Gluts, Guts, and Governance: Fixing Australia’s Fresh Produce Chaos

"Truss tomato grower calls for shoppers to help combat oversupply, AusVeg SA points to tomato business expansion"

"Truss tomato growers in South Australia are facing an oversupply crisis, selling below production costs due to industry over-expansion, a warmer season, and a tomato virus. Limited interstate market access has worsened the glut. Growers urge shoppers to buy more truss tomatoes to help stabilize the market, while considering sustainable changes like crop diversification or adjusted planting schedules"

Oh, Australia - the land of sweeping plains, droughts, flooding rains, and apparently, a complete inability to figure out who is growing what, where, and how much of it. If the truss tomato glut currently devastating growers wasn’t proof enough, the broader patterns in our fresh produce industry certainly are.

Let’s break this down. Right now, South Australian truss tomato growers are practically giving away their produce because of oversupply. These growers are selling at prices well below the cost of production, desperately trying to offload their tomatoes in a market saturated by an earlier-than-usual season, over-expansion in the industry, and trade restrictions caused by the Tomato Brown Rugose Fruit Virus (ToBRFV). And let’s not forget, not long ago, Michael Simonetta, CEO of Perfection Fresh - a well regarded name in Australian produce - warned us that tomato prices would rise because quarantines and crop destruction at their facilities were curtailing supply.

So, what’s going on? We’ve gone from dire warnings about reduced availability to farmers drowning in a surplus they can’t sell. The truth is painfully simple: we have no idea what we’re doing when it comes to forecasting fresh produce production in Australia.

This isn’t a one-off issue. The lack of coordinated data collection and forecasting in our Australian fresh produce industry is a glaring problem - one that’s been ignored for far too long. Who is growing what? Where is it being grown? How much is being produced? These are fundamental questions, and we don’t have the answers. Instead, we lurch from one crisis to the next: gluts that drive prices below cost one moment and shortages that spike prices the next.

Imagine for a moment if we had a robust forecasting system. Growers could plan their crops with market demands in mind, balancing supply and demand to achieve optimal, profitable, and sustainable farm-gate prices. Retailers could better manage their procurement, and consumers wouldn’t be yo-yoing between rock-bottom prices and exorbitant ones. Everyone - from farmer to shopper - would benefit.

But here we are, with farmers like Matt McInerney in South Australia struggling to move their tomatoes at $5 to $7 per tray when it costs $9 to $10 just to grow them. Meanwhile, the same growers are told that food processing or switching to other crops like cucumbers or capsicums might be their only viable options. Seriously? Is this the best we can do as an industry and as a country?

And while we’re at it, let’s address the elephant in the room: Australia’s complete unwillingness to process excess fresh produce to balance supply and demand. Time and again, our industry chooses to shrug its collective shoulders instead of investing in solutions that could transform surplus produce into valuable goods. Why? Lack of courage? Determination? Vision? Whatever the reason, the outcome is the same: downward pressure on farm-gate prices that leaves growers struggling to make ends meet.

To add insult to injury, Australia continues to import significant quantities of tomato-based products. The numbers are eye-opening: nearly 60,000 tonnes of processed tomato products annually, valued at about $120 million AUD. This includes products like canned tomatoes, pastes, and sauces, much of which comes from countries like Italy. Imagine the irony: our farmers are drowning in fresh tomatoes they can’t sell, yet we’re buying processed tomato goods from overseas. Is there any clearer sign of a broken system?

What’s even more infuriating is that we could easily curtail these imports by processing our own tomatoes. By investing in processing facilities to handle excess supply, we wouldn’t just reduce reliance on imports; we’d create jobs, support farmers, and ensure more stable prices for consumers. Instead, we let opportunities rot - sometimes quite literally - because of a lack of industry coordination and investment.

It’s our own fault, sorry to say, as Australian fresh produce growers. We’ve failed to come together as an industry to work towards a national solution. We’re not investing in collaborative tools or accurate data systems to balance supply and demand. We’re not investing in facilities to process fresh produce that might otherwise flood the market and crash prices. Instead, we let the problem fester, creating a cycle of unsustainable and unprofitable outcomes for farmers.

The current situation underscores the urgent need for reform in the way we manage fresh produce. Industry bodies and government agencies must step up. We need:

1. Comprehensive Data Collection: A centralized system to track who is growing what, where, and how much. This data would be the backbone of effective forecasting.
2. Sophisticated Forecasting Models: Using data to predict market conditions, weather impacts, and trade disruptions.
3. Collaborative Planning: Coordination between growers, industry bodies, and government to align production with market demands.
4. Investment in Processing Infrastructure: Facilities to turn excess produce into processed goods, balancing supply and demand while creating value-added products.
5. Incentives for Sustainability: Support for growers to transition to more sustainable practices and crop choices without being left to fend for themselves.

Instead, we’re left watching the chaos unfold, with growers begging shoppers to eat more tomatoes. Let’s be honest: the onus shouldn’t fall entirely on consumers. The fresh produce industry needs systemic change, and it needed it yesterday.

Until then, truss tomatoes are cheap, processed imports continue to dominate, and farmers are suffering. Is this what we call the lucky country?