Page 26 - Food & Drink Magazine Jan-Feb 21

FRESH PRODUCE
Cracking a volatile market
The $129 million acquisition includes 1566 hectares of almond orchards, the 2021 almond crop, water entitlements, as well as some plant and equipment, and a further 641 hectares of unplanted land.
Thompson says Piangil had an appealing maturity profile, with a weighted average age of 10.9 years and approximately
25 per cent immature plantings.
“It has demonstrated consistently high yields in recent years and is a top quartile orchard. The recent bloom at the orchard was strong, indicating the potential for another above industry average crop in 2021. Post the acquisition we remain within our water strategy,” he says.
Select’s immediate focus will be to invest in equipment and infrastructure to improve yield, quality, harvest risk mitigation and irrigation efficiency.
FROM GROWER
TO SUPPLIER
Select has two processing facilities. The Robinvale plant
in north west Victoria, near Mildura, only processes almonds. Around 25,000 tonnes are processed a year, predominantly for the industrial market, with 80 per cent for export.
Thomastown, on Melbourne’s outskirts, processes 10,000 tonnes of almonds, other nuts and pulses, with 90 per cent for the domestic market. Most of its primary processing equipment comes from the US, with the value-adding components European in origin. “Both sites can produce anything from a 110-gram consumer packet to a half tonne bulker bag. In B2B they want less and less packaging and in consumer it is moving towards portion control,” Thompson says.
“We’ve expanded from just being a grower. As an ingredient supplier we can bag in any format. We’ve got two operating assets that can add value to nuts and pulses by bagging, slicing, dicing, roasting, salting, flavouring or pasting.”
Select Harvest’s brands include Lucky, Sunsol, Allinga Farms, Renshaw and NuVitality. Forty per cent of the business is private label
Running one of the world’s largest vertically integrated nut and health food companies is responsibility enough but managing the business through drought and pandemic took added mettle. Kim Berry spoke to Select Harvests managing director Paul Thompson.
PAUL Thompson joined Select Harvests eight years ago, after being president of SCA Hygiene Australasia (now Asaleo Care). “I’ve been in the FMCG land for a while now,” he told Food & Drink Business.
Originally, Select was handled by the managed investment scheme company Timbercorp, which collapsed in 2009 owing creditors
$750 million with more than 18,500 investors affected. It was one of a number of collapsed agricultural and forestry managed investment schemes that were wiped out by an Australian Tax Office decision in February 2007 to end the ability for investors to claim tax deductions for upfront fees and the global financial crisis.
Thompson says: “At that stage we knew a lot about growing almonds, so we went out and progressively bought farms either privately owned or from managed investment schemes. From there we invested
$100 million in greenfield almond farms.
“In the last four years we’ve grown from fourteen tonnes to twenty-nine tonnes.”
In FY20, Select reported a net profit after tax of $25 million, which was down almost 53 per cent from $53 million the previous year.
This was despite producing a record crop of 23,250 tonnes. Weaker almond prices, COVID-19 market disruption and a massive spike in water costs all played a part.
“Almonds are a commodity and pricing is extremely volatile – we’ve had a tough year, but we’ve been fortunate in a lot of ways,” Thompson says.
In October 2020, Select purchased the Piangil Almond Orchard to add significant scale to its portfolio. The orchard, about 80 kilometres from its Carina West processing facility, is expected to increase almond production by 4600 square tonnes in its first full year.
ABOVE: Shaker in action in the orchard.
TOP RIGHT: Almond checking and sorting underway.
BOTTOM RIGHT: There are 32 products in Select Harvests’ Lucky cooking range.
26 | Food&Drink business | January/February 2021 | www.foodanddrinkbusiness.com.au