By Nick Carne
Small seeds can be big business, but you do need to get the numbers right. As Jamie Tidy puts it: “We deal with commodities that can double or halve in value from one year to the next. If the lucerne you bought last year for $2m is now worth $4m you look like a winner, but if it’s worth $1m then you have a situation to deal with.”
Tidy is Managing Director of Naracoorte Seeds, the 53-year-old family company his father ran before him. It’s not as well known as the nearby wine regions or World-Heritage-listed Naracoorte Caves but has grown to become a major economic contributor in the State’s southeast. It has more than 500 varieties of seeds on its books (a large proportion produced locally, with the rest bought around the world) and more than 60% of its business is export.
A Naracoorte Seeds crop of arrowleaf.
Saudi Arabia and China are major clients for lucerne and white clover respectively, while other seeds find there way to markets as far afield as the US, South Africa, Argentina, Italy and Portugal. Earlier this year, Contract Cropping and Lucerne Manager Josh Rasheed spent two weeks in the Middle East, exploring opportunities in emerging markets such as Jordan, Egypt and Qatar.
“Seed and pasture are very price sensitive in the export market,” Tidy said. “We have some long-term contracts, built up over 50 years in business, but with most products we know we are going to export a certain amount but don’t always know that the customers are going to be the same year to year.” Tidy says the business is the biggest Australian provider of white clover (an industry his father played a key role in establishing), arguably the biggest in sub-clovers, and one of the main players in a lucerne industry in the southeast that is worth in excess of $100m a year to the local economy.
There are, in fact, three companies. The original Naracoorte Seeds and newer Gambier Seeds meet local needs, while SA Seed Marketers handles the export side of things. This includes working with local farmers to help them make cropping decisions to maintain seasonal cashflow and meet changing global demand. It’s a complex business to run, exacerbated by the fact that you can only get one crop of most commodities in a year, and you can’t just switch from one crop to another at short notice.
You can, however, offer reliable supply if you have the right conditions. “That’s one of our great advantages,” Tidy said. “Here around Naracoorte we’ve got reliable underground water so we can generally guarantee to supply X amount of any commodity from one year to the next.”
The company recently expanded further by acquiring a consultancy business that specialises in the production of food grade materials such as sugar peas, mustard and Chinese cabbage for export to Hong Kong. Some things do remain the same, however; four of the seven staff members have been there for 20 years or more, headed by Office and Export Manager Mark Williams at 35 years. “He came to babysit the office for a week while dad was at a convention and never left,” quipped Tidy (a relative newcomer with just 13 years in the business).