The man steering the Australian almond juggernaut is not long back from a major industry conference in California with a few problems and a lot of potential on his hands.
Almond Board of Australia chief executive officer Tim Jackson is overseeing an astonishing industry growth phase which has seen plantings – spread from SA’s Riverland through Victoria’s Sunraysia and into the southern Riverina of NSW – soar by a factor of 20, in barely 20 years, up from a meagre 3500ha to 62,500ha, and counting.
But by the time Mr Jackson was back from the US he already knew this 2024 crop estimate would be the biggest in the industry’s history.
“This year has been very challenging with yields well down and an overall crop of just over 103,000 tonnes,” he says.
“We look like bouncing back with almost 165,000 early next year. Everyone needs a big crop because prices are still low and our exchange rate with the US dollar is going the wrong way.”
“The annual Californian conference is a temperature check. They dominate production with 75 per cent of global supply.
“They continue to do it tough and we are seeing plantings being reduced for the first time in many years.”
With California responsible for most of global production, compared with Australia’s 10 per cent (and climbing), Spain is number three, and in a good year can match Australia but a bad season there with drought can see its production more than halved.
Portugal and Italy are also recognised as small producers.
These key producers all happily compare notes on the production chain and industry activity, from production to marketing.
Mr Jackson describes his industry as “demand creative” as it battles a drop in global demand for the first in recent memory.
“Part of our creativity is making sure what we are producing aligns with expectations in the domestic market, in particular that we meet consumer sentiment, the demand for sustainability, and are aware of pricing and access,” he added.
“One of the biggest drivers here has been a growing awareness for many producers that almonds are a better, more reliable crop – across the southern Murray Darling Basin almonds are seen as a crop which will consistently deliver stronger results through more efficient use of water, and as a result a lot of people started to come around.
“It’s not that long ago that from the choke to the Murray Mouth there were just three almond plantations, but they are now the biggest crop there, accounting for 25 per cent of national production,” Mr Jackson explains.
“We have seen everyone from dryland farmers to cotton and rice growers or mixed farmers, either make a complete swap or add almonds into their mix.”
The not-so-good news for almonds is the falling yield – in December the ABA forecast 156,200 tonnes but a poor season has cut that by 34 per cent, with the 2024 intake coming in at 103,381 tonnes.
Mr Jackson says poor conditions compounded by poor pollination due to cool and wet conditions.
That said, he remains confident the industry will bounce back and is still on target for its 200,000 tonne dream in five years.
An increase which will need at least another 50,000 tonnes in total but as more and more of the new plantings reach peak production it is a realistic ambition.
“In real numbers that means we have gone from exporting 52,795 tonnes in 2013 to 115,049 tonnes in 2022.
“The Almond Board ends up with a $7M program to increase almond exports by at least those 50,000 tonnes I mentioned earlier in the next three years and push export sales beyond $1 billion.”
The program will support the almond industry through a range of market access and development activities such as participation in trade shows and missions, educational messaging about health benefits and engagement with key trade stakeholders.
Mr Jackson said the ABA has led the industry’s market access and trade development activities for more than two decades and is “ready for the challenge of expanding our export growth”.
“Five years of intensive planting supported by massive, mostly, corporate, investment has laid a strong foundation for the next era of our industry,” he says.
“There are 800 million people on our doorstep who are not huge consumers, not even big consumers, of almonds.
“This money will help us kickstart a campaign to find new customers in South-East Asia – we do business in China, India, Europe and the Middle East, but so do the Americans, and they can spend $100 million a year in marketing.
“There have not been any major efforts in countries such as Indonesia, Malaysia, Singapore, Vietnam, Thailand and the Philippines.
“If we can educate those countries about the benefits of almonds as a source of nutrition and protein, we will struggle to grow enough to meet the market.”
The other market news moving forward is the American harvest will also be down, on the back of its own poor season, and that will play out on the world stage in the next 12-24 months.
Mr Jackson says the US has been integral in the opening of many almond markets, and Australia has been able to ride on its coat-tails for the benefit of its own growers.
But SE Asia looms as a key market for the whole industry to drive demand and push pricing back into more viable territory.
“Our industry has grown production from 7000 tonnes in 2002-03 to more than 142,805 in the 2022-23 season. Following the past five years of planting, the production of Australian almonds is forecast to reach 200,000 tonnes in the near future. Total shipments will need to grow by at least 50,000 tonnes to meet the supply growth of industry – which is what this program is here to do.”
Developing new, emerging and existing markets continues to be a core priority for the industry, with growers looking to the marketers to maximise their return by seeking out the most lucrative markets.
Consumption in Australia is 1kg per person per year, so there are also opportunities to expand the home market. And in 2021-22, 59 per cent of Australia’s almond production was exported.
Mr Jackson says the almond industry’s trade program has been a pioneer in developing markets in more than 50 countries, so he is confident with the extra funding they will be able to replicate that success through SE Asia.
“A strength of almonds is shelf life, this is a product which is good for two years or more – that’s not really an option for stone fruits, or citrus and table grapes, their window of opportunity might be two weeks,” he added.
“Almond growers can hang onto their production and sell when there is a price they like.”
About 80 per cent of Australian growers are individual operators on small to large farms, but the corporate enterprises account for more than 80 per cent of total production.
It is also one of those rare agricultural commodities that does not exist at the beck and call of the supermarket duopoly, giving it greater marketing flexibility and individuality.
“Investment is driving the big scale growth, the historically low interest rates have forced the big players to look for better returns than a bank and the low Australian dollar makes our exports attractive,” Mr Jackson says.
“While we do not operate a single desk system, ABA does the marketing for Australian origin product as well as collaborate with the five main marketing streams, which are:
• OFI (Olam Food Ingredients)
• NPA (Nut Producers Australia)
• Bright Light
In 2024 there will be a sixth marketing entity with Murray Downs almonds opening a new processing factory at Swan Hill and they have already committed to joining the ABA marketing program.
“With the depth, experience and production skills of the Australian industry, the massive injections of cash from the investment industry and the rapidly expanding growing areas, our almond industry is on the verge of its next big era,” Mr Jackson concluded.