Montague looks to new markets to bear export fruit

26 October 2021

Victorian fruit grower Montague is rebuilding after a challenging 2020, when bushfires, pandemic lockdowns and trade disruptions hit its export business.

Montague acted quickly in the face of these challenges. The company used the International Freight Assistance Mechanism to rebuild supply chains to Asia. It is working with Austrade to explore new export opportunities in Japan and Korea. It is also forging ahead with plans to open an office in China, one of its most important markets.

Montague is also growing its Australian business. It bought a greenfield site near Shepparton to plant stone fruit. It also purchased a property outside Mildura, with 84 hectares of planted crops including table grapes and citrus fruit. It also opened a new processing facility in Narre Warren North in Victoria. The facility can process up to 260 million pieces of fruit a year. Montague has employed 150 full-time staff to work at the facility.

‘My grandfather, Bill, founded Montague in 1948,’ says Managing Director Scott Montague. ‘He’s now 95 and still sends us photos of our fruit in his local Coles. We’ve gone through bushfires, pandemic lockdowns, and export trade disruptions. Like many others, we’ve had a tough year.

‘But we have a clear strategy to expand our business for the future, both here in Australia and internationally – and it’s starting to bear fruit.’

IFAM and sea freight reconnects exports to Asia

Montague owns 500 hectares of apple, pear, citrus, grape, stone fruit and cherry orchards. The company also works with 80 growers across Australia. It supplies all the major supermarkets in Australia and exports to Asia and the UK. Scott, his father Ray, his brother Tim and his cousin Hamish are the company’s directors.

Montague relies on airfreight to transport stone fruit to Asia. When Australia closed its borders to contain COVID-19, commercial passenger flights dropped by more than 90% almost overnight.

Like other exporters, Montague turned to the Australian Government’s International Freight Assistance Mechanism (IFAM). This temporary, targeted, emergency support measure is keeping global air links open while the world responds to COVID-19. IFAM has reconnected 9 Australian ports to 58 international destinations since April 2020.

Montague uses IFAM to export stone fruit to China, Malaysia and Singapore. ‘Without IFAM ensuring that air links are kept open during the pandemic, airfreight would be virtually impossible for us,’ says Scott. ‘Airfreight delivery is over 50% of our stone fruit export business.’

Montague is also adapting to the new trade environment. It is using sea freight to export citrus to Vietnam and Korea.

‘We’ll put stone fruit on the water to China, Canada, Malaysia and Singapore,’ adds Scott. ‘Table grapes will also go by sea to China, Vietnam, Thailand, Korea, Indonesia, Malaysia and Singapore.

‘Sea freight is significantly cheaper per carton than airfreight. It is a viable option for us as long as vessel schedules are maintained.’

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New markets and new product categories to bear export fruit

Trade disruptions have highlighted the importance of market and product diversification. Apples and stone fruit have been the backbone of Montague’s export business for many years. It now wants to export more table grapes, citrus and cherries.

‘By exporting citrus and table grapes, we can get our brand and our premium-quality, Australian-grown products in front of customers all year long,’ says Scott.

Montague was interested in exporting table grapes and citrus to Korea. Austrade introduced the company to a Korean distributor in early 2021. As a result, Montague secured its first sale of citrus to Korea. The company is hoping to also sell table grapes in the upcoming season.

Montague and Austrade have a longstanding relationship. Austrade helped the company enter Thailand several years ago through an apple export program. Over the years, Montague and Austrade worked together to build the Montague brand and convert customers. Today, Montague supplies apples and summer fruit to Central Food Retail, Thailand’s largest supermarket chain. It is now looking to export table grapes and cherries to this market.

‘We’ve worked with Austrade for around 10 years,’ says Scott. ‘Austrade’s overseas teams have played an important role in our export expansion. We’re going to be deepening our relationship with the agency, using its resources to help us better meet the needs of overseas consumers.

‘Austrade is also assisting us to branch out into new markets, such as Japan and Korea, where we hope to export stone fruit.’

Canada is another country on its wish list. ‘We are doing some late-season plums to Canada,’ says Scott. ‘We’d like to open up the country to our world-class table grapes, plums, peaches and nectarines.’

Montague also sees good opportunities to grow existing markets. For instance, the company wants to start sending table grapes and cherries to Vietnam. It has been exporting citrus to the country for several years. Austrade has already introduced Montague to potential distributors. The company also wants to export stone fruit to Vietnam when market access becomes available.

Breeding new fruit varietals to improve competitive advantage

Montague has been developing fruit with flavour profiles to match Asian tastes for many years. The company started investing in fruit breeding programs about 15 years ago. It keeps some of the world’s best fruit genetics in a core group of growers.

‘Investing in new varietals and genetic innovation allows us to differentiate our fruit, particularly for export,’ says Scott. ‘We do this through our branding. We have CROC EGG plums and Montague Tree for nectarines, peaches, citrus and table grapes.

‘The stone fruit varietals are bigger, firmer, sweeter and crunchier than competitor products. Asian consumers prefer these varietals and associate our brand with these attributes.’

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Committing to China with a new office

China is an important market for Montague. It started exporting stone fruit to the country after the China-Australia FTA entered into force in 2015.

Trade disruptions affected exports in the 2020–21 summer fruit season. Despite this, Montague remains committed to China and believes there is significant room to grow.

In December 2021, the company will open its first office in China. It is partnering with a firm that has built the Montague brand for 5 years.

‘We want to invest in promoting our brand in China,’ says Scott. ‘There is a groundswell of acceptance for Australia’s clean, green produce in China. We are keen to increase our investment by fulfilling the demand for our fruit.’

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