Fallen timber 

The fallout from the troubled Timbercorp group has thrown a major part of Australia’s rural industry into disarray and raised questions about the sustainability of urban-based schemes designed to minimise investors’ tax liability.

These concerns have been voiced by many in the horticulture industry since the beginning of the Managed Investment Schemes.

The corporation, which went into voluntary administration late last month, has forestry plantations and food crops in every State, with a total of 120,000 hectares under cultivation throughout Australia. In Queensland, Timbercorp’s avocado operations in Childers, managed by Simpson farms, halted production pending a decision by the Administrator. Simpson farms, which supplies 40% of the region’s market with avocados, was just five weeks into the season when the halt was called and while this may be good news for other producers in the short-term, many are concerned that the administrators could flood the market and sink prices.

Timbercorp also ran large citrus orchards in Renmark in SA and Bundaberg in Queensland. Between these two regions, there was approximately 1,400 hectares producing around 22,000 tonnes of fruit a year. This made Timbercorp one of Australia’s largest citrus operations however, these assets are now up for sale.

The township of Katherine in the NT is also feeling the effects, with a cloud over the continued operations of one of the biggest mango producers in the Top End. Timbercorp operations produced at least 15 percent of the Territory’s mangoes and operations at all Top End plantations have been suspended with uncertainty about the future of the farms and Timbercorp employees.

While competing growers have seen prices drop as a result of the large volumes of produce being grown under MIS operations, consumers have had the benefit of lower prices and seasonal produce being available for longer periods.

It now remains to be seen what effect the decline of MIS will have on market supplies and prices throughout all Central Markets over the coming months.