Seeka’s commitment to innovation drives top avocado returns

Seeka’s commitment to innovation drives top avocado returns

Tauranga, June 16 - Seeka will harvest all of next season’s crop for its avocado growers using the new efficient blue plastic bins it has been introducing as part of its commitment to innovation, says Chief Executive Michael Franks.

Seeka currently has 6,000 of the bins in service and will be doubling the number this year. The Surestore bins were built by TCI New Zealand, with development and design strongly influenced by Seeka’s operational experience. The Surestore bins are stronger, safer to handle, easier to clean than wood, and are lighter, allowing more fruit to be loaded onto a truck. Importantly, they are also less damaging to the fruit and have helped improve the quality of harvested fruit.

“Seeka has secured the top avocado returns in the industry for two successive seasons by building a brand with a reputation for quality, which benefits all New Zealand growers,” said Mr Franks.

Based on publicly reported returns from the leading exporters, Seeka has outperformed the industry in both of the past two seasons. Seeka’s avocado growers have been paid out an average orchard gate return (OGR) of $16.64 per export tray for 2014/15.

SeekaFresh Manager Annmarie Lee said Seeka’s aim was to ensure sustainable and profitable OGR for its growers and support the New Zealand industry’s growth.

“We are fully vertically integrated from orchard to market, which means we have excellent communication channels throughout the supply chain to ensure we manage our harvest to maximise pricing in the market,” she said.

NZX-listed Seeka, a leading post-harvest company and New Zealand’s biggest kiwifruit grower, has for several years been diversifying its fresh produce base, including developing the Kiwiberry market. The company is a significant avocado grower, with managed and leased avocado orchards, and major packhouses in the Bay of Plenty and in Kerikeri.

A key reason for the company’s avocado success has been the established strength of the SeekaFresh brand in Australia, the most important export market for avocados. Avocado Manager Dr Jonathan Dixon said Seeka had opted to focus on the Australian market for the 2014-15 season, both because of its strong established presence there, and because of concerns that delays in US west coast ports in late October/early November could impact fruit quality.

After consulting with its grower council representatives in Avofresh, Seeka decided to slow down harvesting and take advantage of potentially higher end of season prices in Australia.

“Our grower representatives decided they would prefer to take a chance on the Australian market improving at the end of the season, and that proved to be the correct decision,” said Dr Dixon.

“We were able to adopt that strategy because we have systems in place to consistently deliver the fruit in good shape, and because we put in place innovative incentive pricing for growers holding fruit till late in the season.”

Seeka, which is active in Southeast Asia and Japan through its kiwifruit business, continues to monitor all potential markets to improve avocado returns. One of the problems for the New Zealand avocado industry in developing into Asia was the market’s preference for small fruit, which gave local retailers a bigger return, said Dr Dixon.

Demand for the bigger fruit New Zealand produces was mainly in Australia and North America, he said. The US was a consistently lower value market initially developed in the expectation that New Zealand production would by now be much bigger than had proven to be the case.

“We are still a small producer in global terms -- New Zealand’s entire yearly production is less than one week’s supply of avocados in California,” he said.

“It makes sense for Seeka to concentrate on further developing the Australian market where we have established strong connections to leading supermarkets and can maximise returns for growers as we increase our exports there.”

ENDS

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