REPORT: What’s happening to cherries?
Cherry production and cherry exports are booming in Australia and especially in Tasmania. In 2006-7 production in Tasmania was 2000 tonnes of which 300 tonnes were exported; in the 2015-6 season Tasmanian orchards are estimated to have produced 5000 tonnes of which 2994 tonnes were exported, earning AUD $52million.
China bought 650 tonnes of Tasmanian cherries, while Hong Kong took another 650 tonnes of the cherries exported from Tasmania.
A happy convergence of factors has made Tasmania’s cherry farming the focus of keen interest from China:
- Tasmania’s late-ripening cherries are timed perfectly for sale as gifts for Chinese New Year and spring festival
- Tasmania’s status as pest and disease-free allows air freight export direct to mainland China
- Tasmanian cherries can be delivered within 48 hours of picking whereas Chilean cherries can take as long as 48 days to reach China by sea transport
Almost every cherry orchard in Tasmania has been expanding, and production is expected at least to double again by 2020 to meet the ongoing growth in demand from beyond Australian shores.
Difficulties obtaining the best cherries here
With some growers fetching AUD $20 per kilo for first-grade cherries in China, that leaves mainly the seconds and small, first-grade cherries for the domestic market. Australians are unwilling to match the premium export prices.
Meanwhile, Australia’s large supermarket chains are trying to push prices downwards or subsidising consumers with special offers on cherries. Last year, growers were unhappy with offers received from supermarkets to keep prices as low as $8 per kilo.
Hungry markets need reliable suppliers
The growth in Tasmanian cherry exports is shaping a pattern of investment in cherry farms that now includes Chinese investors. Of the last six orchards sold recently in Tasmania, five have passed to Chinese owners.
Coal Valley Orchard, a company which has acquired two cherry and mixed fruit sites in the Coal River valley northeast of Hobart since 2015, is owned by a Harbin (Manchuria) businessman who has been quoted as saying that there is another substantial and untapped market in northern China with massive potential for growth.
Tasmanian irrigation could enhance cherry greenfield opportunity
Tasmania enjoys a temperate climate. It represents just 1 per cent of Australia’s land area but generates approximately 12 per cent of Australia’s water runoff (about the same as the entire Murray-Darling Basin).
However, because it experiences regular dry spells in spring, summer and autumn when evaporation exceeds rainfall, Tasmania has a long history of irrigated agriculture.
Over the past 5 years, Tasmania has created new irrigation water rights for what were once dry land farming areas. It has done so by utilising the dams that were built to generate hydro-electric power.
Even though the hydro-electricity is part of Australia’s national electricity grid, and forms an important green energy resource, this does not preclude the release for irrigation of the plentiful water for irrigation purposes rather than manufacturing or industrial purposes that were contemplated at the time most of Tasmania’s dams were built some decades ago.
Better cultivation and labour-saving systems
Because cherries are a tree fruit, harvesting has traditionally been a labour intensive and therefore expensive operation.
However, the natural growth of fruit trees is now modified by the use of specialised trellises and electronically-controlled drip systems designed to enhance access to sunlight and protection from unsuitable weather and pests and to:
- Allow the trees to fill their allocated space early
- Restrict the effect of overcrowding which usually occurs with high densities
- Reduce tree spacing within the rows
- Encourage high early yields, and
- Restrict the height of the trees to allow for ground-level harvesting.
The extra capital costs are recouped by the reduced labour costs of harvesting, the high early yields, and the ability to fine tune production for harvesting at particular times when prices are at a premium, earlier or later than the concentrated peak period of the growing season.
Investment reshaping agriculture in Tasmania
In November 2014, Chinese President Xi Jinping, visited Hobart where he signed major investment agreements and witnessed the signing of a landmark memorandum of understanding for a China-Tasmania fruit industry partnership program.
The blossoming of the cherry industry in Tasmania is clearly evidence of strong progress in the implementation of the program.
- Tasmanian cherry exports to China
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