Tuesday, January 31, 2017

Chinese greed blossoms in Tasmania’s cherry-ripe exports

Chinese greed blossoms in Tasmania’s cherry-ripe exports

Bei Hou at the Coal Valley Orchard in southern Tasmania. Picture: Peter Mathew
Tasmania’s famous cherry harvest is increasingly owned and consumed by China, with five of the last six orchards sold all bought by Chinese interests.
A surge in Chinese investment over the past 24 months has left at least six Tasmanian cherry orchards in Chinese ownership, while at least four other local growers have entered into joint ventures with Chinese investors.
The island state, with its combination of late-ripening cherries, timed perfectly for Chinese New Year and spring festival, and pest and disease-free status, allowing air freight exports direct to mainland China, cannot satisfy insatiable demand.
Exports of Tasmanian cherries virtually doubled last season to 2892 tonnes, worth an estimated $52 million, while sales to China more than doubled.
Almost every orchard is expanding, while production is expected to double by 2020 to meet “blue sky” demand, particularly from Asia and the Middle East.
“We have much more demand out of Hong Kong and China than we can ever supply,” explains Fruit Growers Tasmania business ­development manager Phil Pyke.
With local growers lacking the capital to expand to meet the ­demand, and Australian investors largely uninterested, Chinese entrepreneurs were stepping in. “The reality is that Australians aren’t buying these farms,” Mr Pyke said.
Harbin-based businessman Min Quan Shi has bought two cherry and mixed fruit orchards in the Coal River Valley, northeast of Hobart, since early 2015, and plans to double or triple the current 30ha of cherry trees.
Mr Shi has employed Chinese Tasmanian Bei Hou as director to run the two orchards, which trade as Coal Valley Orchard, ­exporting to China and Taiwan, as well as some domestic and local sales.
Ms Hou, who moved from China to Hobart 10 years ago and studied accounting at the University of Tasmania, said the potential for growth was massive, with markets across much of China’s north so far completely untapped.
As well as Tasmania’s “clean, green” reputation, the island’s late season cherry harvest was perfect. “The timing means Tasmanian cherries are available for Chinese spring festival when the tradition is that people take gifts to visit relatives and friends — and a box of Tasmanian cherries is just the best option,” she said.
Exports to mainland Australia were not as financially worthwhile, with Australians unwilling to match Chinese prices. “We ­export (overseas) nearly all of our first-grade cherries and we supply seconds to domestic market and smaller first-grade cherries to domestic market as well,” she said.
“Business is business — when you can get $20 a kilo on your top grade cherries (in China), you wouldn’t sell that for $10 or $15 (in Australia), would you?”
Mr Pyke said while the influx of Chinese capital was positive, it was changing the landscape, literally — with more orchards appearing across key growing regions — as well as culturally.
“In the last two years, the whole dynamics of the Tasmanian fruit sector has changed from those traditional, generation farms to the arrival of the foreign investors,” Mr Pyke said.
About 60 per cent of the state’s cherry harvest was now exported.