Avo prices drop, but orchards in high demand
Fund manager Gunn Agri Partners is among investors betting on a rebound in avocado prices in the coming years, after recovering more than $ 15 million from orchards in New South Wales and Queensland.
Avocado prices have fallen to just $ 1 each after harvesting a glut of fruit this season
The fall in prices did not deter farm asset manager Gunn Agri, who bought the Mountain Top avocado orchard just west of Nimbin in North New South Wales for $ 11 million to producers Barry and Vickie Kuhnell.
The 117 hectare property at 578 Mountain Top Road has more than 14,000 Hass avocados planted by the Kuhnells since they bought the property ten years ago. Two-thirds of orchards are over four years old – avocado trees take four to five years to start bearing fruit.
Gunn Agri paid $ 10.94 million for the Mountain Top orchard, with the deal going two weeks ago. Geoff Venn of LJ Hooker Lismore negotiated the sale, which included 2021 harvest reports www.commercialrealestate.com.au
Gunn Agri chief executive Bradley Wheaton said the property was acquired for a managed account known as Wollemi Farms.
âIt was purchased on behalf of a European institution mandated to invest in permanent agricultural assets in Australia, often leased to local operators,â Mr. Wheaton told the Australian Financial Review.
Hass avocados, which previously sold for up to $ 4 each, were selling for just $ 1 in supermarkets earlier this year after a bumper harvest in Queensland, the country’s main avocado growing region.
In Western Australia, 8.2 million trays will be picked up this summer, an increase of 233% from last year.
Despite the drop in commodity prices for avocados and macadamia nuts, Mildura-based Herron Todd White assessor Paul O’Keeffe said market conditions on New Wales’ north coast South remained favorable.
Mr O’Keeffe said farmland values ââwere firming, “fueled in part by buyers from the capital markets.”