A GEM of an avocado
As New Zealand's avocado growers struggle to stay afloat after three years of plummeting Hass prices, a new hero emerges in the form of the GEM™ avocado.
Rival Mexican supply is lower, which has allowed Avanza, the international export brand channel for AVOCO, to start early season negotiations in Japan at significantly improved market prices. While this is partly offset by an unfavourable exchange rate it still reflects a significant improvement in grower OGR (orchard gate returns).
Interest in New Zealand avocados is also proving to be strong in developing markets such as Singapore, Thailand and Malaysia and there are encouraging signs that Avanza sales will resume in Hong Kong after a two-year absence.
Japan recognises New Zealand as a premium supplier during a particular window, September through January, as part of its 12-month sourcing strategy. The first New Zealand shipments arrived at the tail end of September and have now been ripened by local distributors ready for sale.
Ted Thomas, Primor Produce export manager, says Avanza has made a significant change in its distribution arrangements in Japan this season with new focus on distributor Fresh Systems. "Working with Fresh Systems brings together a long-term plan that Avanza have been working on with its business partner Mission Produce based in California. We expect Fresh Systems will handle about 80-90% of Avanza's Japanese supply in year one, with big growth plans beyond this season."
Thomas says it is exciting to be involved with Fresh Systems, which has significant clout in the market. "Fresh Systems shares our focus and has the infrastructure capability to supply high-quality ripe fruit to customers, a key strategy in continuing to grow the avocado category in this important market."
The great start to the export season is good news for AVOCO, the grower group formed this year to present a unified face in export markets. AVOCO, which represents about 75% of New Zealand avocado growers, is now forecasting its sales will top the $50 million mark in all markets this season through to August. Its sales into countries other than Australia are being handled by Avanza, with AVOCO's growers sharing equally in AVOCO's returns from all markets.
AVOCO director Alistair Young says the early season prices have excited growers, but it is important to structure the harvest to maintain a targeted supply.
"We are aware of strong grower pressure to pick more fruit in this early phase of the season, but all the market forecasts show values strengthening strongly in December, January and February. To get ahead of ourselves now will potentially place the strong values we are working towards at risk.
"On the upside, the opening prices in Australia are the best we have seen and the returns will build a good foundation for the grower pool going forward. Careful planning of harvesting will get the most from our growers' crops and allow us to return the best possible result for AVOCO."
Fellow AVOCO director John Carroll says the industry is better placed this season because of the formation of AVOCO, which unites the export marketing efforts of Southern Produce and Primor Produce, the two biggest exporters of avocados. "We are rapt that so many of our suppliers and customers feel connected to what AVOCO has become, after nine months of hard work to set it up.
"Many favourable comments were made about how smart AVOCO looked at the recent Australasian conference in Tauranga, yet it is what lies underneath that matters most – the broad network of committed New Zealand suppliers united behind a strong marketing team to present New Zealand at its best to the world marketplace."
