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Record avocado season prompts unprecedented challenges and innovation
16 August 2014

The New Zealand avocado export season has kicked off with a record-breaking crop that's catalysed a raft of firsts for the industry.

This is according to New Zealand's largest grower group AVOCO- responsible for 65% of New Zealand's avocado growers.

Director of AVOCO, Alistair Young, says that while a bumper crop may sound good, it will test the New Zealand industry and its ability to manage fruit through excellent flow planning and technical expertise, as well as inroads made into Asian markets.

"We're being presented with unprecedented challenges and opportunities," explains Mr Young. "Unlike last season when all exporters did well off the back of a poor Australian crop, reliance on Australia will not move the volumes we have this time. "

Complicating matters is Australia’s bumper crop this season which puts extra pressure on exporters like AVOCO to manage the flow of fruit at critical times of the year to avoid market collapse.

Mr Young says adding to the challenge for exporters is the knowledge that consumption in Australia needs to lift by 30% if AVOCO’s 2014-15 targets are to be met. To strengthen the demand for New Zealand fruit, both the industry and AVOCO will be pushing the promotional activities in Australia to the absolute limit.

At the same time, 34% of AVOCO's exports will be going outside Australia through the associated AVANZA channel to reach consumers in developing Asian markets and the US.

"We have had the foresight to build strong relationships in Asia and the US over the past seasons, so we're ready for the challenge that large crops in New Zealand and Australia present," says fellow AVOCO Director John Carroll.

The national crop estimate for the 2014/15 season is over 7 million trays, with an expectation of nearly 5 million being exported. New Zealand’s previous high was 6.2 million trays in 2011/12. Last season, 3.1 million trays of avocados were exported.

Through AVANZA's painstaking work in the Asian market, as well as partnerships forged with export partners in recent years, this season is tipped to be a success for AVOCO growers.

Planning has been key says Mr Carroll, some of which has prompted a raft of necessary firsts for the industry to ensure it grows with the volumes this year.

"We'll be shipping the largest ever programme of Controlled Atmosphere containers to Asia this year. The Port of Tauranga has had to put in place a special nitrogen flushing mechanism to make this possible.

"The development of this technology for avocados is crucial if we're to expand to lucrative far-flung markets and maintain the high quality of our fruit during their shipment. It's been a learning curve," says Mr Carroll.

Unprecedented volumes will also be going to America explains AVANZA Export Marketing Manager Martin Napper. AVANZA has been establishing ties with California-based avocado marketing company, Mission Produce Limited, culminating this season in a two-pronged strategy to tackle New Zealand's large fruit volumes.

"Firstly we'll be supplying more avocados than ever to the US market. We've been in and out of there, but we've focussed on creating strong and enduring relationships and now we're going to capitalise on that, just when we need it most."

Another initiative started with Mission Produce sees AVANZA entering into the first stage of a 12-month sourcing strategy to Asian markets, dubbed Partners in Asia.

"This arrangement recognises New Zealand as a premium supplier during the September through January months, with the aim of Mission supplying avocados from other origins outside that window," says Mr Napper.

"The long term objective is being able to provide our customers coordinated supply of quality product all-year-round."

Last week AVANZA hosted a trade dinner in Hong Kong, in conjunction with the Fruit Logistica exhibition where AVANZA and Mission Produce exhibited together. The dinner was a chance to reinforce the partnership's vision for 12-month supply.

A similar arrangement of coordinated supply into Japan this season has been established for the first time with Fresh Systems. The aim is to promote the projected four-fold increase for the Japanese market says AVANZA Export Manager Ted Thomas.

"This push into Japan and Asia has been backed by the largest investment in promotional activities ever. We need to drive consumption and raise awareness of the presence of New Zealand avocados in those markets," says Mr Thomas.

The promotional activity will kick off in Japan with an awareness campaign around the availability of New Zealand avocados at this time of the year, dubbed 'Shun'- the Japanese word for "best in season". There will also be a smoothie wagon, dedicated to selling avocado smoothies to early adopters and influencers.

Avocado sampling will be part and parcel of all promotions across Asia to engage bloggers, media and beauty specialists about the health benefits of the fruit, as well as their versatility in cooking, particularly in the cuisines of the individual countries.

There will also be close and detailed work on the ground with retailers and suppliers with training in stores.

"We know that these markets are highly receptive to the New Zealand story, which is part of what we use to convey the premium nature of our product," adds Mr Thomas.

Hurdles in Japan still include a demand for smaller fruit, when New Zealand produces mostly larger fruit, as well as a penchant for green fruit, rather than ready-to-eat ones due to the fact that avocados are delicate and perceived as being 'risky' if not green.

"These are all things we're working hard to change this season, including an intensive ripe programme that involves a brand a new state-of-the-art distribution centre operated by Fresh Systems in Japan. This centre has the sophisticated ripening facilities that will mean we can deliver impeccable avocados that are ripened and ready to eat in perfect condition.

In another first for the season, AVANZA Market Manager of South East Asia, Carwyn Williams, says the first container load of avocados is due to hit Thailand.

"I'll be on the ground to support our Thai distributors as they receive the first of many 40ft container loads of New Zealand avocados this season. This move has significantly reduced our freight costs to Thailand, which was previously serviced by air.”

In Bangkok New Zealand avocados are about to be launched throughout the Central Food retail chain.

"Central Food boasts 1275 stores currently, including a mixture of family marts and 7-Eleven type stores. This is the first time that avocados are being introduced into this convenience store environment- as an everyday item to be used daily. That's a big move and an exciting prospect.

"There's no shortage of progress for New Zealand avocados through AVANZA in Asia. It's an exciting season for the industry that will really test our abilities and strengths for the future. "

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