BETTER OUTLOOK FOR AUSTRALIAN CROP
It is estimated that processors are looking for 355,000 tonnes from the 2004 harvest. This represents a big recovery from last season's disastrous 260,000 tonne harvest that was seriously affected by the country's long-term drought.

This season, rainfall has been more "normal" and the supply of irrigation water for the 2003-2004 crop is assured.



Since the start of planting around the beginning of September, weather conditions have generally been favourable though cool weather in October and January has resulted in a late start to the harvest and anticipation of crop "bunching" in March As usual, there has been some isolated crop damage. Generally, the industry is in much better heart than a year ago.

Australian tariff protection is minimal so the industry is sensitive to overseas market trends. Following the 2003 harvest that totalled 28.3 million tonnes globally, world stocks of tomato products appear to be in reasonable balance with demand, though there are some structural imbalances. However, following rapid expansion of the China industry, global production capacity exceeds demand and this is likely to lead to over-production in 2004 and sustained soft paste prices.

Estimates of 2004 production from most major producing countries are not yet available. However, the January forecast of California production came in at 11.0 million short tonnes, 19% more than the 2003 harvest. While the industry may react to this information with some pull back it seems unlikely that California bulk paste prices will rise above 30c/lb in the foreseeable future.

Exchange rate movements over the past 12 months have put additional competitive pressure on the Australian industry. The currency has strengthened by 30% against the US, from US54c at January end 2003 to US76c this year. The strengthening compared with the Euro has been a more modest 13%, from E54c to E62c.

The Australian industry has consolidated significantly in recent years and there are now only four "major" processors and around 30 specialist processing tomato growers. The industry is currently reviewing its structures and the shape of processor-grower co-operation is changing significantly. APTIC, the former peak industry body, has been abandoned and the structure of the Industry Research Council is under review. It seems likely that the comprehensive industry surveys, that commenced with the 1995 bench marking study and continued through 2003, are now a thing of the past.

Nevertheless, planning for the November 2004 World Congress and ISHS symposium in Melbourne is well advanced and overseas visitors for these events can be assured of a unique experience. Entapack will be there, helping make all overseas visitors feel welcome. We invite our overseas customers, and potential customers, to take this opportunity to inspect our facilities at Dandenong.

For further information about Conference and Symposium arrangements, you can contact Louis Chirnside of the Australian Processing Tomato Growers Group at Louis@worldtomatocongress.com.au


Best regards, Vincent


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