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As we noted in the March 2018 Avo Insider, the Chileans are coming. The Department of Agriculture and Water Resources (DAWR) has opened the consultation period for its draft report for the review of the biosecurity import requirements for fresh avocado from Chile.
Avocados Australia will be putting in a submission before the 29 April deadline and our Board and DAWR representatives will be meeting in coming weeks to discuss this report and potential implications. Please call your region’s director (contacts here) if you would like to raise any issues before this meeting takes place.
The draft report proposes importation of fresh avocado fruit from all commercial production areas of Chile be permitted, subject to a range of biosecurity requirements.
It’s important that any imports in no way jeopardise the biosecurity of the Australian avocado industry.
What’s in the report?
The draft report identifies seven quarantine pests associated with fresh avocado fruit from Chile that require risk management measures to reduce the biosecurity risk to an acceptable level:
- Fruit flies: Mediterranean fruit fly (Ceratitis capitata)
- Mealybugs: grape mealybug (Pseudococcus maritimus)
- Thrips: Chilean flower thrips (Frankliniella australis), tamarugo thrips (Frankliniella gemina) and western flower thrips (Frankliniella occidentalis)
- Mites: avocado brown mite (Oligonychus punicae) and avocado red mite (Oligonychus yothersi).
The draft report proposes risk management measures, in combination with operational systems, to reduce the risks posed to achieve the appropriate level of protection for Australia:
- area freedom, fruit treatment (such as cold disinfestation treatment) or hard condition of fruit (for the Hass cultivar only) for Mediterranean fruit fly
- consignment freedom verified by pre-export visual inspection and, if detected, remedial action for grape mealybug, Oligonychus spider mites and thrips.
We encourage anyone who would like to contribute to our Avocados Australia submission to contact the office (details below) or provide their own submission to the DAWR (links at the end of this article).
Research on the potential impact
Issues for the industry
There are two main issues for the Australian avocado industry.
1. Quarantine risks
Future imports from Chile to Australia could introduce new pests or diseases that we don’t have. This is a government-to-government process. Avocados Australia needs to be sure the process is thorough and that we are confident the recommendations are sound.
We will be reviewing the full report thoroughly in the coming weeks and will be raising any questions or concerns with DAWR when we meet.
2. Competition risk
We need to address the potential commercial impact Chilean imports could have on the Australian industry.
Avocados Australia and Hort Innovation initiated a project to understand the potential impact of avocado imports from Chile and/or Peru on the domestic industry. This report, Potential Impact of Chilean and Peruvian Avocado Imports for the Australian Avocado Industry (AV17004) can be found in the BPR Library, in the R&D Reports section.
This report indicated that imports from Chile were likely to proceed and provided three key steps for industry to mitigate the impact:
- increase efficiencies to reduce costs,
- develop strong alliances and
- implement an export strategy.
The industry has moved on all of these recommendations.
Avocados Australia has been proactive on behalf of industry with regard to helping direct levy-funded research toward quality improvements, efficiencies from the farm to the retail level, and increasing the Australian industry’s own export activities.
Clearly, Australia is an attractive market not just for Chile but potentially also Peru and Mexico. We have high per capita consumption and consumers willing to pay high prices.
As a comparison, in December 2018, a conventional Hass is worth between US$1 and US$1.22 on average at retail level in the US. At Tesco in the UK, a medium avocado is currently 85p and a large avocado £1 (AU$1.87). And in Australia? A single Hass (size not specified) is $2.50 this week.
Another benefit for Chile will be their ability to supply during the summer months, when we already rely on New Zealand to bolster domestic supplies. In fact, one possible goal for Chile could be to replace New Zealand supply in our summer season.
Against these benefits of the Australian market are, however, some negatives:
- we are a small market, in world terms, compared with the main current export markets for Chile
- as noted in the AV17004 impact report, airfreight from Chile to Australia is not a viable option. Seafreight is a viable transport option to Australia but is likely to require dedicated reefers to overcome the current limited options.
As the report says: “Under different scenarios, total time for Chilean avocados from pick to clearance into Australia could vary from 18 to 37 days. Current existing routes have crossing times ranging from 17 to 35+ days, equating to 22 to 37 days in total time. However, while it may sound surprising to Australian growers, Chile makes times under 30 days succeed within other markets. This is due, in part, to the Chilean dry climate and an industry highly targeted at serving export across all stages of the value chain.
“If and when Chile were to move to dedicated reefers, there would be a significant decrease in transit times, to a highly viable 18–20 days from pick to clearance into Australia. Among other benefits, this would dramatically improve average fruit quality from Chile.
“Past actions in other markets suggests Chile can utilise seasonal reefers for quantities around 4,000 tonnes. Were Chile to dispatch six direct reefers over a six month season, this would be the equivalent to the current Australian import volumes from New Zealand.”
For industry, there is likely to be little impact in the short term, and the medium term impact will depend on a whole range of factors. Will they come? Time will tell, but it is certainly something we need to monitor, and prepare for.
Links
Contact Avocados Australia
John Tyas
Email: j.tyas@avocado.org.au
Telephone: 07 3846 6566
This article was produced for the March 2019 Avo Insider.