Inspiring change in the Australian apple industryFrom 19t/ha to 40t/ha in 6 years

Prepared by: Jesse Reader

Title: General Manager & Senior Horticultural Consultant, AgFirst Australia

Date: Wednesday 15th October 2014

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Lets discuss the following…

PART 1.• AgFirst, who are we and what do we do?• The Australian Apple IndustryPART 2.• What happened to cause change?• When did it happen?• Why did it happen?• How did it happen?Part 3.• So why not for Macs?

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AgFirst, who are we and what do we do?

• AgFirst is New Zealand’s largest network of agricultural, horticultural and agricultural engineering consultants

• Offices in Australia and New Zealand

• Our core business activities are: technical and financial consultancy, applied research and development, technology transfer, environmental monitoring services, data capture and management, and industry intelligence

• AgFirst have been working in Australia for the apple and pear industry for 8 years

• Commissioned to deliver the world class Future Orchards™ project

www.agfirst.co.nz

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The Australian Apple IndustryThe important numbers…

• Apple and pear industry has an estimated gross value of production of $450 million, making it the 3rd largest horticulture industry (after grapes & citrus)

• 280,000 tonnes of apples produced

• 105,000 tonnes of pears produced

• Highest COP of nearly any apple growing region in the world

• 680 growers over 8 major regions

• Approx. 13,000ha

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The Australian Apple IndustryThe major challenges…

• Managing high cost of production

• Stimulating domestic consumption

• Increasing exports

• Managing risk

• Increasing production and pack out

• Maintaining desirable market returns

• Attracting people, in particular, youth to our industry

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What happened to cause change?A paradigm shift in thinking and an increase in production from 19t/ha – 42/ha

In 2006 APAL crystallised the problem by saying:

“To compete globally, Australian orchards need to be able to produce high proportions of premium quality fruit at a lower cost than today, be able to change varieties relatively quickly and reach commercial production levels early.”

As a result, a road map to an internationally competitive Australian apple and pear industry was created and goals were set.

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When did it happen?

• Between 2006 and 2013 the Australian apple and pear industry focused on doubling production

• In 2006 it received DAFF funding for 2 years in order to try and reach its goals

• In 2008 the industry continued to fund this endeavour for a further two years

• In 2010 the results were so strong the industry committed to providing ongoing support for a further 12 months

• In 2011 the industry again allocated funding to this program for a further two years

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Why did it happen?Because sitting still is going backwards…

• Several years of poor return

• Significant jump in wages

• Threat of imported fruit from NZ

• Identified as being uncompetitive by international standards

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How did it happen?

Well…How do you eat an elephant?

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How did it happen?Project Goals set in 2006

Year 2:

• Australian apple and pear growers are thinking about and planning new actions in relation to intensification, product quality, international competitiveness and profitability.

Year 5:

• All new plantings are intensive. Older plantings are managed to provide maximum profitability.

Year 10:

• The Australian apple and pear industry is internationally competitive

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• After broad consultation APAL put in place a world class productivity and extension program lead by AgFirst

• Future Orchards® became the flagship program of APAL

• Launched in 2006 to provide growers with practical, hands on education tools to help increase quality and productivity in their orchards and assist the industry in becoming internationally competitive

• Future Orchards is a national program funded through the R&D levy, with matched funds from the Government

How did it happen?

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How did it happen?The marriage…

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• Early focus for the project was based on identifying the drivers for increased productivity.

BUSINESS DRIVERS1. Identifying the ‘real’ cost of production2. Understanding return on investment3. Benchmarking

• All these things provided the management team and industry at large with focus and direction.

How did it happen?

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AGRONOMIC DRIVERS

1. Orchard planting density

2. Vigour / canopy management

3. Biennial bearing / regular cropping

CULTURAL DRIVERS

1. Shifting mindset – “We can’t” “We can”

2. Collaboration / information sharing

3. Local expertise

How did it happen?

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• In 2006 we ‘literally’ drew a line in the sand and urged the industry for commitment.

• Those that took on the challenge have been handsomely rewarded.

• Those who chose to resist change find themselves in a very marginal situation in 2014

How did it happen?

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2014 AMS 40th Anniversary Industry Conference proudly presented by

How did it happen?Let me tell you a quick story…

When I sent my note of congratulations to Rob, I received a very poignant reply:

”Still a bit shocked myself. Didn't look like a 90t crop and makes me think that there's a bit more to come. The driest summer that I have had to combat, made it a year to look back and say that I have learnt something.”

"Apple growers carry too much baggage, we are so much better off when we find solutions instead of excuses.”

“Many thanks to APAL and the AgFirst team for the Future Orchards program and helping to remove the blinkers.”

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2014 AMS 40th Anniversary Industry Conference proudly presented by

How did it happen?Anything is possible…

The following year, Rob achieved 102T/ha of high quality marketable fruit, proving to himself, his local growing community and the industry at large that 100t/ha of high quality fruit in one of the hottest and driest growing regions in the world is absolutely possible!

In 2012 Rob was named the Australian Fruit Grower of the Year.

A little over a month ago, Rob was named the Australian Farmer of the Year…

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South Australian apple grower Robert Green wins ABC Rural and Kondinin Group 2014 Australian Farmer of Year award

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How did it happen?Effective & appropriate technology transfer

TIMELY – TARGETED – TECHNICAL

• Utilise local experts

• Use multiple forms of communication and extension tools

• Maintain regular contact

• Be robust in your review

• Be unwavering in your message and direction for the industry

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24The number of technical magazine articles produced by the program over the last 24 months

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2014 AMS 40th Anniversary Industry Conference proudly presented by

15The number of technical webinars produced

by the program over the last 24 months

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Pruning Demonstration

Bud Counting and TCA Measurement

Variation in Flowering

Improving ATS Effectiveness

Fruit Size Monitoring in the field

Fruit Size Monitoring using OrchardNet

Optimising Harvest

Orchard Systems Pt 1: A few to compare

Orchard Systems Pt 2: Show me the money

Picking Techniques: Fruit lineup

Picking Techniques: Bag setup and bin filling

Picking Techniques: Picking and fruit handling

Picking Techniques: Ladder work

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520The average number of people who attend

Future Orchards every 12 months

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16+5+10=31The number of world apple and pear experts

that have been bought to Australia during the Future Orchards program

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Alberto Dorigoni Mark Goodwin

Terrance Robinson Steve McCartney

Jan Peters Karen Lewis

Stuart Tustin Ben Van Hooijdonk

John Palmer

Martin Thomman Juergen Christanell

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120The number of presentations/fact sheets entered into the library during the Future

Orchards program

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2014 AMS 40th Anniversary Industry Conference proudly presented by

$1.15

The cost of production per gross kg of fruit produced in 2011/12 as determined by the

Australian Orchard Business Analysis

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0%

10%

20%

30%

40%

50%

60%

70%

80%

90%

Cla

ss 1

re

cove

ry %

$0.00

$0.50

$1.00

$1.50

$2.00

$2.50

$ r

etu

rn p

er

clas

s 1

kg

Class 1 RecoveryOrPack out

Dollars returnPer class 1 kg

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16+19=35

The number of Focus Orchards and case studies produced across the eight growing regions of Australia in the last 15 months

with the support of our Front Line Advisors

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2014 AMS 40th Anniversary Industry Conference proudly presented by

Is all this working?I’m glad you asked…

• 99% found the consultant’s presentation valuable or of some value

• 100% found the guest’s presentation valuable or of some value• 100% found the in orchard presentations and discussion valuable

or of some value• 100% found the opportunity to visit the venue valuable or of

some value• 100% rated the event organisation as excellent or good• 100% learnt something that would work in their orchard or

business• 96% learnt something they would definitely implement in their

orchard or business• 100% thought they would attend other Future Orchards events

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So why not for Macs?Fundamentals are the same…

• Same economic drivers – productivity, pack out (recovery), price

• Same horticultural challenges – pest/disease, vigour management, biennial bearing

• Growers are growers – resilient, innovative, results driven

• Same environmental/geographic challenges –risk mitigation critical for both

• Both have a fantastic product worth investing in!

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A 10% increase in crop recovery equals a doubling of profit!

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• As production goes up cost of production goes down.

• Top performing growers always spend more putting on the crop but in return have superior productivity, packout and price.

• Be careful you don’t save a dollar, only to lose three!

So why not for Macs?These key points apply to you…

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So why not for Macs?Consider the following…

• Crop load regulation - thinning, manipulated pruning time

• Plant Growth Regulators - very effective tools when used correctly, may well be your road to success

• Growing system design - push the boundaries on tree architecture

• Beefing up spray programs - if you think you have done enough, you probably haven’t

• Immersing yourself in similar industries to fast-track your goals

• Apply these considerations in the early years – prevention rather than cure!

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Late spring “Lorette”pruning at 10-14 leaveswas named after LouisLorette, whose studiesdescribing the effects of summer pruning date

back to 1900-1914.

So why not for Macs?

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Auvil Fruit Co. – 130T/ha on 32yr old trees!

• Applying chainsaw cuts to the trunk to control vigour, goes 80% of the way through!

• Applies plant growth regulators 3-4 times per year to control vigour.

• Root prunes every second year to control vigour.

• Manages crop load to control vigour.NOTHING HAPPENS BY ACCIDENT!

So why not for Macs?

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Things are never as bad as you think they are going to be and never as good as they seem.

Your challenges can be overcome with focussed, collaborative effort but be mindful of waiting around for someone else to fix your problems.

Summing up…

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Be diverse when tackling your problems, the silver bullet doesn’t exist…

Never treat an issue in isolation. A holistic approach is required to fix the problem and make the change sustainable. Failure to do so often results in further consequences.

Summing up…

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You know what they say about doing the same things over and over again and expecting a different result…

As a horticultural industry, we have to constantly be on the look out for new solutions to our problems

Summing up…

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On behalf of AgFirst I thank you for the opportunity to speak and look forward to helping you overcome your challenges into the future…

Thank you