Australians to get their nuts cracked at home

Posted by AFN Staff Writers on 7th November 2012

In a refreshing twist to the expected old story of local shrinkage of aged manufacturers, Australians have received some very good news.

Australia’s largest and most dynamic, still relatively young and virile, nut producer and exporter, Walnuts Australia, a subsidiary of Webster Limited, has started building a nut cracking plant. The nut cracking plant at Leeton in the Riverina, in southern New South Wales, is reported to be a $10 million facility.

ABC Rural Radio has reported that instead of the walnuts being sent to Vietnam to be de-hulled, the nuts are to be cracked and packaged locally for domestic and export markets.

Operations manager Derek Goullet told ABC Rural Radio it means the company can double its business efficiency.

The Walnuts Australia operation of Websters is now based in 2 regions:

What began in Tasmania originally as a diversification idea in the 1990s by the late onion-and-carrot export entrepeneur Peter Gilham of Vecon, based near Forth in the Tasmanian north-west, was developed and expanded primarily through the pioneering efforts and new technologies introduced by manager Leigh Titmus. He was backed by a visionary approach taken by the management team of Websters to their investment.

Success was aided by innovative grafting techniques in its nurseries, based on modern forestry technologies, and by special contracting and marketing arrangements for the management of new orchards around Tasmania’s warmer east coast during the past 15 years.

In 2010, the company became the southern hemisphere’s largest walnut orchard manager and producer of walnuts through the acquisition of 1,365 ha of walnut orchard in the Riverina previously owned by the other major Tasmanian-based agribusiness operator Gunns Limited. The latter had also joint-ventured in some of the walnut contract-growing operations, but withdrew from the walnut industry as it was faced with various financial issues of its own.

( Subsequently, in September 2012,  Gunns, which also owned massive holdings throughout Tasmania and other Australian states from eucalyptus plantations to woodchip export operations,  hardware stores and wineries, went into Administration in insolvency after losing about $1 billion over 4 years in its principal business operations).

Australia’s Walnut Industry
Australia produces about 1,800 tonnes of walnut from what is believed to be 2790 ha, but rapidly growing. The area under cultivation was expected to increase to 3,140 ha by 2012. Australia currently still imports 4,000 tonnes of kernels (9,000 tonnes of in-shell equivalent) each year.

Apart from the Websters-owned operations, other smaller Australian walnut commercial operations exist in Victoria, the Adelaide Hills and Riverland regions of South Australia, and in south-west Western Australia.

Australian Food News previously reported good profits were being made by the ASX-listed Websters Limited from its Walnut Australia operations.

World Walnut Production

Of the 1.5 million tonnes of walnuts believed to be produced globally per year, the USA and China are the two major producers. USA (California) is the major exporter and while China is a significant producer. Other countries exporting walnuts include France, Turkey, Chile, Italy, India, Romania, Mexico and Spain.

While China is close behind the US in total production, there is a question whether it will remain a net exporter –  because the internal consumption of walnuts is still rising in China and might need to utilise its total walnut production to avert domestic supply shortages or risk excessive price increases in the domestic walnut markets.

Sparking outsider interest?

It is open to speculation as to whether there might be some international investors who are watching  with interest the expansion of the Walnuts Australia business. Australian Food News has previously reported the financial results of Websters as owner of the Walnuts Australia business.