Sweet outlook for Australian berries

The increase in incoming production will fuel the growth of the Australian berry industry.

A new report from ANZ has forecast a positive long-term outlook for the Australian berry industry as production volumes grow.

Madeleine Swan, ANZ director of food, drink and agribusiness insights, said the Australian berry industry has undergone a period of significant growth in recent years.

"While exports have shown strong growth, domestic consumption remains the main market with more than 95 percent market share," Swan said.

“The growth in production has made berries more available on supermarket shelves, however it has also had the long-term impact of driving prices down as supply catches up with demand,” Swan said.

The agricultural commodity report said that with new production capacity of around 12 percent of total current production expected to come to fruition in the coming years, developing new market access opportunities remains crucial for the value proposition of the berry industry.

The industry has a strong domestic market to supply with around 75 per cent of Australian consumers buying fresh berries and the majority buying multiples.

“On average, the Australian consumer buys almost 4kg of berries a year. As a result of increased domestic demand, prices have started to moderate slightly with both strawberry and blueberry prices showing less seasonal volatility,” Swan said.

“Having said that, recent flooding and international supply chain delays have contributed to a rise in food prices across the board, including berries, with recent flooding in Queensland and New South Wales affecting blueberry production and forced prices up.

Covid-19 has also challenged the industry and the effects of the pandemic are far from over, however the long-term outlook remains promising.

“Labor shortage issues during the Covid lockdowns have also put upward pressure on the cost of production as growers struggle to attract and retain skilled labor,” said Swan.

“However, the clear macro trend in the Australian berry industry is increased supply and increased investment in production capacity, putting downward pressure on prices.”

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