Major US berry breeding and marketing company Driscoll’s is setting up a new joint venture company in Australia with leading grower-packer-marketer CostaExchange aimed at transforming the berry category Down Under, Fruitnet.com can reveal.
The new 50:50 joint venture, Driscoll’s of Australia, is set to begin trading as a separate sales and marketing company on 1 April, according to Driscoll’s’ senior vice president of international and business development Soren Bjorn.
“This will be a stand alone company with its own general manager whom we’re in the process of identifying,” Mr Bjorn told Fruitnet.com. “It will leverage the resources of both companies and combine Driscoll’s’ genetics with BerryExchange’s genetics under the Driscoll’s brand.”
Driscoll’s previously had a joint venture in Australia with Oz Fresh, which held the intellectual property rights to license production of its varieties in the country. But that agreement was more of an ‘arms length’ arrangement for the US company, which has since decided it wants to get into sales and marketing in Australia and work more closely with growers and retailers in order to develop a year-round berry category for the consumer.
“We want to duplicate what we’ve done in North America in berries,” explains Mr Bjorn. “Our long-term goal is to run a 52-week-a-year programme, or as we call it, ‘a year-round berry patch’, including blueberries, raspberries, strawberries and blackberries.”
That consistent year-round supply of all four of the mainstream berries is key to building the category at retail level and expanding consumption levels, Mr Bjorn believes, pointing to its successful endeavours in North America, particularly with raspberries.
It’s a very different story right now in Australia, however. “In Australia, there are lots of strawberries but the supply is fairly fragmented as they come from multiple small-scale suppliers, there aren’t enough raspberries and there are hardly any blackberries,” he explained. “Blueberries are different because there is a dominant single entity with BerryExchange, but on the whole the retail chains are used to trading berries rather than developing the category.”
Those retailers have given a very warm reception to Driscoll’s’ concept of a “full berry patch year-round”, however, according to Mr Bjorn. “We have discussed the concept with the leading retail chains in Australia, and they’re very enthusiastic about it,” he told Fruitnet.com. “They have both shown a strong commitment to making it work and they see big opportunities to grow the berry category in Australia, which is significantly underdeveloped.”
While Driscoll’s had initially looked at going solo with its Australian venture, Mr Bjorn noted that joining forces with local heavyweight CostaExchange, a strong player in blueberries with a solid programme of winter raspberry production, made excellent commercial sense.
“By combining our complimentary strengths, we can create a much stronger offer for the retailer and consumer,” he notes. “Right off the bat we expect to have a very strong blueberry business and a rapidly developing raspberry business.”
In addition to forming a joint venture company in Australia, Driscoll’s and CostaExchange have struck a separate but simultaneous deal that gives Driscoll’s the rights to license production of CostaExchange’s berry varieties and intellectual property in the Americas.
“CostaExchange was looking to commercialise its genetics and Driscoll’s wanted to boost our blueberry genetics, so this is a complimentary programme that will allow us to enhance our berry offer in the Americas,” explained Mr Bjorn. “Both companies have strong family backgrounds through the Costa family in Australia and the Reiter family at Driscoll’s – it’s a really strong fit.”
Those rights to license production of CostaExchange’s unique varieties are territorial, being confined to the Americas. “The fruit will be grown here and marketed here,” said Mr Bjorn. “We’ve already got trial plantings in the ground throughout North America and this fall harvest will be our first with material from BerryExchange’s breeding programme.”
CostaExchange subsidiary BerryExchange has one of the largest blueberry research operations in the world. The company has been developing blueberry varieties in cooperation with the University of Florida in the US since 1992, and now has what is considered to be the best gene pool of Southern Highbush varieties in the world.
For full story, see January/February edition of Asiafruit Magazine.
