Embattled processor, SPC Ardmona, says its future looks sunnier than ever thanks to a five year, $70 million deal with Woolworths that will see an extra 24,000 tonnes of fruit, tomatoes and navy beans sourced locally.
From 2015, SPC Ardmona will begin supplying all fruit for Woolworths Select fruit snacks and jelly snacks, and for the next five years, will continue to supply 100 per cent of fruit for the Woolworths Select Multi-serve fruit range.
The processor will also supply a new range of Woolworths Select and SPC Canned Tomatoes that will be available in stores in October.
The partnership will see the two companies work together to establish ways to innovate and increase sales of products, according to SPC Ardmona, and builds on another deal with the retailer that was announced last year to sell 100 per cent Australian and SPC sourced apricots, peaches, apples and pears under the Select brand.
According to SPC Ardmona, the additional volume generated by this latest deal will require the equivalent of 86,000 fruit trees in the Goulburn Valley and will also triple the tonnage over the next five years of Australian grown tomatoes that SPC supplies to Woolworths.
"Woolworths has really embraced the fact that Aussie consumers are demanding more and more home-grown products," SPC MD Peter Kelly said. "Consumers really do care where their food comes from.”
Kelly said SPC Ardmona had recently seen a massive surge in sales as more Australians opted to get behind local companies and buy Australian made and grown products. He said this was partly driven by a grass roots #SPC Sunday twitter campaign which was initiated by a Newcastle consumer, Linda Drummond.
"In Woolworths alone, we’ve seen a 60 per cent increase in sales of SPC fruit in the first two months of this year so we’re hoping this will continue and move to our other great brands like Taylor’s Soups and sauces, IXL Jam and Goulburn Valley," he said. "We are very grateful for the unprecedented loyalty being shown for our brands from everyday Australian consumers."
Kelly also said that given SPC Ardmona is making big investment in innovation, with its recently announced $100 million capital investment package from the Victorian Government and parent company Coca-Cola Amatil, this latest long-term partnership was very welcome news.
According to Kelly, the agreement with Woolworths would start to help repair the major decline in SPC’s profitability caused by illegal dumping, unfair tariffs and the strong Australian dollar over a long period.
He also said that the deal gave growers certainty to start rebuilding their capacity.
"The share of Australian tomatoes has declined 67 per cent in the last ten years. SPC’s new partnership with Woolworths means the tonnage of Australian grown tomatoes will triple over the next five years which will help resurrect our tomato industry so it’s a particularly great day for tomato growers,” Kelly said.
AUSVEG spokesperson, Hugh Gurney said the deal is a huge win for Australian fruit and vegetable growers who have seen vegetable processing plants shutting their doors in droves.
“We hope that initiatives like this deal will help to mitigate the devastating toll that cheaply produced dumped foreign product has taken on our growers and processors,” said Gurney.
He noted that the deal follows similar recent contracts between vegetable processor Simplot and major supermarkets Woolworths and Coles, who are now sourcing 100 per cent of their respective Select and Smart Buy frozen vegetable lines from Australian growers. ALDI also sources its 825g canned fruit range from SPC.
“It is great to see retailers responding to the demands of Australian families to see more locally grown product on their shelves and on their dinner tables,” Gurney said.
SPC Ardmona says sales growth was helped along by a grass roots twitter campaign that was initiated by a Newcastle consumer.
