By Brett Cole
Select Harvests Ltd has $25 million to spend on acquiring almond farms in South Australia’s Riverland region, Victoria’s Mallee and the New South Wales’ Riverina, as global demand for the nuts increases faster than supply.
“It’s a good time to look to expand the business,” Select Harvests managing director Paul Thompson told DataRoom. “It takes seven years for a tree to mature while global demand is increasing at 4 per cent per annum”
Thompson says the company could “comfortably” acquire 3,000 additional acres of almond farms while the cost impact of such acquisitions would be “minimal”. Select Harvests’ processing plant in Robinvale, Victoria is running at 70 per cent capacity, making the company eager to fill the spare capacity with additional product, he says.
The profile of potential acquisitions would probably be almond farms whose current owners want to sell as their children do not want to work the land, says Thompson.
Australia is the second biggest almond producer in the world but is dwarfed by the US, which accounts for 80 per cent of total global production. But a drought in the US that has damaged its almond industry has given Australian almond producers an opportunity to expand their market share.