Major tomato industry player goes broke, but who is responsible?

Posted by AFN Staff Writers on 22nd February 2012

One of Australia’s largest tomato growers, SP Exports, which at its peak grew up to 30 per cent of all fresh tomatoes eaten in Australia, has become insolvent. Administrators Korda Mentha were appointed when the company could no longer pay its debts. It is believed that about 60 of the employees lost their jobs at Childers last week.

The company, which has tomato-growing operations across northern Queensland in Bundaberg, Childers and Bowen, has suffered a series of major setbacks over the past two years.

Australian Food News reported in December 29, 2010 that the company was one of many hit hard during the Queensland floods of late 2010.

Additionally, a million dollars damage was caused to its cherry tomato crops after a chemical spray drift in March 2011. Then, in July 2011, its Bowen farm’s nursery irrigation system was believed to have been sabotaged causing $7 million worth of damage to tomato seedlings.

Supermarkets unfairly blamed?

While many tomato growers are saying that the low prices campaign by the supermarkets is ‘the last straw’ in SP Export’s battle for survival, they acknowledge that there has been a tomato glut throughout Australia.

The glut has arisen from excellent growing conditions over the past six months throughout Australia. At the same time, new competitors using modern intensive glasshouse technologies have emerged.

Australian Food News recently reported the huge developments of new major tomato-growing facilities, run respectively by the Smorgon group near Adelaide in South Australia and the Costa group in northern New South Wales.