13/08/2008 - 22:00

Frankland sale to boost Jingilli push

13/08/2008 - 22:00

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The past two years has been a period of upheaval for the Western Australian olive industry, with big players going through major structural changes or leaving the sector altogether.

Frankland sale to boost Jingilli push

The past two years has been a period of upheaval for the Western Australian olive industry, with big players going through major structural changes or leaving the sector altogether.

Listed olive oil producer Frankland River Olive Company is the latest major Australian olive oil business to change its operational focus, putting 40 per cent of its grove area on the market earlier this week.

The company has called for expressions of interest for the purchase of the 336-hectare Parmelia Olive grove based in Gingin, which it bought in 2005.

"We want to concentrate more resources in our marketing efforts, the production (of olive oil) is increasing in Australia and you can buy processed oil from others these days," Frankland managing director David Carr told WA Business News.

The sale includes processing facilities and 250ha of additional land.

Other players to change tack include Cloverdale-based Olea Australis Ltd, producer of Dandaragan Olive Oil, which sold its 385ha grove and facilities to Great Southern Ltd for about $20 million last November, having decided to move into a different sector after completing a capital return to shareholders.

In August 2007, formerly Subiaco-based Piquant Blue Ltd, producer of Njoi Olive Oil, changed its name to Redisland and moved to Victoria after buying out the Victorian olive grove manager, Australian Agricultural Investments.

With the production of olive oil in Australia tripling over the past two years, Mr Carr said Frankland would be able to carry on with the expansion of its current markets by buying oil from WA and Australian producers, without the constraints attached to operating the additional grove.

He said the company would retain its 440ha in Frankland River.

"Our Jingilli brand comes from Frankland River and is hard to replicate, while the northern area has different characteristics," Mr Carr said.

Frankland announced last July that it completed its harvest with a total production less than half of the previous year's figure, but 40 per cent better than the January estimates.

This was mainly a result of the major pruning program carried out at the Parmelia grove, according to the company.

Frankland plans to use the resources generated by the sale for the distribution of the Jingilli product as well as the marketing and trading of Australian bulk extra virgin olive oil (Evoo) within Australia and internationally.

"In recent times, marketing bulk Evoo in Italy, Spain and Austria has been a great area for our business," Mr Carr said.

He said that the company is being successful in Asian markets too.

"We are exporting to China and we are nearly being listed in Malaysian supermarkets."

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