Select Harvest almond sales hit by virus delays

Listed agribusiness play Select Harvests has been forced to delay shipments of almonds to its biggest export market, China.

Select maintained its forecast net price of $8-8.60 a kilo.

Listed agribusiness play Select Harvests has been forced to delay shipments of almonds to its biggest export market for the nut, China, citing the deadly coronavirus outbreak.

The company has “no concerns” about meeting its yield target for this year’s crop — of which 20-30 per cent has already been contracted for sale.

“(However) since contracting these sales market conditions have deteriorated, with a larger US crop and the coronavirus demand disruption in China,” chief executive Paul Thompson said.

“The coronavirus has resulted in customers requesting orders to be delayed, which will impact on second and third-quarter cashflows.

“Until China’s supply chain is restored, our traditional markets in India, the Middle East and Europe remain our priority.”

Mr Thompson said in the past 12 months, China had become Select Harvest’s biggest export market for almonds, with the company establishing “good distribution and relationships with Chinese food manufacturers”.

It comes as sales have come under pressure on the back of a larger US crop and the Chinese government recently lowering the tariff on US almonds from 60 to 55 per cent, as part of its ceasefire in its US trade war.

Despite the deteriorating sales environment, Mr Thompson said Select maintained its forecast net price of $8-8.60 a kilo, which has been assisted by a weaker Australian dollar.

The company is set to begin its almond harvest in the next two weeks.

Mr Thompson said unlike most agribusiness, Select would like the rain to hold off to ensure an uninterrupted dry harvest.