We have been working now for three years to establish a new business to produce dehydrated vegetables. We believe, on the basis of a great deal of work, that such a business is viable in the Riverina and that it could lead to a whole new industry to replace imports and generate export income. Many of you will know that this idea has been looked into before, both in the Riverina and in South Australia, but there is not yet an operating plant in mainland Australia.
Rather than talk about viability, I would like to concentrate on the importance of research to the project's success. Our plant, starting with one dehydrator, has to compete with US factories with 19 parallel dehydrators. We are relying on research in three different areas to make the project competitive internationally. We are working with the Food Industry Development Centre at the University of NSW to extend storage life of fresh produce before drying, and to determine the optimum drying conditions. This work, over three years, is supported by the Horticultural Research and Development Corporation. We will also be working with NSW Agriculture to extend the work we have done in agronomy to other products.
Storage of Fresh Produce
The main product of the dehydration plant will be onion, and all our financial plans are based on producing mainly dried onion, and some garlic. To get down to import parity price, we have to extend our processing season as far as possible, and the way to do this is to store fresh onions. We can also extend the season by sourcing from South Australia and Queensland, but the freight costs are high.
The University of NSW is conducting storage trials to determine the optimum conditions for storing fresh onions in bulk, They are looking at the effects of different temperatures and humidities on the quality of the stored onions, as well as the effects of various pre-treatments before storage. They are measuring the quality of onions stored in the laboratory under different conditions in terms of rotting, sprouting, colour, total solids and pungency.
The results of this work are very important to the project. If we can safely store the onions for an extra month, we can spread our overheads and decrease our cost of production. Alternatively, we can avoid high-cost freight from interstate, or the even higher cost of cold storage. Equally importantly, we can control the quality of the input to the plant, which directly affects the all important quality of the output, especially with regard to colour and microbiological quality.
The University of NSW is also building a model of the dehydrator so that we can optimise the conditions within the dryer. Although the technology is not complex, the exact drying conditions are a closely guarded secret in the United States, and not even the dryer manufacturers know exactly what conditions are used in different plants. Obviously, we need to dry to a specified moisture content, and to do so with the lowest use of energy. But there is also a trade-off between moisture and colour, the principal quality parameter. This research has also demonstrated a trade-off between colour and pungency, which we believe can be used to our advantage in the market. Clearly, a good knowledge of dryer conditions will also benefit us in terms of plant efficiency at start-up time, and the elimination of substandard product.
This research is slow and time-consuming, but will be of direct benefit to the project. For instance, we are hopeful that the model may enable us to buy an Australian-made dryer instead of importing one, and still get top quality product quickly. It will also hopefully help us to quickly establish optimal conditions for drying other products whose physical characteristics are published, rather than having those like onion where we have to measure them. Lastly, it will help us produce a range of products to exact customer specifications. For instance, we think our onions may give us a competitive edge in satisfying flavour requirements better than our imported competition. An example of so-called "niche marketing".
We have already done a lot of work in agronomy for onions and garlic, but there is much more to be done. Processing onions must have the highest possible solids content, and we have improved in this area dramatically in the last few years. Further work is needed in testing different varieties and growing conditions, as well as harvesting and handling the product before processing or storage.
NSW Agriculture, in association with the HRDC and ourselves, plans to appoint a full-time agronomist to help with the selection of other products for the dehydrator. This work must include varietal selection and growing conditions, prices for the quantities we need, and research into the markets for other dried products. If we can produce even small quantities of high value dehydrated fruits, vegetables and herbs, the economics of the project will improve out of sight. Initially we can compete in this industry because of the quality of our produce and the efficiency of our farm operations, but we will need continued improvement and extension into other products through agronomic research.
You may well be wondering, after all this work, why we are not up and running. I guess we feel a bit the same way. We have certainly tried to do everything properly, and have planned and costed the project in great detail. This was good enough to convince a major financial institution to back us two years ago. However, we still need another partner, and have been unsuccessful in convincing another local or Australian business - preferably a food processor - to join us. Like many before us, we are now regrettably looking overseas for a partner to add value to our farm products. Meanwhile, the prospects of our project's success are improving from the research projects I have described to you.
I hope I will soon be able to tell you, in figures, how we succeeded.