $7.4m of vegetables including $6.3m of potatoes were exported to Korea in 2012-13, figures which the group expects to increase dramatically as a result of the FTA.

“Potatoes will see an immediate elimination of tariffs into Korea, which means that growers will be able to reap the benefits of the new agreement in the early months of 2014,” said AUSVEG spokesperson, Hugh Gurney.

“The establishment of a free trade agreement with Korea is a momentous outcome for the Australian horticulture industry and will create new opportunities for Australian growers to supply first-class produce to Korea’s citizens,” he said.

In addition, the new FTA will also include cherries, dried grapes, fruit and vegetable juice, apricots, mangoes, peaches and plums – providing valuable opportunities for Australian growers to access the key Asian market.

“With our proximity to the region and capacity to supply Asia with fresh and safe produce, this announcement could not have come at a better time for Australian growers,” said Gurney.

The FTA will now enter a legal verification process and must be approved by Cabinet in both countries. It will then be signed off in a formal ceremony and come into effect around the middle of 2014.

 

Mutti launches new pasta bar at Salt Meats Cheese

Premium Italian tomato brand, Mutti together with gourmet retail outlet, Salt Meats Cheese have joined forces to serve traditional Italian fare to Sydneysiders at the soon to be completed, Salt Meats Cheese Mutti Pasta Bar.

Located inside the Salt Meats Cheese store in Alexandria, the innovative new pasta bar will utilise the Mutti range of gourmet tomato products together with freshly made pasta to create a range of authentic Italian dishes.

To celebrate the launch of the pasta bar which was held last night, Francesco Mutti, the fourth generation family business owner of the company, flew over from Italy to share his passion for Italian food and celebrate the brand’s success in Australia.

“Tomatoes are an integral part of Italian cuisine,” said Mutti. “From pasta to pizza, it is really one of the core pillars of our cuisine.”

Mutti produces eight products in total including passata, pizza sauce, inventa sugo, tomato paste and four varieties of tinned tomatoes. By producing only a small number of products, Mutti says that the family run business has been able to perfect its recipes.

“At Mutti we work only on tomatoes because it takes time to learn about the product, it takes time to perfect a product,” said Mutti.

“Italian food is very simple. It consists of only a few simple elements, and those elements have to be dramatically good. You cannot make something good with an average ingredient.”

Mutti was joined by iconic Sydney chef, Massimo Mele of Hugo’s fame who created a menu of canapés for the evening including woodfired margherita pizza, puttanesca pasta and a host of other tomato based delights.

The Salt Meats Cheese Mutti Pasta Bar will be officially opened in early 2014.

 

Karen Martini showcases Australian grown SPC products

As Australia’s largest remaining fruit and vegetable processor, SPC Ardmona is taking on new and innovative ways to remind Aussie’s of the importance of choosing high quality, locally grown products.

As part of the Victorian processor’s new 100 percent Australian grown and Australian made campaign, SPC is encouraging consumers to rediscover the versatility of its products with the help of chef, restaurateur and author Karen Martini.

Martini showcased unique and innovative ways to incorporate the range of SPC Ardmona’s staple products such as baked beans and tinned tomatoes into hearty, delicious meals at a media event at the Sydney Cooking School last week.

Growing up not too far from SPC’s Shepparton plant, Martini said that she has always been a strong supporter of Goulburn Valley produce and the SPC brand.

“I have strong childhood memories of SPC Ardmona brands and continue to use these products today when cooking for my family. I’m a huge supporter of Australian grown and Australian made produce and have always found these brands to be a reliable and trusted choice for a large variety of dishes,” said Martini.

The dishes Martini created for the event included smokey baked beans with chorizo and prawns, Turkish inspired chicken with apricots, ginger, saffron and pistachios and a free-form apple, pear and cinnamon pie.

Bronwyn Powell, SPC Ardmona’s marketing and innovation director said that despite experiencing some challenges recently from cheap imported products, the company is determined to support the local industry and continue to drive its key message of 100 percent Australian grown and made.

“We support more than 2,700 jobs in the Goulburn Valley region and our impact on the local economy equates to $165 million,” said Powell.

“SPC Ardmona has been experiencing tough times recently, but we have not been deterred and have worked hard at combating these issues. We believe the quality of locally grown produce, like the tomatoes used in Ardmona, means that Aussies shouldn’t need to look to imported products to create great food.”

Powell admits that country of origin claims are still a major issue for SPC Ardmona as many consumers often do not realise that products they have purchased are either imported, or made partially from imported ingredients.

“Often people do not realise that a product they have purchased is not grown or made in Australia. It’s really important for Australian growers and manufacturers to highlight their provenance on product packaging to avoid confusion and help shoppers make an informed decision on what they feed their family.

“Together we can help champion Australian grown and Australian made produce, support manufacturing jobs in Australia, keep farmers on the land and ensure that Australian families continue to get high quality Aussie produce.”

 

Anti-Dumping Commission approves tariff on imported tomatoes

The Anti-Dumping Commissioner has decided to enforce a nine percent tariff on imported tinned tomatoes, despite the Productivity Commission rejected an application for safeguards just weeks ago.

The Commissioner found that imported goods have cause material injury to local producers, and in a preliminary decision, have found in favour of the application by SPC Ardmona of alleged dumping of prepared tomato products exported to Australia from Italy.

SPCA has also applied to the Anti-Dumping Commission to look into alleged dumping of peaches.

The finding means that tariffs of around nine percent will be placed on 14 Italian processed tomato brands, effective immediately.

Managing director at SPC Ardmona, Peter Kelly, described the decision as a positive step forward for the brand and for Australian tomato growers.

"We have been challenging the unfair market resulting from tough economic conditions over the past five years," he said

"This [decision] has boosted our confidence in the Anti-Dumping Commission process and we’re looking forward to a favourable decision on our full submission."

The full anti-dumping report into tomatoes will be finalised in January 2014 at which time the Minister for Industry will determine the level of measures (tariffs) that may continue.

Paul Bastian, national secretary of the Australian Manufacturing Workers' Union (AMWU) also welcomed the decision as one made in the interest of local manufacturing and jobs.

"We have 1,500 people employed at SPCA in the Goulburn Valley with the whole operation supporting about 2,700 jobs when you add in growers, logistics and other knock-on services," he said

"The dumping of cheap tomatoes and fruit in this country from other nations has threatened SPCA’s ongoing viability and the AMWU has supported their efforts to get the government to act."

The decision comes just weeks after accelerated reports compiled by the Productivity Commission found that emergency safeguard measures against cheap imported processed fruit and tomato products are not warranted.

The Commission's full report on the application for safeguards is expected at the end of the year.

"This correct decision by the Anti-Dumping Commission brings into question what the Productivity Commission was doing in its interim decision when it found that while the industry was suffering serious injury it would not impose WTO sanctioned safeguards," Bastian said.

"This leaves in serious doubt whether the Productivity Commission is prepared to make decisions based on facts, on the real pressures and unfair trade practices confronting our industry and in the interest of our people or whether it is purely ideology that guides their deliberations."

 

SPC Ardmona offers aid to the Philippines

Victorian based cannery, SPC Ardmona has offered to supply canned food to victims of Typhoon Haiyan in the Philippines.

SPCA contacted the federal member for Murray, Sharman Stone, stating that the company is prepared to supply canned food at cost price, and should the government be prepared to purchase a significant amount, SPCA will donate an additional $250,000 worth of product to victims of the Typhoon.

SPCA has asked Stone to propose its offer to the Foreign Minister, Julie Bishop, The Weekly Times Now reports.

“We have canned food in storage that is ready to go if our Federal Government is prepared to distribute this food as part of their aid package,'' said SPCA’s managing director, Peter Kelly.

"We've spoken previously about providing food as foreign aid instead of cash.

"For the benefit of people in the Philippines, I urge the Government to take this opportunity to put this initiative into action.

"Our employees stand ready to have our products prepared for shipping within 48 hours if the Government wishes to accept our offer to assist.''

 

Campbell Arnott’s donates more than 160,000 cans of soup to Foodbank

Australia's largest food relief organisation, Foodbank, has received more than 160,000 cans of soup – equivalent to around 300,000 serves of vegetables – from Campbell Arnott's.

The collection of vegetables soups was unlabelled, so label company Labelmakers and packaging firm, Amcor, as well as a number of Foodbank volunteers in the Victorian warehouse, provided the packages with a simple label and packed them into cartons.

The cans will now be disseminated to food relief agencies in metropolitan, regional and remote areas to help feed the less fortunate.

Foodbank CEO, John Webster, said "Foodbank currently provides food for close to 500,000 people a month but we know from our recent survey, the End Hunger Report, that there are still more than 65,000 people being turned away from charities empty handed due to lack of supplies. This donation of a nutritious meal in a can will certainly help us to bridge that gap."

"Campbell Arnott’s are great supporters of Foodbank’s work and we’re proud to be in a position to play a part in helping to eliminate hunger. We believe soup is the perfect donation as it is wholesome, nutritious and filling," said Anne Ricci, marketing director at Campbell’s.

Earlier this year, Campbell’s donated 15,000 bottles of V8 juice, representing 225,000 serves of vegetables, to Foodbank to mark the official opening of its $14.6 million PET line at its Shepparton facility in Victoria.

Multinational packing and processing company, Tetra Pak has also recently donated to Foodbank, handing over a ride-on floor sweeper to the warehouse in Wetherill Park, NSW.

Tetra Pak, in partnership with Murray Goulburn and the Australian government, also provides an annual donation of 600,000 litres of long life milk to Foodbank.

 

Hydroponic tomato operation to create 90 jobs in VIC

The construction of a new $12m hydroponic tomato growing operation in Katunga Victoria is expected to create 90 new jobs.

The new Flavourwave business venture facility has been backed by the state government who has contributed a grant of $500,000 to the development of the project, The Weekly Times Now reports.

The venture is the result of a partnership between existing businesses and investors within the hydroponic vegetable industry including the likes of Katunga Fresh and Victoria’s largest hydroponic tomato business, Flavorite.

The facility will be using state of the art technology to provide a completely controlled environment for growing plants, and any runoff water will be analysed for nutrient levels to ensure the health of the plants.

Victoria’s deputy premier, Peter Ryan said that the project will be delivered with two stages over a five year period.

Stage one will involve a $6m investment including a 5.3 hectare state of the art glasshouse, packing shed and office facilities. The second stage will include an additional 5.3 hectare glasshouse and additional equipment.

 

Simplot’s Devonport plant to remain open subject to review

Vegetable processor Simplot has announced that its Tasmanian Devonport plant will remain in operation for at least another three years to fulfil its contracts with both Coles and Woolworths.

The company did however state that the plant will need to make significant savings or it will potentially face closure by 2019, and that the processor’s casual workforce will experience significant job cuts, The Mercury Reports.

The Tasmanian state government granted Simplot $500,000 this morning for capital upgrades and in addition, the company’s managing director, Terry O’Brien will be meeting with new primary minister Ian McFarlane to discuss a further $18m in funding that was promised by the Rudd government.

Andrew Craigie, vegetable council chairman for the Tasmanian Farmers and Graziers Association said that although three years was a reasonable timeframe, a five year term would have been preferable as it would have given growers more confidence to invest in more efficient technology.

"But by no means will discussions with Simplot drop off," said Craigie.

"The best analogy I can come up with is that we have been told we have a terminal disease but there is a treatment.

"That treatment could kill — but if we refuse, we could also be goners."

Simplot announced earlier this year that two of its plants, Devonport and Bathurst, were under threat of closure due to a very competitive industry and unsustainably high costs.

 

SPC Ardmona warns of closure without government grant

SPC Ardmona, the nation’s last remaining fruit processor says that it may be forced to close if the Abbott government refuses to come through with a $25m grant promised by the former Labor government.

The funding was meant to be sourced from a clean technology programme, which the Liberal government has since pledged to scrap as it was funded by the carbon tax, The Guardian reports.

Peter Kelly, chief executive of SPC Ardmona said that the company ‘does not have a viable future’ without the grant.

“The situation is urgent. We had a productive meeting with minister Macfarlane (the new industry minister) but we need an answer fast. We understand this is a new government and we need to show some patience, but the board has been holding off on a decision for some time,” Kelly told The Guardian.

"I can't see a viable way for SPC to keep operating in the future if we don't invest this money. I can't say it any clearer than that."

Local liberal MP, Sharman Stone agrees that the funding is urgently needed and is lobbying for a fast decision.

“I accept the minister is going as fast as he can. But SPC Ardmona is the last remaining fruit manufacturer in Australia. We know there is a demand for Australian product but in the current conditions, with the dollar this high and imports this cheap, they can’t compete,” she said.

“Without this grant it will probably be impossible for them to continue … thousands of jobs would be lost, thousands of hectares of fruit trees would be bulldozed and a regional economy would be destroyed.”

SPC Ardmona has secured various deals with Australian retailers in the recent months including a $7m deal with Woolworths which will see the supermarket giant replace imported fruit with locally grown for its Woolworths Select range. However SPC says that these new deals are not enough to sustain the business in the long-term.

SPC Ardmona is also calling upon the federal and state governments to support local food processors and farmers by encouraging public institutions including gaols, hospitals and army barracks to purchase locally processed food.

 

Zespri kiwifruit company faces fraud investigation

New Zealand kiwifruit company, Zespri is currently being investigated by the Serious Fraud Office (SFO) after the company’s Chinese subsidiary was fined almost $1m, leading to the incarceration of an employee for five years.

The offenses relate to the underpayment of custom duties on kiwifruit imports that occurred between 2008 and 2010 which were a result of a ‘dual invoice’ system for kiwifruit shipments. The system involved issuing one invoice that reflected the true value of the fruit, and second invoice reflecting a lesser amount for custom purposes, Stuff.co.nz reports.

Zespri has stated that dual invoicing was common practice in the fruit industry and that the company was not acting illegally by engaging in it, however the company has since switched to a fixed price arrangement.

The SFO confirmed yesterday that an investigation into the Zespri Group has been launched, however the company stated that it was not yet aware of the investigation.

A spokesperson for the company stated:"Zespri has not been contacted by the SFO and has no details of the scope or substance of an investigation. Zespri will co-operate with any investigation.”

President of the Kiwifruit Growers Association Neil Trebilco said that the association was conducting its own review of the matter, but was surprised to learn of SFO’s involvement.

"I'm surprised the SFO are doing such an inquiry because I haven't seen anything to suggest they should have done something like that," said Trebilco.

“The real concern is that people might say well Zespri must be guilty of something here if the SFO are looking into it and I'd say that's not necessarily the case at all".

 

Simplot to announce fate of Devonport plant this week

Food processor Simplot is expected to announce if its Tasmanian Devonport plant will remain open later this week.

Should the decision the made to close the plant, it would affect approximately 300 factory employees and 130 farmers that supply produce, The Mercury reports.

In June this year, Simplot announced that two of its plants; Devonport in Tasmania and its Bathurst plant in NSW were under threat of closure due to rising operational costs, the strong Australian dollar and a highly competitive industry.

Since the announcement, the nation’s two Supermarket giants, Coles and Woolworths both struck deals with the processor that would see their frozen vegetable private label brands converted to 100 percent Australian grown produce.

Both deals serve as positive news for the vegetable processor however Simplot’s managing director, Terry O’Brien said last week that jobs cuts will still be required in order to reduce costs.

"We don't think buying (frozen vegetables) from us just because we are Australian grown is sustainable for Woolworths — or any buyer — in the long term; we want them to want our product because it is financially attractive too," said O'Brien.

"To do that we have to bring down the costs of processing at Devonport; and the only way we can do that will involve new machinery, new processing methods and significantly less labour."

If a decision is made to close the Devonport plant, operations will stop within three to five years.

 

An advancing Australia is not so fair: why Aussie food manufacturers are doing it tough

You'd be hard pressed to come across a topic in the Australian food manufacturing sector that generates as much passionate discussion as how to best support Australian brands using Australian ingredients.

A high Australian dollar – despite easing recently – coupled with an influx of cheap imported products, a decline in export markets and ambiguous country of origin labelling legislation have all impacted on the profitability of local businesses.

2013 has been a particularly challenging year. Unable to compete with cheap imported products, SPC Ardmona was forced to cut 61 fruit growers’ contracts, and was then denied provisional safeguard tariffs against cheap imported tomato and fruit products as part of the Productivity Commission’s accelerated report.

Food processor Simplot announced that two of its plants were under threat of closure due to a highly competitive industry and unsustainably high costs, and Gourmet Food Holdings, which owned iconic brand Rosella, was placed into receivership.

South Australia’s Spring Gully also entered voluntary administration earlier this year with debt of more than $3 million, only to be saved – largely – by a wave of local consumer support.

So what needs to be done in order to save our local food processors and iconic brands? And what’s stopping them from sourcing Australian inputs?

Made in Australia? Or from local and imported ingredients?

In August this year, the Australian Made campaign‘s chief executive, Ian Harrison, called for a strategic partnership between the government and Australian Made to develop a plan to reduce consumer confusion surrounding country of origin labelling.

The ambiguous term ‘Made in Australia from local and imported ingredients’ does not distinguish between ingredients and packaging and has been a long-standing matter of contention within the industry and amongst consumers.

According to the Australian Competition and Consumer Commission (ACCC), the ‘Made in’ claim means that the product was made (not just packed) in the country stated, and that at least 50 percent of the cost to produce the product was incurred in that country. Products that use the ‘Made in’ claim may also contain ingredients from other countries – hence a product with a ‘Made in Australia’ label won’t necessarily contain Australian ingredients.

The ‘Made in Australia from local and imported ingredients’ claim can also be confusing as it doesn’t communicate to the consumer what proportion of the ingredients are local, and what’s imported.

“'Made from imported and local’, or ‘Made from local and imported’ – depending on the order in which the two words are placed, is supposed to infer  whether the majority of the product is imported, or whether the majority of the product is local,” Harrison told Food magazine. “But the public doesn’t understand that.”

Australian Made’s iconic green and gold kangaroo logo has been used by thousands of businesses for nearly three decades to identify genuine Australian products and produce in Australia and overseas. Harrison says that the logo serves as a powerful marketing tool for those companies that meet Australian Made’s strict ‘made in’ test.

“Being Australian is a decided advantage – you will get a premium for your product, particularly if it is dairy-related at the moment. And that premium is justified because Australia has a reputation for high product standards, high safety standards, and it reflects our clean green environment,” says Harrison.

"In an environment where increased costs and a high Australian dollar have seriously undermined the competitiveness of many Australian products, country of origin is an asset we should be driving much, much harder."

Cheap imported ingredients come at a cost to Aussie producers

Country of origin labelling is just one of the many factors that is affecting the livelihood of the Australian food manufacturing industry. Australia, even without the high Australian dollar, is still an expensive place to do business.

Australia’s wage structures are amongst the highest in the world, industrial arrangements are quite inflexible and government-related charges coupled with high power costs seem to be increasing year on year.

One manufacturer whose struggles have been highly publicised is SPC Ardmona.

The company, which makes a commitment to sourcing a significant percentage of its ingredients from Australia, was forced to cut 61 growers’ contracts from Victoria’s Goulburn Valley region – home to SPC Ardmona’s iconic Goulburn Valley Fruit brand – in April this year.

The company, which is the largest remaining fruit and vegetable processor in Australia, said that the decision was not made lightly, and was a direct result of a huge rise in the Australian dollar that fuelled imports to record levels. The low cost imports were favoured by major supermarket chains as it enabled them to take advantage of the exchange rate appreciation and import products at an extremely low cost.

In an attempt to tackle the issue, SPC Ardmona applied for temporary safeguard tariffs of at least 30 percent for retail canned tomatoes and 45 percent for multi-serve fruit products for 200 days, consistent with the World Trade Organisation (WTO) Safeguards Agreement.

However in late September, findings in the Productivity Commission’s Accelerated Report indicated that provisional safeguards were not warranted, and as such, the application was denied.

“This is extremely disappointing for SPCA, growers and the Goulburn Valley region. We disagree with the Commission’s conclusion in the reports. We have provided compelling evidence that in these circumstances the immediate provision of safeguards should be applied,” said managing director SPC Ardmona, Peter Kelly.

Although the Productivity Commission’s full report is not expected to be finalised until 20 December, Kelly said that the findings “further delay action at a critical stage in our business and seasonal cycle and perpetuates uncertainty in the region.”

Some positive news for the food processor was the recent announcement of a $7 million deal with retail giant Woolworths. Under the new deal, Woolworths will source 13 lines of canned fruit from Goulburn Valley growers for its private label ‘Select’ lines, which were previously imported from South Africa and Thailand.

The power of the consumer

Even if SPCA was to secure emergency safeguards, the reality is that wholly Australian-made products have a tendency to attract a higher price tag than their imported counterparts. So how do you communicate to consumers the importance of choosing a locally-made product over an imported one?

Peak industry body for the South Australian food industry, Food SA, has launched a number of successful campaigns including ‘Eat Local’ which saw a selection of restaurants and cafes showcase the state’s high quality produce by either including a dish that was made from local ingredients, or selling local produce in-store.

Another was the Shop & Swap initiative launched by Robern Menz – South Australia’s largest confectioner, and endorsed by Food SA.

The Shop & Swap campaign was launched on the back of unprecedented public support for South Australian pickle and sauce manufacturer, Spring Gully, which was on the verge of receivership until a sudden wave of both retail and consumer support saw sales soar.

Spring Gully experienced three weeks’ worth of sales within a three day period shortly after Shop & Swap was launched, resulting in Foodland, IGA and Coles supermarkets placing extra orders to keep up with demand. The Shop & Swap campaign encourages consumers to simply swap one item for a locally-made product every time they shop. The campaign is intended to help shoppers recognise locally-owned brands so that they can make informed purchasing decisions that support and strengthen local businesses.

Catherine Barnett, CEO of Food SA, said that the initiative serves as a powerful vehicle that has the capacity to influence the shopping habits of many South Australians.

“It is critical that people understand what they are buying. We would like consumers to think about buying and consuming South Australian-made and owned high quality products. There are many ways consumers can make this change,” she said.

Government support – food manufacturers need more of it

As we have seen with the revival of Spring Gully, consumer support can do a great deal to sustain local industry. But what the industry really needs to foster and secure a sustainable and profitable future is sufficient government support and investment, especially if the nation is to become Asia’s food bowl, as some reports have suggested.

A recent industry roundtable involving executives from NAB, Nestle and SMS Management reinforced this sentiment.

The executives were asked to identify sectors of the Australian economy with the best potential for future economic growth and the consensus was clear: the nation needs to capitalise on its reputation for clean and green food production, otherwise known as “Brand Australia.”

The executives contended that Australia needs to focus on producing and exporting high quality finished products to best capitalise on Asia’s growing middle class, rather than sending over raw materials such as wheat and milk.

"There's almost no new investment in food production, in food manufacture and, in fact, if you look at what's happening in the Goulburn Valley, fruit is rotting on the ground because of closures of factories,” Elizabeth Proust, chair of Nestle Australia, said at the roundtable.

"I'd be very cautious about seeing us as an exporter of raw materials, so to speak, rather than somebody who can be really smart and clever, and find ways of really making export dollars by exporting the final or the almost final product."

Proust’s view is echoed by many other key players in the industry. The notion of focusing on quality over quantity and then exporting that final product is exactly what a number of boutique food producers and winemakers are currently doing.

A prime example is the Barossa Valley Trustmark which was launched by SA Food Minister Gail Gago in September. The trust mark was created by Paul Henry of Winehero and is designed to encompass the region’s commitment to consistent, high quality products and provide a platform to firmly establish the Barossa brand on the world stage.

The reality is that Australia is blessed with a beautiful clean and green environment, and from that, we produce some of the best food and wine in the world. All we need to do, is invest in it.

 

Woolworths to source Aussie frozen vegetables for private label products

Woolworths has announced as $17m plan that will see the retailer cease importing frozen vegetables for its private label products in favour of supporting local industry.

The move will see the supermarket giant commit to purchasing an additional 5100 tonnes of frozen vegetables from Simplot’s Devonport plant in Tasmania, replacing imports from China, Europe and New Zealand, The Australian reports.

Earlier this year Simplot announced that the influx of cheap imports coupled with consistently high operating costs could result in the closure of its Devonport and Bathurst Plants, affecting hundreds of jobs in both Tasmanian and NSW.

Simplot’s managing director, Terry O’Brien said that although the deal with Woolworths serves as welcome news, the company will still be forced to announce job cuts at its Devonport plant next week to reduce costs.

"We don't think buying (frozen vegetables) from us just because we are Australian grown is sustainable for Woolworths — or any buyer — in the long term; we want them to want our product because it is financially attractive too," Mr O'Brien said.

"To do that we have to bring down the costs of processing at Devonport; and the only way we can do that will involve new machinery, new processing methods and significantly less labour."

Tjeerd Jegan, managing director of Woolworths, said that the supermarkets decision to switch back to Australian grown frozen vegetables was driven by consumer demand for locally grown food.

"Our customers are passionate about great Aussie-grown food, and so are we,” said Jegen.

Woolworths’ decision mirrors a similar commitment announced by rival supermarket chain Coles last month. Coles announced that it will commit to increasing its Coles-branded frozen vegetable and potato volume by over 12 percent – making Coles’ Smart Buy frozen vegetable and potato products 100 percent Australian grown by next year.

 

Peak stonefruit body urges Aussies to choose locally grown over US imports

Peak industry body, Summerfruits Australia, has urged shoppers to check the country of origin of their fruit, as imported nectarines and peaches are expected to be on shelves when the Australian season begins.

The Fresh Produce Group (FPG) announced that they had secured the rights to import USA grown stone fruit into Australia in July this year following a 20 year ban. FPG said that move gave Australian consumers the opportunity to purchase peaches and nectarines in the winter period when they are traditionally unavailable locally due to seasonality.

Pakistani mangoes were also given space on Australian shelves following approval from the Australian Department of Agriculture, Forestry and Fisheries (DAFF).

Chairman of Summerfruits Australia, Andrew Finlay, said that consumers need to get behind local industry by purchasing locally grown fruit now that the season is commencing.

 “It’s important for grocery buyers to know imported stonefruit will still be on shelves when our local season begins in October,” said Finlay.

“Support our growers and help save our industry by double checking country-of-origin food labels and make sure what you take home is Australian made,” he said.

The first trays of stonefruit will come from sub-tropical Queensland, followed by Northern areas of Western Australia and New South Wales, then moving through to Victoria, South Australia and Tasmania. 

 

McCain Foods announces closure of SA potato plant and job losses

McCain Foods has announced that 59 jobs will be lost following the closure of its South Australian Penola potato processing plant.

Louis Wolthers, McCain Foods regional president for Australia/ New Zealand and South Africa said that the decision was made due to unsustainably high input costs coupled with surplus capacity, ABC News reports.

“Australia has one of the highest raw material costs in the world, which is unsustainable in the long term," said Wolthers.

"Cheaper potato imports are seriously threatening the future of the processing industry in Australia, and will place further cost pressures on Australia's growers".

Wolthers said that cheap imports of processed potatoes have risen from 10,000 tonnes to 130000 tonnes within the ten year period between 2002 and 2012.

McCain have said that 59 permanent employees will be offered redundancy packages together with counseling and support.

Peter Gandolfi, Wattle Range Mayor said that the closure of the plant is upsetting both for the local community and for the nation as a whole.

“I think it's further evidence that as a nation, manufacturing is becoming more and more uncompetitive," he said.

"It's pretty sad when we can't compete when it comes to growing our food."

 

Banana trees to be destroyed in NT to ward off fungal disease

A fungal disease which was found in the Cavendish banana variety in August has become a catalyst to the destruction of banana trees across the Northern Territory.

A $2.8m plan to control the fungus which is known banana freckle, will be undertaken in an effort to protect the spread of the disease to Queensland where 90 percent of the country’s bananas are grown, ABC Rural reports.

Australian Banana Growers Council representative, Doug Phillips said that the disease would cause significant damage to the industry.

"It's certainly a significant disease we don't want," said Phillips.

"Where properties in the Northern Territory have had this disease confirmed, all banana trees as well as trees within a one-kilometre radius will be destroyed as part of this eradication program."

Although the disease has not been confirmed in Queensland Cavendish varieties, Phillips said that the cost to the industry would be huge should the fungus cross the boarder.

"The cost to industry over a long term period could be very, very significant through loss of production and costs trying to control the disease."

Both the state and federal governments, together with industry will be working to control the disease, with the Queensland government funding $125,000 towards the program.

In addition, the Queensland government has strengthened legislation that already prevents banana plants and soil from coming into the state.