Export opportunities for Australian vegetable growers
A consumer-targeted marketing approach and more finely honed commercial skills are required for Australia’s $3.6 billion vegetable industry to prosper according to 2014 Nuffield Scholar and Gippsland vegetable producer, Emma Germano. Located in Victoria’s Mirboo North, Ms Germano is the Managing Director of ‘I Love Farms’, a family business supplying cauliflower and potato crops for the Australian eastern seaboard fresh market.
Ms Germano travelled across Europe, the Middle East, North America and the Asia-Pacific as part of her scholarship, supported by Horticulture Innovation Australia, where she examined competitor supply chains and product trends. Her final report provides a range of recommendations on how Australian producers can ‘grow the pie’ by examining the intricacies of overseas production and how to better leverage competitive advantages. Ms Germano said now was the time for growers to move beyond the perceived constraints that accompany the export of fresh produce and to grasp the opportunities that exist for Australian vegetable production.
“Australia’s close proximity to growing, as well as choosier and wealthier markets puts our industry in a really exciting position. But faced with some of the highest costs of production in the world can have its challenges. Grasping these opportunities abroad means addressing several issues on farm, such as labour and transportation costs, and the need to differentiate products to align with changing consumer trends. If we can overcome these challenges, there is real potential to develop and target high-end food segments in global markets with products built on safety, integrity and quality. Underpinning these principles is an effective and targeted marketing approach which understands the nuances of different markets and can supply them accordingly.”
Ms Germano travelled to a range of countries and gained a first-hand insight into the needs and wants of international consumers of fresh food products.
"There is great opportunity in understanding the subtleties of different cultures – producers can gain a lot from visiting these markets and immersing themselves in the culture. Take for instance a punnet of strawberries. It’s considered a summer fruit staple in Australia, but in Japan can be a highly-sought after gift reserved for special occasions, and sold in store for over $A70. The growing demand for value-added products is significant, particularly for lower-grade vegetables too, by creating new portion sizes alongside promotions such as ‘freshly cut’ or ‘ready to eat’ labels. Ultimately, the chance to capitalise on these export markets will only arise once we, as producers, truly understand the market in which we are supplying and marketing to. If collectively we can be more strategic and targeted in the way we produce, package and promote our produce – there’s a much greater chance of seeing international success.”
In addition to a coordinated marketing approach, Ms Germano believes it’s imperative that Australia seeks to establish new trade arrangements, including a reduction in technical barriers, so as to capture export opportunities and mitigate risks.
"There’s been a real push for more international trade in recent years, at both the government and industry level, but there’s always more that could be done. Opening up more opportunities via trade agreements and reducing technical barriers to entry will be necessary for Australia’s vegetable sector to realise its full potential. Industry also has a key role to play particularly in forging and maintaining good business relationships that are based on trust and mutual benefit. Building closer ties with importers helps to mitigate risks associated with global transactions and smooth out supply challenges such as fluctuations with the foreign exchange rate and changes to the operating environment.
Overall, Ms Germano says a long term export strategy must fit into the goals of farm businesses and, more broadly, Australia’s agricultural sector.
“We need to be agile and outward looking. Shifting our thinking away from simply supplying a domestic market to an international one is key, as is our ability to attract investment into agriculture. Improving the financial literacy and business acumen of growers will help to increase on farm productivity and export readiness. This enables growers to build on their business-to-business skills and even develop their own brands to market produce overseas. If we can make these advances at home, then we’re bound to see a bright future abroad.”