A LEADING supplier of frost fans is undertaking a strategic review of its business in the hopes of expanding into international markets.
The New Zealand Frost Fans group and its division Australian Frost Fans, said despite being one of the top three frost fan suppliers internationally and the largest in Australia, its market penetration was only in its early stages.
NZ Frost Fans group, CEO, Steve Haslett said this year the groups revenue had increased by more than $37 million, as growers sought to implement reliable methods to protect high value crops from frost.
“We see huge growth opportunity in front of us, particularly in places like Europe and South America where climate change is increasingly delivering more extreme weather events and damaging frosts,” he said.
“You look at, say, Europe’s top three producers, Spain, Turkey and Italy, at 3 per cent penetration by frost fans, that’s a market opportunity for more than 20,000 fans, add in South American countries, Argentina, Brazil, Chile, on the same basis and there’s potential for another 8,000 machines.
“Our proven ability to provide more efficient and reliable and quieter solutions is a significant advantage we can bring to these markets.”
Mr Haslett said these figures spoke to the growth opportunities in the sector.
“To date we have really only dipped our toe in these markets and we now know the demand is there,” he said.
“So the opportunity for us is huge, within the next three-to-five years we could be doing three times the revenue that we currently have, and substantially more is possible longer-term.
“But it will require significant funding for the next phase of growth.”
Mr Haslett said Frost Fans operate out of six sites across Australia, marketing its products under the FrostBoss brand.
He said frost protection systems still make up only around 3pc of the target crop area in Australia, estimated to be about 300,000 hectares.
“The dynamics are different from region to region and crop to crop, but in frost-prone areas with high value crops the scale of losses can hit growers hard,” he said.
“In those places, the economics of our offering become more and more compelling because it’s more reliable and cost-effective than the alternatives.”
“Our goal is to continue to make technical advances that help reduce the stress of the frost season for growers and their families.”
Mr Haslett said frost fans draw down the warmer air trapped in the thermal ceiling or inversion layer 15 to 60 metres above an orchard or vineyard at night, this allows it to mix with the colder layer of air around the trees and vines.
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