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In a move intended to ensure growers of fruits receive a fair return Murray River Organics (ASX: MRG) have upped the prices of dried fruit by up to 25 per cent.
The company says the price hike is commensurate with global pricing trends which have seen a doubling of pricing in comparable global grower markets in the last few years.
MRO chief executive Valentina Tripp says the price increase should result in further investment in innovation and development.
"Prices that have been paid to growers don't reflect the high-grade fruit being produced in the region," says Tripp.
"As the largest dried vine fruit grower in Sunraysia with over 1000 hectares planted, MRO is committed to increases in Australian dried fruit pricing, providing strong support for further investment in the industry with new plantings and yield enhancement programs."
"Growers have been severely disadvantaged as price increases were severely constrained with more than 70 per cent of Australian fruit servicing domestic channels, and they missed out on global demand and price growth. Export markets were typically an afterthought, and only if there was fruit available to be traded."
With more than 80 per cent of MRO's dried vine fruit being exported around the world, the company hopes this boost for farmers will allow them to dominate further overseas.
"The global dried vine fruit market is experiencing significant growth in demand and Sunraysia Growers can now share in this trend by working with the MRO team," says MRO.
MRO completed a successful capital raise in November 2018, receiving significant support from major institutional investor Thorney Investment Group. Owned by Alex Waislitz, prominent Australian businessman and rich-lister, Thorney now owns 30 per cent of MRO.
Tripp says MRO's main target now is the Asian market.
"Australia has the best fried vine fruit in the world and our focus for 2019 is to extend our range of branded dried vine fruit products, both natural and organic, suited to the Asian customer," says Tripp.
"With concerns about food safety in Asia and the trusted Australian clean and green image we believe the strong interest we are seeing from the region will result in significant new contracts."
Shares in MRO are up 16.67 per cent to $0.14 per share at 11.12am AEDT.
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Business News Australia
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