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Issue 85: Challenges Faced by the Hydroponics Industry Worldwide

November/December – 2005
Author: Steven Carruthers

International Conference & Exhibition on Soilless Culture 2005
Fort Canning Gallery, Singapore, 5-10 September

Identifying the challenges faced by the hydroponics industry worldwide is like forecasting the future and requires some ‘strategic thinking’. In the business world, strategic thinking is a process whereby you learn how to make your business vision a reality by developing your abilities in team work, problem solving, and critical thinking. It is a tool used to help you confront change, plan for and make transitions, and envision new possibilities and opportunities. By engaging in some strategic thinking, I hope I can point to some of the challenges ahead for the hydroponics industry.

The sustainable development of the planet and the way we feed and clothe the population are major issues confronting the world today. As a global community, we need to advance our expertise in plant production, food technology, sustainable management of natural resources, as well as how we use the natural environment for recreational activities.

Agriculture and horticulture specialists will face some of the greatest challenges in the 21st century. They will need to assist in the supply of food and fibre products for a growing population that is expected to number 8.9 billion people by 2050 (USAID, 2004). The main challenge will be to supply safe products that are needed for a quality of life while maintaining a healthy planet.

Hydroponic and greenhouse technology, aquaculture and aquaponics, organic and urban farming technologies are intensive plant production systems that are all well placed to meet the challenges ahead. However, the growing systems of tomorrow will be vastly different to those used today. The present day systems, while a step in the right direction, are unsustainable and in the future it will be necessary to develop alternative production systems that are more efficient in terms of water, energy and labour use. Driving the challenges ahead are consumer and government pressures to produce safe, nutritious food in a way that is sustainable and does not harm the environment.

The new global economy and the advent of free trade agreements pose significant challenges for the hydroponics industry worldwide. Cheap products flooding international markets take away livelihoods, threaten the stability of existing fresh food markets, and increase the risk of exotic new pests and diseases establishing in countries where they previously didn’t exist, with serious impacts on important commercial crops and natural ecosystems.

The world is littered with accidental and inadvertent pest and disease introductions owing to bad grower practices, dubious Import Risk Assessments, inadequate management protocols and quarantine inspection failures. For example, the recent arrival of potato spindle virus in Western Australia had the potential to cripple the Australian greenhouse industry had it found its way into the green waste.

Fortunately, it was discovered early and eradicated. Other countries have not been so lucky. Pepino Mosaic Virus (PepMV), which was detected in greenhouse tomatoes in Europe a decade ago, has now appeared in North American greenhouse tomatoes. Other tomato diseases galloping across the globe that threaten commercial greenhouse industries include Tomato Yellow Leaf Curl Virus (TYLCV), which has jumped from Cuba to Florida, and now Morocco, and Tomato Infectious Chlorosis Virus (TICV), which was discovered in tomatoes in California, and has now turned up in Italy.

Closer to home, back in the early 1990’s, western flower thrips found its way into Australia and is now widespread and creating havoc, while more recently lettuce aphid originating from northern Europe, has found its way to New Zealand and brought that country’s lettuce industry to its knees. The lettuce aphid has since made its way to Tasmania, and was recently detected on the mainland, threatening Australia’s lettuce industry.

Quarantine issues will be major obstacles for free trade agreements in fresh food commodities between countries such as Australia and New Zealand that have strict import and food safety regulations. There will be increasing pressure on exporting countries for growers to meet the same exacting standards as Australian and New Zealand growers to ensure the food chain remains ‘clean and green’.

Operators of farming enterprises can no longer see their contribution as a ‘way of life’. They must operate their enterprises as a business, becoming aware of competition, and adapt accordingly. Globalisation is important as producers look to other parts of the world to export their products. As countries develop and more people become educated, the attentions of those people are turned towards ‘quality of life’ issues, which include the quality of the food they eat.

With the rising power of supermarket chains in developing countries replacing the traditional markets for fresh fruit and vegetables, demands are increasing for ‘clean and green’ produce. Consumers demand to know what pesticides and other chemicals have been used to produce their food. In the future, crops will need to be grown without the use of pesticides and fungicides.

Scientists and educators worldwide have responded to this challenge by developing alternative ways of managing pests and diseases in agricultural and horticultural products, such as Integrated Pest Management (IPM) and gene technology, also known as biotechnology.

A major challenge ahead for industry will be to grow crops with a minimal use of safe pesticides. This means developing more disease-resistant plant varieties, discovering a wider range of beneficial insects and other biological control agents, and developing management protocols to control pest and disease problems. Most countries still have a long way to go, including Australia. For example, while there are greater than 30 biological control agents routinely used against about 20 key pests by commercial greenhouse growers in Europe and North America, Australia has less than 10 against the same number of major pests. Strict import regulations means that Australian biocontrol researchers need to identify beneficial insects from within their own environment, and to rear them in commercial quantities at an economical price, a process that can take a decade or more once a prospective beneficial insect has been discovered as the industry can best be described as fledgling. Australia is making progress with the recent discovery of two native thrips predators, which are currently being commercialised for the Australian hydroponic and greenhouse industry. These beneficial insects may also have benefits for other horticultural sectors, especially where western flower thrips is a problem.

Biotechnology will play an important role in developing disease-resistant plant varieties. Gene technology is also being increasingly used to develop fresh food products high in beneficial nutrients that slow or prevent disease. For example, tomatoes are rich in lycopene, which is known to slow aging, prevent heart disease and reduce the risk of prostate cancer. Specialised tomatoes high in lycopene are now available in North America supermarkets. Biotechnology will be used to develop other food crops loaded with beneficial nutrients that promote good human health.

Although recent surveys show consumer sentiment against GM foods is moderating, the debate for and against genetically modified plants is still emotive. Genetically modified foods both attract and terrify us, but the reality is we have been genetically modifying food since two weed species were brought together to produce wheat. The Dutch currently use GM technologies to check the make-up of genes, which lets them advance their breeding selections that would otherwise take many years. GM technology makes plant breeding easier and quicker.

In the 21st century, biotechnology will play an increasing role to produce what is known as ‘functional’ foods. Genetically modified foods may also carry other useful components such as genes to vaccinate consumers against important diseases.

The quantity and quality of water available for farming and, for that matter, urban populations throughout the world, is an important issue. In Australia, water is a scarce resource – the continent is one of the driest in the world. Management of our water resources is paramount to the success of agricultural and horticultural enterprises. Australia can play an important part in determining the most efficient ways of using this resource. Issues such as salinity and water reuse are being confronted, and cooperation from users to policy-makers is being sought.

Hydroponic and greenhouse production systems are water-efficient. Comparative analyses of water consumption show that it takes 160,000 litres of water to produce AU$100 of cotton, compared to 600 litres (best practice) of water to produce AU$100 worth of hydroponically grown produce.

Table 1: Water use efficiencies

Agriculture Sector Litres of water per $100 of output
Rice – 470,000
Cotton – 160,000
Dairy Milk – 147,000
Sugar – 123,900
Beef Cattle – 81,200
Vegetables & Fruit – 37,900
Wheat & Grain – 24,500
Hydroponic Crops – 600

There is also a significant reduction in fertiliser wastage. Using closed systems that recycle more than 95% of the water used, the hydroponics and greenhouse industry has a recognised track record for low water use compared to other agricultural and horticultural sectors. Unfortunately, less than one-third of hydroponic production systems worldwide are closed with most growers still running to waste to minimise disease problems. The challenge for these growers is to modify their systems to recycling technology, and to adopt better practices to manage their crops. Of course, this will also increase the cost of capitalisation, but consumers have shown they are willing to pay a higher price for high quality, safe products.

The export of fresh fruits and vegetables throughout the world is increasing. The concern in Australia is that cheap imports don’t meet the same rigorous standards that Australian growers are required to meet. There is clear evidence some imported produce coming in has traces of dieldrin, DDT and cancer-causing organochlorides. There is also a concern about untreated organic waste such as night soil and pig waste being used as fertilisers on vegetables grown in countries such as China for export to Australia.

Industries and governments worldwide are highly concerned about food safety and the harmonisation of agricultural production systems with the environment, and production of future food in enclosed hydroponic production systems seems to offer many advantages. However, recognition and support by governments, or should I say the lack of recognition and support by governments, is a major impediment to the industry’s growth in many developed and developing countries.

Strategic thinking tells us we must look to the Netherlands as the best industry model in order to identify the challenges ahead for hydroponics worldwide. Holland has the most developed hydroponic and greenhouse industry in the world. However, the changing market environment has brought with it many challenges. Until 10 years ago, Dutch growers and their grower organisations under-estimated the dynamic power of the Spanish vegetable industry when it joined the European Community (EC). From 1992 to 1999, Spanish vegetable exports jumped 10% or more per annum. At the same time, the market was changing from a producer-orientated market, where the produce was presented by the producer, to a demand-orientated market in response to the rising power of supermarkets. It has taken a difficult decade for Dutch growers to fight their way back to market dominance.

Under the Dutch auction system, Dutch growers were unable to meet the new market demands until around the mid 1990’s. The Dutch auction system meant supermarkets could only buy uniform products in uniform packaging for a daily changing price that was about the same for every buyer. Spanish producers/exporters were much more flexible, had better packing facilities, and had more direct contact with their clients.

There are many similarities between Spain and Mexico as the cheap producing countries for their northern markets. US and Canadian growers have had to deal with the fast-growing imports from Mexico. In the Asia-Pacific region, Australia is under siege from cheap imported vegetables from China.

The smashing Spanish success of the 1990’s had its origin in good climate conditions, growing long-life tomatoes to acceptable quality using cheap growing techniques in plastic greenhouses and cheap labour. The growing season was also longer. The much lower cost of production compared to Holland, combined with large EU subsidies and the constant devaluation of the Spanish peseta, also made for cheaper Spanish exports.

In 1996, most vegetable auctions in Holland united under Greenery International with the objective of changing the traditional auction system to one where growers are able to influence the selling policy and prices. Those that didn’t join Greenery formed grower associations that sold their own products under specific marketing brands of tomatoes, peppers, cucumbers and eggplant. These groups were the first to introduce ‘tracing and tracking’ and are still the most active in the market.

A third group of Dutch growers made delivery arrangements with large exporters on a yearly basis. Some of these exporters also formed grower associations to take advantage of EU subsidies for marketing activities.

As a consequence of the European over-production, Dutch growers and exporters searched for new products and far away markets. Rather than focusing on long-shelf life, they started breeding for taste, which led to the development of ‘truss’ or ‘cluster’ tomatoes and coloured peppers now present in North American and Japanese markets. The improved ‘clean and green’ image of Dutch products using Integrated Pest Management strategies has put pressure on Spanish imports, which are now seen to be not so careful with Ag chemicals.

Since 1996, Dutch growers and exporters have developed fixed relationships with clients. By decreasing the number of links in the chain, costs have been reduced. Production costs have also been reduced by enlarging the scale of greenhouse production with improvements in energy consumption. Canada, the US, Australia and New Zealand have followed the European trend to enlarge greenhouse operations to supply high quality truss tomatoes to supermarkets all year-round. In Australia, the major growers and wholesalers have formed strategic alliances to spread production over a wide climatic zone to guarantee reliable supply to the important east-coast markets all year-round.

Today, many independent grower associations and groups in the Netherlands have since joined Greenery International. While Dutch growers are more divided than before, they still co-operate in exchanging information and experience. Research is no longer supported by government, but funded by grower groups. The Dutch financing infrastructure is good, and specialised banks understand the vegetable sector and stimulate growth with investments. Dutch growers are now able to meet the requirements of the most demanding European supermarkets. They are also more flexible with year-round and last minute delivery, high quality standards, safe food, certification and ‘tracing and tracking’.

However, there are still many challenges ahead for the Dutch industry. Cost price is still high and productivity increases only by high investments. Dutch growers are also hindered by many rules and regulations imposed on them by the Dutch government and the EU. And of course, with a shortage of locations to build new greenhouses, there is a need to re-organise older greenhouses.

After a decade of reorganisation and redirections, the Dutch greenhouse vegetable industry is on its way back to the top. While Spain still has lower production costs, growers now need to invest in better technology and knowledge to meet the increasing market requirements demanded by supermarkets. This will drive their production costs upward as they feel the threat of cheaper imports from Morocco and Turkey once they have free access to the EU markets. Turkey and Morocco have similar climate conditions to Spain, they have significant low-tech greenhouse industries, and are working hard to meet the requirements to enter the EU. Like the Dutch a decade earlier, it’s now up to Spain to change its direction. Unless Spanish growers change, they will not be able to distinguish their product from the cheaper imports from Morocco or Turkey.

As a global industry, countries with developed hydroponic and greenhouse industries need to share aspects of their technology with less developed countries to produce safe fruits and vegetables in sustainable growing systems. Investments in high technology greenhouses in Spain by Dutch organisations, and similar investments in the Mexican greenhouse industry by Canadian and US growers to fill seasonal gaps in high quality tomato products, points the way for investment opportunities for Australian and New Zealand industry stakeholders to share their technology with less developed industries in Asia.

So, the challenge ahead for hydroponic growers worldwide is to develop water-efficient, sustainable growing systems to supply high quality, safe products that are needed for a quality of life while maintaining a healthy planet. To achieve this goal, the hydroponics industry worldwide needs to:

– adopt recycling technology which offsets the need for soil, water and energy to produce crops and dramatically reduce natural resource use;
– develop new sustainable pest and disease control practices, without pesticides and fungicides;
– invest in food technology research, including biotechnology;
– develop more efficient production systems with smaller footprints and demands on natural resources;
– develop better greenhouse designs and construction materials that optimise climate control;
– invest in renewable energy resources, such as the development of cheaper plastic solar cells;
– encourage industry recognition and support by governments; share technology with less developed hydroponic and greenhouse industries, and.
– develop market access for ‘clean and green’ products.

Leanne Griffin,
Challenging times for vegetable growers
Australian Vegetable Review 2005, AUSVEG.

Roberta Cook,
Emerging Hothouse Industry Poses Challenges for California’s Fresh Tomato Industry
Giannini Foundation of Agricultural Economics, University of California, Davis.

Dr Mike Nichols,
Greenhouse Designs and Function in the Future
8th Biennial Conference of the Australian Hydroponic & Greenhouse Association (AHGA), Bundaberg, 2005.

Dr Mike Nichols,
Genetically Modified Foods
Practical Hydroponics & Greenhouses, January/February 2005, Issue 80.

Louise Jackson,
Horticulture and Sustainable Food Systems
Dept. of Land, Air and Water Resources, University of California, Davis, 2004.

Bob Johnson,
Hydroponic Hurrah: Popularity is growing for produce grown without soil
Vegetable Production and Marketing News, Texas

Agricultural Extension Service
The Texas A&M University System, College Station, Texas, 2005.

Dr Ian Porter,
Impact of global market drivers on the future role of hydroponics in world food production
Hydroponics Farmers Federation Conference, Bendigo, Victoria, July 2004.

Dan Cantliffe and John Vansickle,
Mexican Competition: Now from the Greenhouse
Food and Resource Economics, University of Florida, Gainesville, 2004.

Joe Elbustani,
Science tackles problems for the greenhouse industry
Australian Vegetable Review 2005, AUSVEG 2005

Gerard F.J.
Significant changes in the European greenhouse vegetable industry
Boonekamp (Editor Weekblad Groenten & Fruit),
Canadian Greenhouse Conference, Toronto, Canada, 9 October 2004.

US Agency for International Development (USAID).

About the author
Steven Carruthers is the Managing Editor of Practical Hydroponics & Greenhouses, a bi-monthly magazine published in Sydney, Australia, and Vice-President of the Australian Hydroponics & Greenhouse Association (AHGA), Australia’s peak industry body. Steven is the recipient of the Australian Business and Specialist Publishers Association (ABSP) Bell Award for ‘Best Small Publisher of the Year’ in 1998, 2000 and 2001 and was highly commended in 1999. Practical Hydroponics & Greenhouses is the recipient of the ABSP’s Bell Award for ‘Best Specialist Magazine of the Year’ in 2000 and 2001. Steven is also an affiliated member of the International Federation of the Periodical Press and author of several books including the bestseller, Hydroponic Gardening published by Lothian Press.

Issue 76: Setting New Benchmarks

May/June – 2004
Author: Steven Carruthers

Flavorite takes another bold step to consolidate its position as the leader in the Australian hydroponic tomato industry.

The Flavorite story really began in 1988 when Mark Millis, an existing tomato grower, teamed up with Warren Nichols, an experienced marketer of fresh fruit and vegetables, to grow hydroponic tomatoes at Warragul, in the heart of Victoria’s Gippsland, about 100 kilometres from Melbourne. At the time, there were only three growers in Victoria producing hydroponic tomatoes.

Mark and Warren realised early on that there was a growing demand for red, flavoursome tomatoes. They felt field-grown tomatoes that were picked green and ripened with CO2 in cool rooms weren’t meeting the demand from customers. Faced with this challenge, they set out with a vision to grow a juicy red tomato with good appearance and flavour that would become the Flavorite hallmark.

In the beginning, there were 3,000 square metres of tomatoes on the farm. In its first year, the farm produced 80 tonnes of tomatoes worth $240,000. Today, the farm has expanded to accommodate more than 60,000 square metres of plants, and in the 2004 season, Flavorite’s turnover is expected to exceed $20 million for the first time. This milestone will be made possible by the commission of a new 2ha cutting edge glasshouse facility at Warragul, the largest of its kind in Australia, and a 2ha polyhouse in Bundaberg with marketing partners HMG (Horticultural Management Group), to expand the southern winter markets and keep tomatoes more affordable during the cooler months.

HMG has invested an initial $5 million into its Bundaberg site, which will see the expansion of the site increase from 13,000sqm to 33,000sqm, with a state-of-the-art packhouse attached. Flavorite will exclusively market the fruit produced from this agreement, as well as provide technical advice in the greenhouse and packing shed. HMG has adopted the high standards of Flavorite to produce both truss and premium single tomatoes to the exacting Flavorite quality specification.

Chris O’Connor of HMG said that the reason HMG were prepared to align themselves exclusively with Flavorite, was due to the commitment that Warren Nichols and Mark Millis had to the industry. The fact that Flavorite has a long-term industry vision, focused on quality, and is a significant grower in their own right, vertically integrated, with direct contact to the supermarkets and wholesale markets, removed many of the business risks for HMG.

The ongoing significance of the partnership lies in the commitment of HMG to invest a further $10 million over the next five years to increase the Bundaberg greenhouse area to around 100,000sqm.

Grower synergies
Flavorite not only grow their own tomatoes, but pack and market single and truss tomatoes for many leading growers located throughout Australia who meet the strict Flavorite quality specifications. “Other growers provide 50% of the product to the famous Flavorite brand,” Mark Millis told his audience of more than 400 growers, industry specialist, community business leaders and Flavorite staff who had gathered for the official glasshouse opening. “They’ve grown with us, and they make a big contribution to the development of our company,” he acknowledged.

These affiliated growers benefit from marketing under the famous Flavorite brand, which has become a quality trademark for premium tomatoes throughout Australia.

The Warragul site includes a newly renovated packing shed, which has increased Flavorite’s packing capacity three-fold. The new grading line incorporates an automatic conveyor belt system with recording facilities for date stamping, grower coding and labelling.

Flavorite also pack trusses or bunches of tomatoes into pre-packs, which the company introduced into the market 18 months ago. “There’s a big swing to them mainly because of the actual way that a truss ripens itself, from the top of the truss down,” said Flavorite Sales Manager, Caleb Rudd.

Pre-packed truss tomatoes also have other benefits. Prior to the advent of tamper resistant pre-packs, consumers would often separate single tomatoes from the stem with only around 40% of truss tomatoes going through the register. “Since the introduction of Flavorite pre-packs, the scan rate is about 98%,” said Caleb.

Pre-packs also eliminate product bruising from excessive handling. Arie Baedle, the principal of Rijk Zwaan Seeds, said that growers need to really take note of what the green stem means. “From research around the world, we know that with every handling, a tomato will immediately lose flavour and shelf-life. Therefore, the green stem is the buyer guarantee that the tomato has been carefully handled, that it has full flavour, and it tells the consumer it is a greenhouse grown hydroponic tomato,” said Arie.

New Glasshouse facility
The new glasshouse is a significant building in many ways, and represents a coming of age for the Australian greenhouse industry.

“It’s a quantum leap forward in tomato production capabilities,” said Mark Millis .

“It shows that we can create buildings that can cost-effectively produce tomatoes to meet the demand that’s growing in the marketplace. He added that the new glasshouse would force Flavorite competitors to make similar investments, and he welcomed the challenge.

“The industry can only benefit from having more quality production,” he said. “This building is going to spawn more buildings like it, and it’s going to happen quickly as other growers and investors understand its capabilities,” he predicted.

The new glasshouse is significant because of the technology that’s involved in it. The glasshouse includes the latest irrigation and fertigation equipment, a cost-effective natural gas heating system that includes CO2 extraction to increase plant yields, and a computer system that automatically opens and closes roof vents, activates internal misting, or covers the crop with thermal/shade covers to maintain optimum growing conditions inside the glasshouse. In extreme heat conditions, the computer will also activate sprinklers on the roof to cool the inside environment.

Designed and installed by Faber Glasshouses Australia, the 2ha (19, 840sqm) building took around eight weeks to complete. Constructed from steel, aluminium and toughened glass, the building has a gutter height from 5 to 5.1 metres, measured from the underside of the gutters, with a typical Venlo-style roof ventilation system of 20%.

“The height of the greenhouse is important to create an even air buffer above the whole crop,” said Faber Glasshouse Australia Managing Director, George Jonker. “The air buffer will ensure that temperature fluctuations are handled in such a way as to prevent the crop from stressing.”

Mr Jonker said that the height of the greenhouse is only one part of a combination of design features and other equipment that are arranged in such a way to benefit plant production and minimise the risk of crop damage from excessive environmental changes. The glasshouse is fitted with the latest environmental control technology, including thermal/shade screens above the plants that automatically cover and uncover the crop (depending on solar radiation) to maintain optimum growing conditions. Automatic misting outlets are located below the thermal/shade screens, should they be called upon to cool the glasshouse down, or increase humidity. Temperature, light and humidity sensors located throughout the glasshouse constantly feed information back to the ‘Integral’ computer system that maintains optimum growing conditions.

Hanging gutter growing system
The hanging gutter hydroponic system is also an integral part of the new Flavorite production system that delivers product 365 days of the year all over Australia. According to Vaughn Pearce, Managing Director of Agrihort Irrigation Systems, the hanging gutters produce a higher crop yield compared to hydroponic growing systems on the ground. Agrihort Irrigation Systems were contracted by Flavorite to design and install the growing system now popularly used in Europe to grow hydroponic tomatoes.

Mr Pearce attributes the increased tomato yield to better air flow around plants, and better light penetration in winter.

“The benefits of the hanging gutter are increased production as a result of disease reduction through better ventilation around the crop, as well as excellent drainage control. When you combine this with production increases from interplanting, the results are undeniable, ” said Mr Pearce.

Another strong benefit of the hanging gutter is the convenient height for workers to manage the crop.

During the colder months, heating pipes on the ground, that double as trolley rails, radiate their warmth upwards through the crop as warm air rises. Barely visible under the hanging gutters are plastic ducts which run horizontally down each row, enriching the environment around the plants with CO2 extracted from the natural gas-fuelled boiler.

Cultural information
With a planting density of three plants per square metre, the new facility houses 50,000 tomato plants. The life of a plant is between nine to 12 months and each plant will produce 20 to 25kg of tomatoes. Over a 12-month period, the new glasshouse is expected to yield an average of 20kg per square metre more of fruit than twin-skin plastic greenhouses.

Predominately, Flavorite grow the ‘Tradiro’ and ‘Conchita’ tomato varieties. Tradiro has been noted for its robustness and good flavour during most seasons. To ensure the best tasting varieties are available, Flavorite is continually trialling new varieties. Current experimental varieties include ‘Clarence’ and ‘Labell’ tomatoes. All these varieties are available from RijkZwaan seeds.

Seeds are started in Grodan rockwool cubes in the on-site propagating hothouse for three days at 29°C at 100% humidity until germination takes place. Once the plant develops its first set of leaves, it is placed in a larger rockwool block and grown to the first flowering stage before planting out into the 2ha glasshouse on rockwool slabs. The plant is then supplied with a dripper, which will provide water and nutrients for the rest of its life.

During their lives, plants grow to 10-12 metres in length and are wound onto string hanging from wire in the roof of the glasshouse. This allows plenty of air and sunshine, which enables Flavorite to nurture and develop premium grade tomatoes. Crop management practices include layering and interplanting techniques, made easier by the hanging gutter system that allows plenty of light and air for young plants to develop. Each plant is closely monitored to ensure its nutrient and environmental requirements are met. Computers control the environment, watering, humidity and heating, but the human ‘green finger’ touch is never far away. Plants are hand-pollinated with vibrators three times weekly (Monday, Wednesday and Friday), and tomatoes are harvested daily.

The IPM program consists of the whitefly parasitoid (Encarsia formosa), and sulphur powder sprinkled on the floor as a disease preventation measure. Reflecting current European practices, after deleafing, debris is left on the floor under the hanging gutters, out of the way, between the heating pipes. Once considered a bad management practice, in some circumstances, plant debris makes an ideal habitat for re-emerging whitefly parasitoid.

According to NSWAgriculture Senior Research Scientist, Dr Stephen Goodwin, the plant debris will dry out from the nearby heating pipes, and does not pose a serious disease risk. However, he doesn’t recommend this practice if the debris is allowed to remain moist.

Future developments
Spearheading Flavorite into the future is Executive Grower Horst Sjostedt, a hydroponic grower with 35 years’ experience. Horst has extensive experience in large operations growing tomatoes in Colorado (USA), Portugal, and his home country of Sweden. As part of Grodan’s top 20 grower list, Horst recently returned from Italy, bringing back the latest information on growing varieties and marketing that will influence Flavorite’s ongoing development.

The Flavorite site at Warragul employs 150 skilled and semi-skilled full-time workers, with another 30-35 sales and marketing staff located at the Melbourne wholesale markets. Mr Millis announced work would begin on a second 2ha glasshouse in early 2005, offering more skilled job opportunities for the Gippsland region. To help meet the future skills base, Flavorite offer training programs in horticulture and packaging for its staff, affiliated growers, and students from nearby McMillan Campus.

“When we came to Warragul, unemployment was just over 20%,” said Mark Millis. “Currently, it’s just under 5% and this year Flavorite will put $4 million in wages into the local community.”

Looking to the future, Mr Millis said there are career paths in management and irrigation, and such careers are available to all Flavorite staff.

In the space of a decade, Flavorite has become Australia’s largest greenhouse tomato production, packaging and marketing business, and a significant employer of skilled and semi-skilled workers, not only in the Gippsland region, but also throughout Australia. From the beginning, the Flavorite brand has built its reputation on a juicy red, flavoursome tomato with a long shelf-life, that hasn’t been picked green and gas-ripened in cool rooms.

While the new state-of-the-art glasshouse is the largest of its kind inAustralia, it’s small by international standards, but it does represent a significant step forward for the Australian hydroponic and greenhouse industry. By comparison, the New Zealand tomato industry made the move to higher technology much earlier than Australia, with Faber Glasshouses the main structures used by large-scale operators. The largest Faber glasshouse facility in New Zealand is about 23ha, and still expanding.

With the construction of Australia’s largest automated glasshouse to grow tomatoes, Mark Millis and Warren Nichols have recognised that Australian growers need to look at tomato growing as a production line with the whole operation streamlined like a factory. This is being driven by the big food chains and other large companies that demand large quantities of high quality fresh fruit, vegetables, flowers and fish. Another important influence driving the change in the way we grow fruits and vegetables is Occupational Health & Safety (OH&S) issues, which are forcing growers to change to higher technology to become more efficient and profitable.

Flavorite is the firstAustralian business in the hydroponic and greenhouse industry to make the inevitable move to higher technology to match world production standards. To achieve its vision, the company has adopted the European way of doing business by working collaboratively with industry experts, from Australia and overseas, and with other growers to produce premium quality product. The geographical spread of Flavorite growers will allow the business to market high quality tomatoes all year round.

By 2020, the Flavorite vision tells us that over half of Australia’s tomatoes will be grown in glasshouses, generating sales of over $200 million and creating many thousands of jobs throughout Australia. Starting with this new glasshouse facility, Flavorite plans to lead the Australian industry forward in the new technological age of growing high quality hydroponic tomatoes for the growing market. The long term Flavorite vision is to build another 20ha of glasshouses next to the existing Warragul site.

As the industry continues to develop, Flavorite should not only be congratulated for creating a vibrant new industry in the Gippsland region, but also for raising the bar and setting new benchmarks for the Australian Hydroponics and Greenhouse industry.

For further information contact:
Flavorite Hydroponic Tomatoes
POBox 739, Warragul, Vic 3820

Issue 73: Retail Industry Reforms

November/December – 2003
Author: Christine Paul

The hydroponic retail industry has played an important role in the industry’s development, a wellspring for many of today’s commercial growers, and a supply network for many home gardeners who want to grow their own pesticide-free vegetables using water-efficient and environmentally friendly technologies. However, hydroponic retailers need to change some of their business practices if they are to play an ongoing role in the future development of this economically important industry.

Hydroponic retailers need to change their language succeed in attracting genuine home gardeners. This and some of their business practices if they are to was the message delivered by Australian Hydroponic & Greenhouse Association (AHGA) Vice President and Managing Editor of PH&G, Steven Carruthers, at the recent hydroponic retail workshops held in Adelaide and Perth. The workshops, the first in a nationwide series, were sponsored by the AHGA, which plans to introduce a National Code of Conduct and a Retail Industry Development Plan for hydroponic retail members.

The need for change
In the first part of his workshop presentation, Mr Carruthers traced the evolving face of the hydroponic retail industry in Australia. He said that in just over a decade, the market had grown from a handful of outlets to more than 400 specialist stores Australia-wide at its peak in the late 1990’s.

“In the early days, store owners focused on the home garden market, but as the retail industry grew, it became obvious it was also attracting a large cannabis-growing market,” said Mr Carruthers. “To a large extent, early SA and ACT legislation decriminalising cannabis for personal use, and rapidly evolving hydroponics technology worldwide, contributed to the explosion of stores, ” he added.

Today, Mr Carruthers estimates there are less than 200 specialist hydroponic stores Australia-wide with combined sales of around $120 million per annum at the retail counter. He attributes this market down-sizing to bad retail management practices and a changing legislative environment. “Hydroponic retailers are shop fronts to the industry, and they need to change their language and some of their business practices if they want to attract genuine home gardeners,” he said.

Mr Carruthers added that new legislation in SA, which makes it a serious offence to grow cannabis plants hydroponically, and WA where it will soon become an offence to ‘knowingly’ sell equipment that will be used to grow cannabis, is a serious wake-up call for all hydroponic retailers to change their business practices if they want to avoid further restrictive legislation.

“For the retail industry to grow and prosper, it needs to dissociate from its cannabis culture and promote its products and services to genuine home gardeners,” he said. “Changing the public’s perception of the hydroponic retail market won’t happen overnight, but the first step forward is through industry self-regulation,” he added.

Retail Industry Code of Conduct
Referring to key points in the SA Proposal to License Hydroponic Equipment Retailers (Report of the Review Panel: Executive Summary and Recommendations – January 2002), and the minutes of the Legislative Council of Western Australia Hansard (10/09/03), Mr Carruthers said both documents make it clear legislators in SA and WA want the hydroponic retail industry to work within a Code of Conduct.

“It’s something governments throughout Australia want to see – that is, industries developing Codes of Practice that minimise government regulations and administration costs,” said Mr Carruthers. “Not to develop a Code of Conduct in the hydroponic retail industry is to invite further legislation and business restrictions that could ultimately spell the demise of the hydroponic retail sector in this country,” he said.

The first item in the Code of Conduct proposed by the AHGA requires hydroponic retailers to undertake appropriate training and certification in the correct use, handling and storage of all chemical products, including pesticides and herbicides. Mr Carruthers warned retailers that the industry anticipates tightening of Federal and State legislation on the sale, handling and storage of agricultural chemicals that can be used to make explosives or for acts of bioterrorism, as well as compromise homegrown food safety and the environment.

“In the near future, we are likely to see new legislation that requires a permit and user identification to buy and sell agricultural chemicals, and industry members from growers to retailers will need to be certified in their safe handling and storage;not only because of terrorist threats, but also because of Occupational, Health and Safety issues,” said Mr Carruthers.

Mr Robin Moseby from Soladome Hydroponics was one of several retailers who welcomed the idea of training and certification in farm chemical safety. Currently, Mr Moseby is working on a suitable pathway for retailer training, which will be tied to units of competency under the National Training Scheme. He is planning a half-day course, which all retail staff are encouraged to attend, and which will offer a brief outline of farm chemical safety for a nominal cost. This will be followed by a full-day course, which all retail staff are encouraged to attend, but mandatory for supervisory staff, store managers, and store owners. This will complete the minimum certification required at a cost of around $250 per person. Mr Moseby suggested that the AHGA could provide valuable input to existing materials for further courses that can count towards a suitable diploma in hydroponic/horticultural management. It is envisaged that once a National course has been developed, it could be delivered to retailers in other States by other Registered Training Organisations under a licence arrangement for the use of the materials developed.

Legislative issues
In relation to items in the proposed Code of Conduct which prohibit products linked to cannabis cultivation being sold or advertised by member retailers, Mr Carruthers pointed to comments made by Mr Simon O’Brien (Lib) in the WA Parliament, which highlight bad practices in the industry. After viewing a retail product catalogue called The Growers Bible, the Shadow Minister for DrugStrategy said it refers to undetectable growing systems.

“Why would people need an undetectable growing system made to look like a refrigerator?” he questioned. “The catalogue is quite hilarious, ” he added, “in some ways because of the way its authors try to make it absolutely clear that they are appealing to cannabis growers, while at the same time desperately trying to disguise the fact. It is a curious contradiction, ” he said.

Mr Carruthers said the main threat to the SA and WA hydroponic retail industry is further restrictive legislation. He pointed to remarks made by Mr O’Brien in the WA Parliament about retail ‘cowboys’ who have no place in the industry, and deserve no consideration. “If the WA Liberals win government at the next State election, watch out for changes he initiates if nothing has changed,” warned Mr Carruthers.

“WA Labor may wait like the South Australian Government, but eventually more action will be taken in both States if hydroponic retailers do not take urgent action to reform their business practices, and dissociate from the cannabis culture.”

Retail Industry Development Plan
The second part of the workshop focused on common areas where a national network of hydroponic retail outlets could benefit the industry, home gardeners and the community, at the same time helping to turn around the public’s perception of the retail industry. Mr Carruthers told retailers that few organi-sations can succeed without a plan, and he recommended that retailers develop a Retail Industry Development Plan to take the industry into the future.

“A Retail Industry Development Plan could look at the concept of an annual ‘National Garden Safe Day’, for example, where a national network of hydroponic stores become collection points for garden chemicals, including unused pesticides, insecticides, and other out-of-date garden products.” Mr Carruthers said that many home gardeners are water wasters and major contributors to groundwater contamination in urban environments.

“One day they will pass a law banning lawns that are an unnecessary waste of water in this country,” he said. “It’s all very well pointing the finger at commercial growers polluting the groundwater as a consequence of fertiliser run-off;what about the tonnes of fertilisers and pesticides used on gardens in urban Australia, ” he added. “Hydroponic retailers can play an important role to educate the gardening public about water conservation strategies and safe gardening practices that don’t pollute the environment,” he said.

Mr Carruthers pointed to other issues where hydroponic retailers could take a leading role, such as collecting HID lamps which contain sodium and mercury, and plastic containers used to bottle nutrient products. He forecast that the day is rapidly approaching where manufacturers, retailers and consumers will need to pay an environmental levy to dispose of their waste packaging.

Mr Carruthers said that such industry initiatives are not difficult to plan and implement. Water conservation, groundwater contamination and pesticide use are issues that resonate with home gardeners and consumers more than ever. “Hydroponic retailers can play an important role to draw attention to these environmental issues, which are opportunities to turn around the public’s perception of the hydroponic retail industry,” he said

During the Adelaide and Perth workshops, and the rest of the planned workshops in capital cities around Australia, the message is loud and clear – it’s time for hydroponic retailers to re-evaluate some of their business practices and present a clean image of their industry.

“There is a large number of hydroponic retailers who supply a genuine home garden market, and I’m optimistic that these retailers will carry the industry forward to play an important role in the future development of urban agriculture using water-efficient and environmentally friendly growing technologies, ” said Mr Carruthers.

At the conclusion of the workshop, retailers were encouraged to adopt the proposed AHGA Code of Conduct, and to convey this and a Retail Industry Development Plan to their Parliamentarians at the earliest possible opportunity to demonstrate they are serious about reforming their industry.  Ω

PH&G November/December 2003 / Issue 73