Giant seawater tomato venture seeks new market options

Giant seawater tomato venture seeks new market options


Sundrop Farms' new-age horticulture development at Port Augusta has a 10-year agreement with Coles to supply consistent year-round volumes of tomatoes grown with desalinated seawater.

Sundrop Farms' new-age horticulture development at Port Augusta has a 10-year agreement with Coles to supply consistent year-round volumes of tomatoes grown with desalinated seawater.

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The $200 million seawater- and sunshine-powered Sundrop Farms hydroponic venture is looking at getting bigger.

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The year’s biggest farming development, the $200 million seawater- and sunshine-powered Sundrop Farms hydroponic venture, is looking at getting bigger.

The 12,000-tonne to 15,000t a year tomato farm in remote South Australia seems likely to be duplicated in other sites in Australia and overseas.

In October Sundrop officially opened its massive covered cropping operation –  four seawater-cooled glasshouses each covering five hectares.

Next year it will launch its own Sundrop brand, highlighting the futuristic farm’s environmental credentials and competitively priced produce to Coles supermarket shoppers Australia-wide.

The SA operation, sited on the edge of Spencer Gulf, has become something of a new-age horticulture industry poster child after Sundrop locked in a 10-year agreement with Coles to supply consistent year-round volumes of tomatoes grown with desalinated seawater.

The decade-long deal is considered the longest supply agreement of its type in the world, while the project ranks as Australia’s biggest single-site horticultural development.  

The super-sized, high-tech venture uses 23,788 mirrors angled to focus sunlight onto a desalination tower boiling seawater drawn from the gulf and distilling it to irrigate the hydroponically-grown truss tomato crop.

Steam from the 300 degree C boiler atop a 127-metre-high tower also powers a turbine generating a third of the electricity used on the site and heating greenhouses at night and in winter.

A field of mirrors concentrate reflected sunlight onto a heating element to boil seawater to 300 degrees to run a steam turbine and start the desalination process.

A field of mirrors concentrate reflected sunlight onto a heating element to boil seawater to 300 degrees to run a steam turbine and start the desalination process.

The site is eventually expected to be entirely energy self sufficient, but is already saving itself the equivalent of 14,000 litres of diesel a week in heating fuel costs further enhancing the business’ environmental credentials.

On a 240-hectare parcel of semi-arid country near Port Augusta which previously supported just 20 beef cattle the glasshouse venture now grows 770,000 grafted tomato plants, employs about 220 staff and has solved a major supply irregularity problem for its supermarket client.

​The Port Augusta farm’s year-round production peaks during the seven-month autumn, winter, spring period to compensate for the industry’s most unreliable production period.

The whole venture was planned and built around providing a consistent supply of high quality Merlice variety tomatoes at margins which ensured long-term, acceptable profits for Sundrop and Coles, but also competitive prices for consumers.

Sundrop’s managing director, Steve Marafiote, said despite daytime temperatures frequently topping 40C and the scarcity of fresh water, the company had used creative thinking and proven solar technology to take control of production costs and achieve its “triple P” agenda –  people, planet and profit.

Sundrop Farms managing director, Steve Marafiote, is looking at other sites in Australia and abroad, and other crop options, to complement its massive, high-tech hydroponic tomato venture.

Sundrop Farms managing director, Steve Marafiote, is looking at other sites in Australia and abroad, and other crop options, to complement its massive, high-tech hydroponic tomato venture.

With only about three per cent of the world’s water being fresh, and 70pc of that used for agriculture, Mr Marafiote said Sundrop set out to utilise technology to make the most of natural resources to better tackle global water and food shortages.

After building a 0.2ha pilot operation in 2008 to “drought-proof” the technology, construction began on the full-sized version last year.

“Australian agriculture’s biggest limitation –  water –  has become less of a problem for us,” he said.

He told the recent Australian Farm Institute agriculture roundtable conference, Sundrop was looking at other sites in Australia and abroad and other crop options – glasshouse-suitable produce which potentially may range from cucumbers and capsicums to berries or lettuce.

“We would like to replicate what we’re doing at Port Augusta,” he said.

“The application of the technology may be different –  we have nothing defined as yet, however it will always be about solving a supply problem for our partner, Coles.

“We have ambitions, but we’re not at the point of saying exactly what the next step is.”

Critical to the Port Augusta operation’s success has been a close direct relationship cultivated with Coles, shaving supply chain costs by eliminating intermediaries, while also establishing long-term consumer-friendly price points which are sustainable for the retailer and producer,  and benefit the shopping public.

Refrigerated Coles trucks leave Port Augusta daily destined for  Adelaide, Perth, Melbourne, Brisbane, Darwin and Sydney, returning loaded with production inputs and packaging materials.

The ambitious project’s funding base came from London-based family investment group Saumweber Holdings, headed by former investment banker and hedge fund investor, Philipp Saumweber, who is also Sundrop chairman and chief executive officer.

Backing to the tune of $100m also arrived in 2014 via US private equity firm KKR, while project finance came from the SA government and lenders Challenger and Commonwealth Bank of Australia.

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