Coles managing director John Durkan has announced long-term direct sourcing agreements with strawberry producers in Western Australia and Victoria, and a tomato grower in South Australia, in order to increase production and boost supplies for the Australian retailer.
Durkan told delegates at the Global Food Forum, co-hosted by The Australian on 15 April, that Coles was looking to increase its direct sourcing model that it first instigated seven years ago.
“We want more direct sourcing, we want to invest either in terms of tenure, or direct investment, or joint investment, in terms of those agricultural businesses, whether they are individuals, or whether they are corporates, and we want to grow behind them,” said Durkan.
The investments include providing covered cropping for two strawberry growers in Western Australia and Victoria in order to boost production and protect the crops from inclement weather.
Sundrop Farms in South Australia will also receive a boost from Coles, with the retailer co-investing in new state-of-the-art, carbon neutral greenhouse facilities to boost truss tomato production in Port Augusta.
"We can get truss tomatoes 365 days of the year … we've got a flat piece of dirt at the moment and we are going to build, with them, a state-of-the-art glasshouse facility, that will feed the Australian market in terms of truss tomatoes – because there is going to be a shortage of truss tomatoes in the future – there just isn't enough at the moment," Durkan said, adding that Coles wasn’t looking to overtake farming facilities, but rather invest in long-term contracts with growers. “
That will give us consistent pricing, low cost, highly productive facility that will enable us to give a great returns to the farmer, particularly this family; and two, plentiful supply; and three, low prices to consumers.”
Coles announced its investment in Sundrop’s 20ha greenhouse facility in December, along with the ten-year contract between Coles and Sundrop.