Avocado boom drives Tanganda back to profitability

An 84% growth in avocado production has helped Tanganda return to profitability, recovering from a loss recorded last year.

The company, which has five fruit and tea estates in the Eastern Highlands, recorded a 9% growth in revenue to US$25.7 million in the year to September. This saw the company making a US$1.4 million profit, from a US$3.1 million loss last year.

Avocados were the star performer, with exports growing at a time when world avocado prices were firming.

The company produced 3,976 tonnes of avocados, 84% more than last year, as its plantations matured. Exports grew by 40%, at a time avocado prices rose from 44 cents per kg last year to 75 cents per kg.

The avocados that were not exported were sold for oil extraction and to the local market.

Tanganda’s macadamia business also performed strongly, with production up 77% to 1,626 tonnes. However, exports were disrupted by logistical problems caused by rescheduled ships. Prices are also falling because consumers now prefer kernels over nuts-in-shell.

Tanganda says: “The company plans to invest in value addition processes to reduce the risk of primary produce price fluctuations.”

The tea segment showed mixed results. Local sales of packed tea declined, partly due to packaging material shortages and weakening formal retail. However, tea exports rose by 41%.

The company’s investment in solar energy shielded it from the impact of power cuts this year. the company installed solar plants at three of its five estates – Tingamira, Ratelshoek and Jersey – and is looking to sell excess electricity back into the grid. “Grid tying and net metering arrangements are strategies being pursued to leverage on excess power generated from solar plants which will in turn reduce the cost of power.”

Tanganda was spun off from Meikles in 2021. Meikles used the money from the US$20 million sale of Meikles hotel to invest in agriculture.

Text/Image- NewZwire