Linking growers to consumers: the essential role of central markets

The average Australian wouldn’t know what a central market is, but these hives of industry work 24 hours a day to ensure delicious fresh produce makes its way to the dining table of consumers across the nation.

According to Murray Bros General Manager, Susan Lewis, central markets are in a unique position to target the distribution of produce to suitable buyers, regardless of grade.

“They are a vital link for the fresh produce supply chain, to ensure all buyers and consumers are consistently supplied with all lines of fruit and vegetables,” Mrs Lewis said.

Central markets are also the location where prices are set based on supply and demand. According to Ireland 53 Director, Grant Southen, having multiple wholesalers working from one location ensures prices remain competitive.

“Central markets are an essential (and sometimes only) outlet for growers to achieve a fair market price for the product they grow. Without them, it would just be so difficult to know if you were achieving a fair price,” Mr Southen said.

“The benefits of the central market are always understated, especially when you speak to members of the public who don’t fully appreciate what it takes to get produce from farm to plate.”

This appreciation is growing though, with a spotlight placed on wholesalers during the global health pandemic highlighting the essential nature of the services they offer, according to United Lettuce Director, Joseph Spoto.

“The benefit of the central market system has never been more at the forefront. For example, when COVID struck, exports had seen a meteoric rise for two of our main categories, grapes and citrus,” Mr Spoto said.

“Growers were turning away from domestic trade to target the lucrative markets in China, and who could blame them? But then COVID came, the export market came to a halt and the Chinese market became too risky with volatile pricing and minimal commitment to purchase.

“During the 2021/2022 table grapes season, growers who had geared up for export realised that although selling domestically was not as lucrative, market returns offered peace of mind,” Mr Spoto said.

Facing the challenges

Like many businesses at the moment, labour and logistics are two of the biggest challenges facing wholesalers.

“Transport is one of the most prevalent challenges for my business, not only the rising costs but also the difficulty securing freight. It is very frustrating in a growing business as sales are hamstrung by not being able to receive enough stock due to freight,” Mr Spoto said.

According to Mr Southen, logistics into the markets have become more sporadic since COVID.

“We are having more trucks arrive late which puts strain through ours and our customers delivery chains,” Mr Southen said.

Staffing levels are also an industry-wide issue.

“Both market traders and growers have faced labour shortages, and this isn’t looking to improve anytime soon,” Mr Spoto said.

“Thankfully, we’ve been able to make use of Brismark’s recruitment services. Having them on hand gives our HR Department a second opinion on issues and the information they provide has been invaluable to us.”

There is a recognition amongst wholesalers that while businesses face difficulties across the board, growers have unique challenges and cost increases that are making life especially hard at the moment.

“Like most businesses, our input costs have gone up, but growers are experiencing much higher input costs. So, we are always mindful of these issues when selling their produce,” Mr Southen said.

While these challenges are unique to the current economic environment, there is one impact on the fresh produce supply chain that will always be a concern and impossible to control.

“The biggest challenge for fresh produce is the unknown course of Mother Nature,” Mrs Lewis said.

“Whether it is flooding, drought, hail or intense heat, Australia’s weather is always going to be a wild card that we just have to keep adapting to.

“We are very lucky to have such diverse growing regions, but when weather events occur in multiple regions at once, it can have a significant impact on the supply of fresh produce.”

Supporting each other

Working within a central market allows Brisbane Markets wholesalers to act as a conduit between growers and buyers, ensuring growers understand consumer trends and expectations while buyers can access the quality and quantity of produce they require.

“We work closely with all of our growers, by promoting their brands and their quality, which in turn delivers the best returns we can get for them,” Mrs Lewis said.

“Through them, we aim to source the highest quality produce for our customers to give them year-round quality products to supply to their consumers.”

Mr Spoto said that without growers or buyers, wholesalers would have no business.

“The stronger their businesses are, the stronger ours is. We offer our growers transparency, understanding, compassion and we always try to maximise their returns,” Mr Spoto said.

“In our industry, you are not going to be liked by everyone, but you will find you attract customers if you genuinely care about how the product you are selling performs at a retail level. If problems do arise, good wholesalers deal with the issue working with our customers as best we can.”

Wholesalers are in a unique position to notice shifts in consumer trends via the buying habits of retailers and providores.

“We’ve noticed a definite trend amongst buyers in the market to go for a higher quality product. There is just much less demand for cheap or inferior product,” Mr Southen said.

“We are always communicating the current market conditions as best we can, so growers can make informed choices for their business. We also act as sounding boards when it comes to new product development and branding changes.

“By working with buyers on their specifications and requirements, we’ve been able to take that information back to the growers to achieve better results for them as well. If you don’t work with the buyers and growers together, neither side will be happy!”

Looking to the future

The next 18 months are sure to see more financial pressure on businesses and individuals alike.

“Never have so many families borrowed to the hilt and only time will tell what that means for our industry,” Mr Spoto said.

“Traditionally, in tough financial times the central markets have performed well. If interest rates keep rising, we may see more people cooking at home and buying more from their local fruit and veg shop again, like we witnessed during COVID, and healthy lifestyle habits have definitely been on the rise.”

With supply volumes growing by 850,000 tonnes over the last decade (see more on page 30), the future looks bright for horticulture.

“Supply volumes continue to increase across the country, creating more opportunities for all parties from growers through to consumers,” Mrs Lewis said.

“Export is an area that seems to be expanding across different lines, enabling more opportunity for growers to keep building their production volumes.”

Mr Southen said that he hoped to see normality return to export markets and was excited to see what the next decade would bring.

“The Olympics will be a big economic driver for South East Queensland over the next 10 years and that should create an increasing demand for fresh produce with more restaurants and more retailers coming into the mix.” Mr Southen said. No matter the future, those who can adapt will always be at an advantage.

“It sounds cliché, but the harder you work the more opportunities present themselves,” Mr Spoto said.

“The best operators in our industry are the ones who have adapted to change over the years. Opportunities can still be found, and having integrity and a good reputation play a big role in how often those opportunities present themselves.”

DID YOU KNOW?

Brisbane Markets is made up of three different markets: the Brisbane Produce Market, the Brisbane Flower Market, and the Saturday Fresh Market.