Avocado lovers looking to hedge their high breakfast expenses could soon have a unique opportunity via agriculture company Alterra (ASX: 1AG) which has completed cost optimisation studies for its 300-hectare avocado orchard in Pemberton, Western Australia.
Within the studies for their Carpenters Project, optimisation of water usage will be a key element within Carpenters’ efficiency where construction for its first 3 gigalitre dam has commenced. This is the equivalent of 1,200 Olympic sized swimming pools whilst land preparation has also been completed for a 1.8 gigalitre dam also.
“Alterra offers investors an ethical way to capitalise on the rising value of water by developing agricultural land with water entitlements and identifying land activities that generate a higher value use for this water,” said Alterra Managing Director, Oliver Barnes.
In collaboration with leading irrigation firm Netafim, Alterra will install an intelligent precision irrigation and fertigation system capable of increasing yields by shortening the period for return on investment. Testing of the system trial identified the opportunity to reduce power and water requirements at Carpenters by up to 20% which is inline with Netafim’s previous results achieved for avocado producers on the East Coast of Australia and in Israel.
“By using the knowledge and data provided by our local execution partners coupled with a simulated onsite irrigation trial, Alterra is using the feasibility period to fine tune the irrigation and fertigation design,” said Barnes.
“This level of detail in the planning and preparation phase of the development is already benefiting the Company in optimising the future efficiency and productivity of this top-tier asset.”
Total land leased at Carpenters is 500 hectares with initial plans to utilise 300 for avocado orchards. In agriculture circles, the Pemberton region is well regarded for its mineral rich soils and high quality water which enable the region to consistently produce premium avocados for the global market.
With additional capacity for other crops, Alterra has received interest from peers and local partners for other high-value horticulture activities where the Company aims to optimise under-utilised assets into the next generation of agricultural products and whole foods.
Planting of Alterra’s first 5 hectares of avocado orchards will commence in September 2020.
A favourite amongst millennials, the common Smashed Avocado breakfast retails around Australia’s East Coast cafes upwards of $18 and remains uneconomically popular.
Alfred Chan is a Business Reporter at The Sentiment specialising in ASX-listed small cap companies, a bloodstock enthusiast and former equities analyst.
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