Agriculture: Food Revolution signs Metcash deal with one eye still on the Chinese market
Food & Agriculture
Food & Agriculture
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Fruit and veggie processor Food Revolution Group (ASX: FOD) has been busy executing on a China-focused strategy.
But the company is still building its Australian footprint, announcing a distribution deal with Metcash Victoria this morning.
The agreement adds to existing supermarket deals with Coles, Woolworths and Aldi.
FOD said it has received the first orders of its Juice Lab products from IGA and Foodworks, which fall under the banner of MetCash’s Victoria operations.
Still, thoughts of China are never far away. The company said that increased local distribution will help boost its domestic sales profile, which it can then leverage into the Chinese market.
Shares in FOD were up just over five per cent in morning trade to 10 cents.
“While our recent efforts have been on extending our distribution in China and other international markets, we are continuing to work to grow availability of our products in Australia as well which underpins our business and provides a solid platform to expand into China,” CEO John Florey said.
The company’s stock price is down from a high of 20 cents in December, following a period of strong momentum after the September sale of a 52 per cent stake in the company to a group of investors led by Dr Norman Li.
Li founded healthcare company Careline in the 1990s, which has gone on to execute a successful wholesale export strategy to Asian markets.
Today’s announcement follows a memorandum of understanding signed in mid-April with ICC Global, an e-commerce platform which connects Australian companies with Diagou (personal exporters) and other distribution channels into China.
Under the terms of the MOU, ICC will start by purchasing 10,000 units of FOD’s orange juice product which will be shipped to China in June.
Murray River Organics (ASX: MRG) released a business update, announcing its dried vine fruit harvest is 4-5 weeks behind schedule due to hot summer conditions. As a result, some revenue may be deferred to FY20.
The company added that its capital management program is on track for completion by June, but sales growth is behind expectations as the company finalises its operational restructure. MRG has been trying to get back on track since October after shares in the company declined sharply last year. The stock was unchanged at 8.2 cents in morning trade.
And almond grower Select Harvests (ASX: SHV) was up 3.1 per cent to $6.64 after providing a crop and market update. The company completed its harvest last week, and said favourable weather conditions contributed to a crop yield that’s expected to be 10 per cent above benchmark industry volumes.
SHV added that market conditions remain “buoyant” for domestic and export customers, with forecast sales in line with previous guidance.