Research, Development & Extension
Investment Plan
2010-2015
“Innovation making a difference”
Apple
&
Pear Industry
Apple and Pear Industry RD& E Investment Plan 2010-2015 – “Innovation making a difference”
The information contained in this publication is intended for general use to assist public knowledge and discussion and to help improve the development of the apple and pear industry across Australia. You must not rely on any information contained in this publication without taking specialist advice relevant to your particular circumstances.
Whilst reasonable care has been taken in preparing this publication to ensure that information is true and correct the Australian Apple & Pear Limited (APAL), Horticulture Australia Limited (HAL) and the Commonwealth of Australia give no assurance as to the accuracy of any information in this publication. APAL, HAL and the Commonwealth of Australia, the authors or contributors expressly disclaim, to the maximum extent permitted by law, all responsibility and liability to any person, arising directly or indirectly from any act or omission, or for any consequences of any such act or omission, made in reliance on the contents of this publication, whether or not caused by any negligence on the part of APAL, HAL and the Commonwealth of Australia, the authors or contributors.
The Commonwealth of Australia does not necessarily endorse the views in this publication.
This publication is copyright. Apart from any use as permitted under the Copyright Act 1968, all other rights are reserved. However, wide dissemination is encouraged. Requests and inquiries concerning reproduction and rights should be addressed to the HAL Publications Manager (+61 2 8295 2300). The Apple and Pear Industry Advisory Committee (IAC), APAL & HAL acknowledge the work of Dennis Richards (DR Research & Consulting) in leading the development of this plan. Also the valuable contributions of those people contacted (and cited in the plan) and the IAC’s R&D Sub-Committee are acknowledged.
Electronically published in September 2010
by APAL http://www.apal.org.au/research-iac-research-priorities.cfm
and HAL http://www.horticulture.com.au/industries/Apple_and_Pear/default.asp?src=side Contact Details:
Brad Mills
Horticulture Australia Limited Level 7, 179 Elizabeth Street, Sydney New South Wales 2000 Australia T: +61 3 9909 7542; M: 0408 635 465 E: bradley.mills@horticulture.com.au
Tony Russell
Apple and Pear Australia Limited 39 O'Connell St, North Melbourne, Victoria 3051 Australia
T: + 61 3 9329 3511 E: gm@apal.org.au
Foreword
The Australian apple and pear industry, with an estimated gross value of production of $450 million, is the 3rd largest horticulture industry (after grapes & citrus). In world terms, however, the 2008 yield of
265,400 tonnes of apples represented just 0.8% of world production; and for pears 127,800 tonnes represented only 1.4% of world production.
Following an extensive consultation and data-gathering process a new strategic plan for the Australian apple and pear industry -New Horizons 2015- has recently been developed, endorsed and adopted. That plan highlighted the urgency for industry to accelerate change, respond to domestic and export market challenges and to improve industry communication and capability.
The present RD&E Investment Plan is devised in response to New Horizons 2015 and is more comprehensive than previous plans – in many ways a step-change to past approaches. Firstly, it is not an annual plan as before but embraces a period of five years (2010-2015). Secondly, it is much more strategic in nature encompassing seven RD&E programs identified as key investment areas. Thirdly, the portfolio has been devised to encompass much larger, better resourced and better integrated projects that are more tightly managed and monitored.
Overall the Plan outlines the RD&E outcomes that are required to meet the industry’s vision for 2015, namely: “The Australian apple and pear industry is world competitive; satisfying consumer demand for
its products and with sustained profitability”.
In developing this Plan it is acknowledged that the partnership between the Australian Government, Horticulture Australia Limited, the Apple & Pear Industry (represented by Apple & Pear Australia Limited), research providers and co-investors is the essential component bringing together resources, expertise and a shared vision. The Plan provides guidance to existing and potential research providers and co-investors on our priorities and mechanisms to engage with the apple and pear industry.
The successful implementation of this plan requires a shared commitment in partnership to actively face and address the major challenges that lie ahead.
October 2010
Bob Granger Tony Russell
Chairman General Manager
Table of Contents
1. Executive Summary ... 5
1.1 Setting the scene ...5
1.2 Planning issues ...6
1.3 RD&E plan highlights ...6
1.4 Budgets and risks ... 12
1.5 Overall performance ... 12
2. The Australian Apple and Pear Industry - an Overview ... 13
2.1 Structure and production ... 13
2.2 Sales and markets - a domestic focus ... 14
2.3 Trends, challenges and drivers ... 14
3. Apple and Pear Industry Strategic Plan - New Horizons 2015 ... 16
3.1 Developing the plan ... 16
3.3 Strategic plan highlights... 16
3.3 Strategic plan details concerning RD&E ... 18
4. Key Stakeholders, their Strategic Plans & Co-investment ... 19
4.1 Partners’ strategic plans & objectives ... 19
4.2 Overview of funding and priority setting ... 22
5. The Development of the RD&E Investment Plan – Principles, Process &
Priorities ... 25
5.1 Why a five-year RD&E plan? ... 25
5.2 Guiding principles and issues ... 25
5.3 RD&E planning process ... 26
5.4 Re-defining priority areas ... 27
5.5 Overall performance ... 28
6. The RD&E Portfolio – Priority Investment Areas ... 29
6.1 Productivity & Supply Chain ... 29
6.2 Climate Change ... 33
6.3 Germplasm Improvement ... 35
6.4 Market Access and Biosecurity ... 40
6.5 Market Research ... 42
6.6 Industry Development ... 45
6.7 Portfolio Management... 51
7. Indicative Budgets and Risks ... 53
7.1 Indicative budget and allocation targets ... 53
7.2 On-going budgets ... 55
7.3 Potential risks ... 55
8. References... 57
8.1 Acronyms & abbreviations ... 57
8.2 Key documents ... 58
1. Executive Summary
1.1 Setting the scene
In March 2010, Apple & Pear Australia Limited (APAL) endorsed the apple and pear industry strategic plan called New Horizons 2015.
In developing the plan it was acknowledged that the Australian apple and pear industry is facing challenging times (see Section 2). The challenges, which are broadly-based across the production, supply and marketing chain, include the need to increase productivity to world-class levels, raise domestic consumption against competition (from other fruit products and from the imminent likelihood of foreign imports) and develop an export focus from a low and declining base.
The outline of the New Horizons 2015 plan to meet these challenges is summarised in Section 3 (FIGURE 1 shows diagrammatically the strategic plan on one page). The following three priority objectives, targets and approaches have been set:
1. stimulate domestic demand by 5 per cent through product quality and innovation by improving quality, increasing sustainable productivity and a transition to novel varieties
2. expand apple and pear export markets to 10 per cent of marketable product by 2015 by identifying overseas opportunities, making the right commercial liaisons and addressing market access issues
3. ensure industry has the resources and capability to achieve its primary objectives by improved motivation, communication and knowledge transfer to individual growers and the consequent development of leadership and skills competency
The business and operational activities of the apple and pear industry do not occur in isolation. It is recognised that substantial change can only occur with effective communication and collaboration with other parties such as industry associations, governments, growers and supply chain businesses, all acting collectively. In particular, RD&E, perhaps more than in any other activity, requires close collaboration and co-investment to be effective. Section 4 addresses the motivation and strategic directions of the key agencies that will continue to be funding partners and providers delivering RD&E outcomes. The key agencies are:
Horticulture Australia Limited (HAL) Australian Government
government research providers from around Australia (collectively termed the National Horticultural Research Network, NHRN)
private sector & international research providers
Each of these major partners in the apple and pear RD&E portfolio has a commitment and role to invest in, sponsor or conduct research. A prerequisite for co-investment is a shared vision between collaborators. Therefore, when constructing the RD&E portfolio and its individual projects, the strategic objectives of all contributing parties must be addressed.
Of particular note in formulating the present RD&E plan, is the development of a national framework describing how NHRN intend to engage with APAL and HAL in negotiating and delivering RD&E services. It has been estimated that the overall co-investment of NHRN alongside (but not matched with) other funds represents in the order of 44% of total annual apple and pear RD&E spend. Under the new delivery framework NHRN has determined that the Department of Primary Industries Victoria will function as the formal point of contact with the apple and pear industry/APAL. The role, when fully operational, would include one of leadership and coordination across the entire network of RD&E provider agencies.
A key trend in the recent development of the apple and pear RD&E portfolio is the partnership of various international research providers; notably the New Zealand–based Plant & Food Research (PFR) who are major providers and voluntary contributors in two large projects. It is anticipated that the co-investment model of matching industry levies and/or voluntary contributions from other parties
with Australian Government funds, alongside non-matched NHRN funds, will continue to be the primary funding mechanism (see FIGURE 2, Section 4 for details).
1.2 Planning issues
In the past the R&D priorities for the apple and pear industry have been formulated and presented on a yearly basis. This approach has tended to reinforce a pragmatic decision-making approach, rather than a long-term, staged analysis to determine where investment is needed. In addition, short-term plans do not capture the changing trends and refocussing of partners’ and other stakeholders’ longer-term visions. Therefore, this present plan spans the five-year period 2010 to 2015. In addition, this plan is much more focused on industry development and extension activities as a driver of change; thus RD&E not R&D.
Analysis of past approaches in managing the RD&E portfolio has led to the identification of some guiding principles to help in the development and implementation of this five-year plan (Section 5). Broadly, these principles include:
the need for larger, integrated and pre-scoped projects allowing significant savings of resources and management time and appropriate planning with potential partners
broad agreement and effective engagement with stakeholders including the NHRN restructuring the portfolio around priority investment areas aligned to New Horizons 2015 on-going assessment of performance and quality of individual projects, priority investment areas and of the RD&E plan itself
clarity of engagement through details set out in the plan, providing a “road-map” to potential partners/co-investors and emphasising the need to demonstrate benefits to industry
In undertaking the development of this new plan (see FIGURE 3, Section 5.3) three main sources of information, both from industry and partner agency sources, were analysed. They were: the past and current project portfolio; key strategic documents; and information derived from discussion with key contacts (see Section 8 for details). When compared with the objectives of New Horizons 2015, gaps and opportunities were identified. This analysis has resulted in the identification of several new or on-going large projects formulated into seven new priority investment areas: Productivity & Supply Chain Climate Change; Germplasm Improvement; Market Access & Biosecurity; Market Research; Industry Development; and Portfolio Management.
1.3 RD&E plan highlights
1.3.1 Productivity & Supply Chain (see Section 6.1)
In the past RD&E projects addressing productivity and supply chain issues have been undertaken as discrete units of study based on topics such as: agronomy, pest and diseases, post harvest , fruit quality etc. There is a compelling need to take an integrated systems approach when tackling RD&E in this area.
The whole-of-chain viewpoint is a major feature of New Horizons 2015 and the strategy for on-going RD&E in this area is to undertake an integrated systems approach in two broad areas.
Productivity, Irrigation, Pests & Soils (PIPS)
PIPS is a flagship project for the apple and pear industry. It has been able to successfully integrate RD&E effort both nationally and internationally, involving PFR, New Zealand researchers and project leaders. This amalgamation of expertise allows a multi-disciplinary approach to tackle the interacting factors associated with sustainable crop production.
For the period 2010-2015 it is envisaged that all on-going activities and any new initiatives concerning “orchard productivity” will be embedded in the PIPS program. It should be noted that PIPS is also the preferred project to embed all future work on pests & diseases.
At its onset in 2009, a number of missed and future opportunities were highlighted to be folded into the program. The activities planned to be brought on stream during 2010/15 include:
consolidating regional activities (including Queensland, Western Australia) and introducing new germplasm ( both apples and pears)
an additional focus on powdery mildew
inclusion of soil carbon amendment studies and fertigation
Sustainable Supply Chain Analysis
It is proposed to develop a multi-disciplinary RD&E project tentatively entitled “Tree to Table: Sustainable Supply Chain Analysis for Apples and Pears” (TTT) incorporating Value Chain Analysis and Life Cycle Analysis approaches. In addition, the project will utilise information and expertise already assembled in the projects on fruit quality and retail/consumer relationships presently underway or recently completed. TTT will be broad-reaching and augmented by other activities in tandem with the VCA theme.
The project will be commissioned by a call for “expressions-of-interest”. Under the auspices of HAL, the initial stage will be to devise and scope TTT with key participants to ensure that direct benefits to growers and the apple and pear industry at large.
It is envisaged that the process of project development will itself be a substantial activity requiring significant time and resources from potential partners and co-investors. However, ongoing activities from this large program are expected to generate a key understanding of the supply chain and help identify critical priorities for future RD&E investment.
Key performance indicators by 2015
The PIPS program has met all of its milestones, gained a high industry profile and has been re-contracted following a positive review
The TTT project has been commissioned and the majority of identified issues (see Section 6.1.3 for details) have been incorporated into, or addressed outside, the program
1.3.2 Climate Change (see Section 6.2)
Using the previously completed HAL and across-industry activities, and the “first steps desktop study” as a framework, it is proposed that on-going RD&E in this priority area will be enhanced and consolidated into a single project entitled “Responding to Climate Change; Beyond 2010” led by a dedicated project manager.
In formulating this consolidated program, the RD&E Sub-Committee and APAL will need to actively engage with the NHRN. In addition, the basic structure of a DAFF-sponsored Farmready project will be assimilated into a broader program.
The issue of carbon footprints (and water footprints) will be addressed as a component of the “Tree to
Table: Sustainable Supply Chain Analysis for Apples and Pears” project utilising a Life Cycle Analysis
approach. A study of carbon amendments into orchard soil, potentially utilising biochar and brown coal, is to be undertaken as a component of the PIPS project.
Key performance indicators by 2015
The majority of targeted growers (>75%) in all regional apple and pear growing districts have a good understanding of the likely impact of climate change on their production systems
Following a targeted survey, the apple and pear industry is viewed by Government and the community as proactive in exploring and addressing climate change issues
1.3.3 Germplasm Improvement (see Section 6.3)
The apple and pear industry has been, and will continue to be, a substantial investor in variety and rootstock improvement. The strategy taken by industry is to become a comprehensive player along the entire “development pipeline” and be actively involved in creating, facilitating and adopting new varieties.
There are some very important issues to address in the on-going investment by the apple and pear industry in this germplasm improvement investment area. A major issue is that a number of projects undertaken by State Government agencies will not be on-going and industry must play a more active role in any continuing activities to retain and evaluate potential germplasm. Further, there is potential to integrate the apple and pear programs so that variety and rootstock development and field testing can be better co-ordinated and more efficiently planned. Finally, where the interests of the Australian apple and pear industry are implicated commercially-aligned participants are encouraged, where possible, to plan together.
The strategic requirement in the investment area of germplasm improvement is to better integrate activities into a coordinated apple and pear industry program. This will help provide critical mass and resources and impart strong commercial direction with improved decision-making. An ideal structure would involve a coordinated program overseen by a management team, formulated by representatives of the key stakeholder partners, and utilising a dedicated program manager to ensure the quality, coordination and delivery of agreed milestones.
The specific activities that need to be quickly resolved and/or rejuvenated include breeding activities (e.g. pear breeding in Victoria and apple breeding in Western Australia) and the on-going access and evaluation of germplasm (e.g. pears from Victoria, apple rootstocks from New South Wales and apple varieties from Queensland).
The role and integration of activities involved in the PrevarTM project, the Coregeo Australia project and
the on-going APFIP project need to be actively considered in any overhaul or restructuring of the germplasm improvement priority area.
An interim activity is to establish a small implementation working group to analyse the scale, scope and best possible way of staging any integration of activities. This working group would deliver a plan agreed by all relevant stakeholders for implementation in November 2010 so as to coincide with the main funding cycle.
Key performance indicators by 2015
Pear breeding is an active part of the programThe fate of promising germplasm from previously supported breeding and selection programs undertaken by various State providers has been successfully negotiated
The majority of targeted growers (>75%) are satisfied with the approach and the level of investment into germplasm improvement
The level of investment and leverage is delivering the targeted outcome of introducing new varieties for industry-wide use
1.3.4 Market Access and Biosecurity (see Section 6.4)
The interaction and co-funding between industry, HAL, government and the RD&E community in the area of market access is notoriously complex and difficult to negotiate. Moreover, there are inevitable funding shortfalls that have a major impact on the maintenance of the appropriate skill base and infrastructure which frequently results in the need to refocus priorities.
Recent structural changes have occurred in an attempt to streamline the process of addressing market access issues with the creation of the Office of Horticultural Market Access (OHMA) by HAL in September 2009. Amongst other things, OHMA will coordinate a whole-of-industry research program based on “The Horticulture Market Access R&D Strategic Plan (2009-2014)”. The apple and pear
industry have an on-going generic investment in this broad-based program as a co-contributor. Importantly, it is OHMA that selects the individual projects that are undertaken at any given time, based on their adjudged priority. Specific issues likely to be of benefit to the apple and pear industry in the above program include: area wide management systems for Light Brown Apple Moth; cold disinfestation of fruit fly; data packages for cold tolerance of tropical fruit flies; replacement strategies for dimethoate and fenthion; and the preparation of a joint submission to Food Standards Australia & New Zealand (FSANZ) for approval to utilise irradiation as a phytosanitary measure.
Single-industry market access and biosecurity RD&E projects are not considered within the scope of the above market access plan. Rather they are considered separately on a needs basis by industry and HAL. Such projects may include those that are more oriented to specific growing regions/districts or to on-farm practices and may involve agencies such as Plant Health Australia (PHA) or the Cooperative Research Centre for National Plant Biosecurity (CRCNPA).
Currently APAL has commissioned a review by an independent technical advisor working in concert with OHMA to guide the future investment and priorities for the apple and pear industry in market access RD&E over the period 2010-2015. In addition, the review will help identify that part of the investment which is best served by an across-industry approach and that which is best undertaken directly as industry-specific projects.
Activities relating to on-farm biosecurity and risk management will increasingly be addressed as part of the industry development portfolio in an extension capacity (see Section 6.6.3). However, where more regionally-based biosecurity measures are concerned, it is anticipated that the development of risk management tools and training activities will be on-going throughout the five year life of this plan.
Key performance indicators by 2015
The apple and pear industry’s contribution to the across-industry program has been invested into priority areas and the RD&E is operational
Specific apple and pear industry projects have been identified and a planned program of investment is underway
Application of RD&E outputs has helped gain access to additional export markets
1.3.5 Market Research (see Section 6.5)
The challenges, objectives and action plans identified in New Horizons 2015 that address market research are numerous and specific. Clearly, there is a need to undertake a series of activities related to market research in both a domestic and an export setting.
New strategies and specific projects in these areas are being developed and co-ordinated separately (from this RD&E plan) through the Domestic Marketing Operational Plan and the Export Marketing Operational Plan.
However, the preferred approach is to undertake consumer market research activities in the context of supply chain studies; not in isolation. Consequently, in this RD&E plan, there is a proposal to embed some consumer research and the prospect of pilot-testing an “Aussie Apple” brand into the project tentatively entitled: “Tree to Table: Sustainable Supply Chain Analysis for Apples and Pears” (Section 6.1.3).
Key performance indicators by 2015
Through the implementation of the domestic market plan the key requirement and concerns of consumers have been identified
Consumer issues are being actively addressed in the relevant components and projects embedded within the RD&E plan
Export market analysis has helped identify and prioritise discrete RD&E projects or approaches to be undertaken in existing projects
1.3.6 Industry Development (see Section 6.6)
Industry development has been defined by HAL as “the process of informing and empowering those in
horticulture to make better business decisions”. APAL has recently undertaken a comprehensive
consultant-led study entitled “Apple and pear industry development needs analysis”. Overall, the study set a challenge for the apple and pear industry to better focus, integrate and re-invigorate efforts and processes in the area of industry development. Taking the above study into account, the new strategic approach during 2010-2015 will involve a number of complementary priorities.
New Extension Network
There is an urgent need to integrate activities across the different States and the various industry associations into a single network; all aligned to achieve the overall objectives of New Horizons 2015. This will involve three broad approaches, operating in parallel and under the auspices of a newly-constituted National Coordination Panel. The approaches involve: reconstituting existing extension projects and personnel; an engagement with private advisors; and the development of extension packages that are integrated into the overall RD&E portfolio.
People and Leadership Development
It is proposed to enhance people skills and leadership capacity by formulating a high profile project to encourage and support the participation of keen individuals. The proposal, led by APAL, will develop a three-tiered approach and, at each level, involve both an industry practitioner (selected from growers, supply chain operatives etc) and a RD&E practitioner (selected from science, technology, extension
etc) as a pairing.
Future Orchards - Beyond 2012
The on-going strategy following a review of “Future Orchards 2012” is to upgrade, reformulate and relaunch the program as “Future Orchards - Beyond 2012” in late 2010. Any modifications or additions to the program will be formulated by the project management team and will ensure that the project remains high-profile and highly relevant to growers.
National Conference
Beginning in 2012 the strategy will be to invest in only one national conference held every two years. This event will focus on key elements of New Horizons 2015. It will provide the forum for addressing progress towards meeting the key objectives of industry’s strategic plans and embrace detailed reporting to industry in specific RD&E projects by key personnel. In addition, to complement the program the conference will present influential key note speakers from around the world and be a forum for individuals in the people and leadership development program to deliver their viewpoint. It is anticipated that this national conference will be undertaken in partnership with a variety of other bodies where appropriate (e.g. AFFCO, State industry associations, and others). Participating groups will be able to secure their own dedicated sessions or “break-out” groups as needed.
Industry Data and Analysis
It is timely to restructure gathering, analysing and communicating data and information along the supply chain into a much more integrated, streamlined and effective program.
The strategy for the 2010-2015 period is to consolidate this work under the leadership of APAL staff into a single “Apple and pear industry Data and Analysis Program” (IDAP) that itself interacts with parallel programs under investigation in the domestic market and export market programs.
IDAP will bring diverse data sets together with appropriate analysis so as to provide information to individual growers on the one hand, and broad-spectrum users on the other, tailored to their different needs.
Industry Communications
The majority of apple and pear growers perceive the overall quality of APAL communications as “good” (Ipsos Australia, grower survey 2008). However, there are mixed reactions to the usefulness, quality and extent of the different communication methods utilised between APAL, the RD&E program and the industry at large. Projects such as “Future Orchards 2010” with dedicated built-in grower contact are receiving strong feedback with regard to the level of communications. The traditional methods of general information flow via magazines, articles and now the APAL web-site have variable support. The web-site in particular appears to have a very low profile with most growers even though grower-directed articles and information can be readily accessed from that site.
The Communications Strategy 2010/2015 (that is under parallel development to this RD&E plan) will refresh the approach to industry communications beginning with an immediate independent survey of growers throughout the industry. The intent of the survey is to assess the grower needs and satisfaction with the provision of industry services. Results from this analysis will then be used to adapt the channels and content of industry communications to fulfil expectations.
Key performance indicators by 2015
The majority (>75%) of targeted apple and pear growers should rate all industry development activities highly and positively when their feedback is sought or reviewed
An extension network should be active and broadly utilised
Future Orchards should have a comprehensive plan of its on-going role and of the next
generation of activities and be undertaken with a high level of grower support and interaction IDAP will be the mainstay of the apple and pear industry’s information sources and statistics
1.3.7 Portfolio Management (see Section 6.7)
The role of RD&E in New Horizons 2015 is considered critical in enabling industry to meet its existing and emerging challenges. In response, it is timely to re-analyse the approach taken to formulate and operate the apple and pear RD&E portfolio.
The principles and issues considered in re-focussing the RD&E program have been outlined in Section 5; broadly speaking they highlight the need for a more dynamic and comprehensive approach to managing the portfolio. The activities involved in the on-going management and formulation of the RD&E plan, like the projects within the portfolio themselves, need to be better integrated and more strategic.
The following activities, managed by the RD&E Sub-Committee, will be brought together in an integrated way: evaluation of project submissions; dedicated monitoring of individual projects; exploring and analysing partnering opportunities; pro-actively interacting with RD&E co-investors; program and project evaluation; and on-going priority setting.
Integration of these activities into a single project represents a step-change in the operations of the program and will require a significant additional body of work and commitment.
Key performance indicators by 2015
The operational aspects of planning, implementation and evaluation of the RD&E portfolio will be regarded as highly professional and understood by surveyed stakeholders
A suite of new projects will have been commissioned or developed under the guidelines and approaches outlined in this plan
The evaluation of performance of the overall RD&E plan will have been critically reviewed with a positive outcome; performance indicators for each investment priority area will be assessed in this review process
A new five year RD&E plan will be developed and approved based on the present plan and accommodating the review findings
1.4 Budgets and risks
The opening budget for 2010/11 is in the order of $6.4m as matched funds; equally divided between levy funds and voluntary contributions (Section 7). By far the biggest allocations are in the priority areas of Productivity & Supply Chain (representing 28% of the overall budget) and Germplasm Improvement (representing 37%). These high levels, in both cases, are largely due to the significantly high investment (as voluntary contributions) by New Zealand’s PFR in the new PIPS project (see Section 6.1) and the recent extension of the PrevarTM project (see Section 6.3).
A key feature of the starting budget is the high level of unallocated funds ($0.94m). These funds have been deliberately kept aside to await the development of this RD&E plan in order to better guide the on-going investment.
In the 2011/12 financial year it is anticipated that the overall available funds will increase to $6.8m due to a targeted increase in voluntary contributions despite a small reduction in levy funds.
Investment is targeted to increase in the following areas:
Productivity & Supply Chain area largely by expanding the PIPS project and by staging the introduction of a new supply chain study (see Section 6.1.3)
Climate Change with the onset of a new integrated project (Section 6.2.3)
Industry Development with a re-alignment and integration of industry development activities and the re-launch the Future Orchards Beyond 2012 (Section 6.6.3)
Portfolio Management by investment in the strategic analysis of a number of new projects areas (Section 6.7.3).
The large allocation into Germplasm Improvement will remain at about the same level as the previous year but a proportion of levy funds will be needed to accommodate transitional changes (Section 6.3.3).
The allocation of levy funds invested in Market Access & Biosecurity (Section 6.4.3) and Market Research (Section 6.5.3) is the same as the previous year.
The on-going allocation in subsequent years beyond 2012 is anticipated to remain in similar proportions to that in 2011/12.
There are some significant risks associated with the five-year deployment of this RD&E Investment Plan (Section 7.2). A reduction in the grower levy due to reduced domestic sales as a result of import competition is a real possibility. In addition, a current review by the Productivity Commission is, amongst other things, investigating the matching fund model and may lead to a change in Government funding policy.
Other more general risks relate to the uncertain profitability of undertaking significant export activity and the high cost and impact of extreme heat events, prolonged drought and the consequent price and availability of irrigation water.
1.5 Overall performance
The overall performance of this plan after the five year period will have been deemed successful if the following elements have all been achieved:
The individual RD& E projects have overwhelmingly achieved their objectives and produced their contracted outputs
Where appropriate the RD&E outputs have been transferred to, and utilised by, growers to improve their individual businesses; and
The majority of targeted growers (>75%) agree that over the five year period resources were invested appropriately into effective RD&E
2. The Australian Apple and Pear Industry - an
Overview
2.1 Structure and production
The Australian apple and pear industry, with an estimated gross value of production of $450 million, is the 3rd largest horticulture industry (after grapes & citrus). In world terms, however, the 2008 yield of
265,400 tonnes of apples represented just 0.8% of world production; and for pears 127,800 tonnes represented only 1.4% of world production.
The deployment of the major apple and pear growing areas and their production (in descending order) are shown in the TABLE 1 (Source APAL). Notably, Victoria is by far the biggest producer; followed next by four States each producing around 10% of the total crop (namely, New South Wales, Western Australia, Queensland and Tasmania).
TABLE 1 - Australian and regional apple and pear production in 2008
State
Main Growing
Region
Apple (t)
(% total)
Pear (t)
(% total)
Both (t)
(% total)
Victoria Goulburn Valley & Southern 104,000 (39%) 113,300 (89%) 217,300 (55%)New South Wales Orange & Batlow 44,900 (17%) 550 (0.4%) 45,450 (12%) Western Australia Donnybrook & Manjimup 31,500 (12%) 7,420 (6%) 38,920 (10%) Queensland Stanthorpe 35,500 (13%) 650 (0.5%) 36,150 (9%)
Tasmania Huon Valley 30,200 (11%) 960 (0.8%) 31,160 (8%)
South Australia Adelaide Hills 19,300 (7%) 4,940 (4%) 24,140 (6%)
TOTAL 265,400 127,760 393,200
Productivity of Australian apple and pear orchards is not highly competitive in international terms. Australian apple orchard productivity of 15t/Ha lags well behind the world’s best such as New Zealand at 55t/Ha and Italy at 35t/Ha (World Apple Review, 2009). Australian pear orchard productivity of 25t/Ha also lags well behind the world’s better producers such as Chile at 44t/Ha and The Netherlands at 36t/Ha (World Pear Review, 2009).
Across Australia some 1100 businesses are involved in growing apples and pears. These growers are represented by Apple & Pear Australia Limited (APAL); their peak industry body. In addition, six State associations are members of APAL and play an active role in organization and issue management at the local and State levels. The Australian Fresh Fruit Company (AFFCO) is another important industry organization providing information and development services to a national network of growers.
APAL works closely with Horticulture Australia Limited (HAL), which is responsible for the investment of industry, levies for Research, Development & Extension (RD&E) and marketing (see Section 4.1.1 for details of HAL).
Australian apple and
pear yields lag behind
world leaders…..APAL
2.2 Sales and markets - a domestic focus
The apple and pear industry in Australia, unlike in many other producing countries, has a very strong domestic focus, low exports and minimal import competition.
2.2.1 Apples
Apples are among Australian consumers’ top three favourite fruits with an average of 78% of respondents to a regular industry survey having purchased apples in the past month. According to HAL, domestic consumption of fresh apples in 2007 stood at approximately 9kg per person per annum. Major supermarkets and independent retailers are the main points of purchase for consumers of apples and pears, with food service businesses accounting for a much smaller component of supply. In 2008 it was estimated that about 13% of the apple crop was used as concentrated apple juice, fresh apple juice or pie apple. Import competition is an important factor in the juice market; resulting in low prices attained by growers for fruit that is only suitable for processing. In 2008 only 1.3% of the fresh apple crop was exported overseas. No apple imports occur at present.
2.2.2 Pears
Unlike apples, pears do not occupy a position as a staple fresh fruit for Australian consumers; approximately 40% is sold fresh and the rest is destined for processing (canning).
The pear industry is subject to import competition from China, although the level of imports remains low. The industry was exporting approximately 4% of its pear production in 2008.
2.3 Trends, challenges and drivers
The Australian apple and pear industry is facing challenging times. While the industry is mature, relatively large in domestic terms and occupies established positions in domestic markets for fresh fruit, the continuation of this situation is under threat.
2.3.1 Influencing consumer demand
Comparison of fruit consumption per capita across the different countries of the world shows that Australians are not ardent consumers of apples. A summary of the estimated consumption for 2007 compiled in the “World Apple Review- 2008 Edition” is shown in TABLE 2.
TABLE 2 – Estimated apple consumption per capita in various countries in 2007
Europe (11
major
countries)
United
Kingdom
Zealand
New
Canada United
States
Australia
Average
(32
countries)
Kg/head
16.7
10.1
14.6
12.6
7.5
7.4
10.3
Although it is acknowledged that these figures are estimates only (as it is difficult to access directly comparable data sets and accurate statistics across different countries) world apple consumption has been static for more than ten years and stimulating per capita consumption remains a global challenge.
HAL and Australian Bureau of Statistics (ABS) data for 2007 show Australian per capita consumption of apples at 9.99 kg/head and for pears 3.75 kg/head. Whatever the exact figures, it is clear from TABLE 2 that Australian consumption is on average lower than in many other countries (notably half of New Zealand’s in the above analysis) and below the average of all 32 countries studied.
Maintaining and growing consumer demand is essential for a mature industry that has a large, sunken investment. However, there is evidence that accompanying the low consumption base in world terms, the Australian apple consumer is not highly engaged and purchase is driven primarily by habit. In addition, there is a widespread perception that fruit quality is variable. On the supply side an emerging factor on the domestic apple market is oversupply. Similarly, for pears, market evidence suggests that consumers are
disengaged; with the fruit often forgotten, seen as boring or simply unripe and too difficult to handle and consume.
The challenge presented by competing fruits is also a serious factor. For example, the availability, presentation and quality of Australian summer-fruits, cherries, and mangoes are having an impact on apple and pear sales. Moreover, table grapes and cherries imported from California have made significant in-roads into the Australian retail market in recent years.
The apple and pear industry has recognised these various challenges and implemented tailored promotional programs in response. The most important factor will be to improve the quality of the product (as opposed to the promotion of it) to ensure the industry meets or exceeds consumer expectations. Continuing the shift to new varieties that interest the consumer and progressively reducing the supply of older varieties is also an important part of repositioning the product over time.
2.3.2 Threat of imports
The potential for apple imports is the key uncertainty facing the industry. While this has been a threat for many years, the almost unanimous expectation amongst key players in the industry is that apple import competition will become a reality within a year or two. In the absence of industry action to improve competitiveness, fresh apple imports have the potential to reduce Australian domestic market share by up to a third and the returns to the industry by up to 40%.
2.3.3 Lack of an export culture
The industry has only a minimal profile in export markets and lacks a committed export culture. Growers see their high labour costs to grow premium quality as their key disadvantage in that highly cost competitive market. Lately, high labour costs have been exacerbated by unfavourable $A-exchange rates.
In fact, despite the perceived imperative to export, the volume of Australian apple exports decreased from 36,700t in 2000 to 3,353t in 2008. Present Australian apple exports are limited to high value Pink Lady™ to the United Kingdom and commodity-style apples exported to some Asian markets.
In the same period pear exports declined from 19,908t to 5,157t.
2.3.4 Addressing the environment and sustainable production
As with all agricultural industries, the apple and pear industry is increasingly facing a number of environmental challenges.Growers and consumers of food crops alike are progressively more compelled to be concerned about sustainable farm practices, particularly with regard to soil condition, water usage, pest management and chemical usage.
Moreover, climate variability, climate change and government policy measures in response to them will also influence the direction of the apple and pear industry. Environmental-, carbon- and water-friendly practices, both on-farm and along the supply change, will continually need to be adapted to meet increased consumer concerns.
Between 2000 and 2008
apple exports dropped
by 90% and pear exports
by 75%…..APAL
Australian apple and
pear consumers are
disengaged and not
always satisfied…..HAL
3. Apple and Pear Industry Strategic Plan - New
Horizons 2015
3.1 Developing the plan
In March 2010, APAL endorsed the apple and pear industry strategic plan called New Horizons 2015. The purpose of developing the new industry strategic plan was to:
1. develop a shared understanding on the overall direction, key strategic issues and the critical actions required to influence the profitability, resilience and sustainability of the industry in the medium to long term
2. guide the investment of research, development and marketing funds provided by both apple and pear growers and the Australian Government from 2010 - 2015
3. enable allied service providers such as the public and commercial research and development community to align their resources and effort with that of the industry
4. demonstrate to consumers, customers, the community and government the positive actions the industry is taking in response to shifting demand and vigorous competition.
The process of developing the plan was guided by an APAL/HAL industry steering committee. Consultation with industry was comprehensive, involving regional focus groups as well as dialogue with individual industry participants along the supply chain.
Those priorities most likely to have an impact on the profitability and sustainability of the industry were rigorously tested using a needs analysis approach. In addition the Hi-Link Model (developed by the Centre for International Economics and used in the horticultural industry’s Future Focus program) was utilised to explore the sensitivities of different scenarios.
3.3 Strategic plan highlights
The Highlights of New Horizons 2015 are shown in FIGURE 1.
Analysis of the positioning of the apple and pear industry in the global market
place highlighted that transformational change is needed. The imminent challenges facing industry are multi-faceted. They include: consumer dissatisfaction with fresh fruit; competition by other products or imports; the imminence of apple imports; and environmental impact pressures.
It was recognised that substantial change can only occur with effective communication and collaboration with other groups such as industry associations, governments, growers and supply chain businesses, all acting collectively.
The following three key areas for co-ordinated action have been identified in New Horizons 2015: 1. stimulate domestic demand by 5 per cent through product quality and innovation
2. expand apple and pear export markets to 10 per cent of marketable product by 2015 3. ensure industry has the resources and capability to achieve its primary objectives
The overall objective and vision of the 5-year plan is to deliver the apple and pear industry to a status of world competitiveness, profitability and sustainability by 2015.
Business as usual is not
an option…..APAL
FIGURE 1 - The apple and pear industry plan on one page - New Horizons 2015
Primary Objectives
Industry Strategic Intent
What: To consistently produce apples and pears of superior eating quality, focusing on varieties that are sought after by consumers
in the domestic market and selected overseas markets where premium quality is valued
How: By industry and government stakeholders working collaboratively to reposition the apple and pear industry and transform
competitiveness by delivering valued services that support innovation Consumer demand for Australian apples and pears is in decline. Domestic competition from a variety of local and imported fruits has intensified.
Imported apple juice concentrate dominates the domestic market and limits the local market for lower quality fruit. Competition from imported fresh apples is likely within the next year or two.
Apple and pear exports are declining rapidly.
Grower numbers and profitability are declining as costs rise and market share shrinks. The industry could contract by 20-40 per cent within five years, even with a proactive industry response.
Climate change and environmental issues are placing pressure on sustainable farm practices and consumer-retailer perceptions
The Reality in 2010
The Australian apple and pear industry is world competitive; satisfying consumer demand for its
products and with sustained profitability
The Reality in 2015
1. Stimulate domestic demand by 5% through productquality and innovation
1.1 Improve consistency of product quality to match consumer expectations.
1.2 Enhance orchard productivity and management 1.3 Coordinate industry product promotion and marketing programs
1.4 Facilitate variety transition to match changing markets 1.5 Enhance industry value within the community
2. Expand apple and pear export markets to 10 per cent of marketable product exported by 2015
2.1 Define and understand overseas markets that offer profitable export opportunities
2.2 Develop collaborative approaches to enter and expand selected export markets
2.3 Resolve technical market access issues in target markets 2.4 Monitor export market competitor activities
3. Ensure industry has the resources and capability to achieve primary objectives
3.1 Adapt industry services to meet changing needs of growers
3.2 Improve quality and flows of information for decision-making across the supply chain 3.3 Invest in leadership and people development
3.3 Strategic plan details concerning RD&E
New Horizons 2015 identifies a suite of strategies and approaches to tackle the three key themes
identified. Many of them concern product promotion and marketing activities which are outside the scope of this apple and pear RD&E plan. Similarly, those that involve industry in strictly business activities along the supply chain are not addressed further here. Yet another area involving general industry communication and interaction with government on policy and regulation are in the realm of activities conducted by APAL itself.
What is of concern here are those strategies and activities that can be addressed by a co-ordinated RD&E approach, which includes market research.
These three priority areas, transcribed in TABLE 3, have been adapted to highlight the RD&E approach that will be required to meet the performance target.
TABLE 3 – Key RD&E Priorities and targets of New Horizons 2015
Key Objective
Main RD&E Strategy
Target by 2015
1. Stimulate domestic demand Improve product quality, productivity and variety transition Increase demand by 5%2. Expand exports Understand target markets and resolve technical access barriers Increase exports by 10%
3. Enhance Industry capability Adapt services to deliver quality information and promote leadership Increased grower satisfaction
3.3.1 Priority 1 - Stimulate domestic demand
Given the almost complete reliance of the industry on domestic markets this priority is of paramount importance. The approaches needed to improve domestic demand broadly involve: improved and consistent quality; higher yet sustainable productivity; and introduction and transition to novel varieties. The need to assess and monitor consumer behaviour is also identified.
3.3.2 Priority 2 - Expand exports
The almost complete lack of an export culture in the Australian industry is a major barrier to the development of new opportunities beyond the domestic market. Movement along this front is considered particularly difficult as it requires operating under extremely competitive pricing. The approaches largely depend on identifying overseas opportunities, making the right commercial liaisons (both in Australia and overseas) and ensuring product quality and market access issues are addressed.
3.3.3 Priority 3 - Enhance industry capability
None of the RD&E approaches identified to enhance market penetration will succeed unless growers themselves can adapt and adopt the necessary practices and technologies. The challenge and objectives for this enabling priority involve improved motivation, communication and knowledge transfer to individual growers and the consequent development of leadership and skills competency.
4. Key Stakeholders, their Strategic Plans &
Co-investment
4.1 Partners’ strategic plans & objectives
The business and operational activities of the apple and pear industry do not occur in isolation. Strong strategic alliances and partnerships exist along the entire production and marketing chain. RD&E, perhaps more than in any other activity, requires close collaboration and co-investment to be effective. Key agencies that will continue to be partners with APAL in delivering its RD&E outcomes include:
Horticulture Australia Limited Australian Government
government research providers from around Australia private sector & international research providers
Each of these major funding partners in the apple and pear RD&E portfolio has a commitment and role to invest in, sponsor or conduct research. A prerequisite for co-investment is a shared vision between collaborators. Therefore, when constructing the RD&E portfolio and its individual projects, the strategic objectives of all contributing parties must be addressed.
4.1.1 Horticulture Australia Limited - Strategic highlights
Horticulture Australia Limited (HAL) is a not-for-profit, industry-owned company. Its major role is to manage the expenditure of levy funds collected by the Australian Government on behalf of horticulture industries. When expended on RD&E (but not marketing and promotion), these levied funds are matched by the Australian Government. HAL is responsible for all decisions
relating to the expenditure of levy funds to the Department of Agriculture, Fisheries and Forestry’s (DAFF). Where it is deemed that appropriate benefits accrue to the general apple and pear industry, HAL is also responsible for investing Australian Government funds alongside private sector or overseas funds (as voluntary contributions; VCs).
As a general guide, the annual level of matched funds managed by HAL is expected to be in the order of $6m; $3m from levies and another $3m from VCs.
In HAL’s Draft Strategic Plan 2010-2015 the key strategic priorities, RD&E investment programs and outcomes over the next 5-year period are presented in TABLE 4.
TABLE 4 - HAL priorities, RD&E programs and outcomes
HAL Strategic Priority
HAL Investment Program
HAL Major Outcomes
Deliver new information & knowledge Best practice on-farm management Natural resource managementValue chain efficiency
New product development Increased knowledge that enhances productivity, competitiveness and sustainability
Enhance industry skills & capability On-farm R&D extension Investing in people Targeted communications Enhancing industry capability
Build consumer demand Domestic marketing program International market access Promote health and well-being New product and market development
Increased demand for produce in both domestic and international markets
HAL will invest >$30m in
the next 5 years into
apple and pear RD&E
4.1.2 Australian Government - Strategic highlights
The Australian Government’s support and encouragement for effective RD&E is largely delivered through two of its Departments:
The Department of Innovation, Industry, Science and Research (DIISR) which has developed its National Research Priorities (reviewed June 2009).
The Department of Agriculture, Fisheries and Forestry (DAFF) which has formulated its Rural Research and Development Priorities (2007) to be a guiding document up to 2017.
HAL has an obligatory reporting arrangement and accountability to DAFF with respect to its RD&E investment decisions.
The combined strategic priorities for RD&E for the Australian Government which are applicable to the period 2010-2015 are shown in TABLE 5. The Australian Government is increasingly seeking outcomes from its co-investments that demonstrably meet one or more of these priority objectives.
TABLE 5 – Australian Government RD&E priorities (2010-2015)
National RD&E Priorities
(DIISR)
Rural RD&E Priorities
(DAFF)
Promoting and Maintaining Good Health
Productivity and Adding Value
Improve the productivity and profitability of existing industries and support the development of viable new industries.
Supply Chain and Markets
Better understand and respond to domestic and international market and consumer requirements and improve the flow of such information through the whole supply chain, including to consumers.
An Environmentally Sustainable Australia
Natural Resource Management
Support effective management of Australia’s natural resources to ensure primary industries are both economically and environmentally
sustainable.
Climate Variability and Climate Change
Build resilience to climate variability and adapt to and mitigate the effects of climate change.
Safeguarding Australia Protect Australia’s community, primary industries and environment from Biosecurity biosecurity threats.
Frontier Technologies for Building and Transforming Australian Industries
Innovation Skills
Improve the skills to under take research and apply its findings. Technology
Promote the development of new and existing technologies.
4.1.3 Government research providers - Strategic highlights
Government agencies from across Australia, which include various State and Territory Departments, Universities and CSIRO, have in the past been the main research providers and co-investors in the apple and pear RD&E portfolio. In addition, though to a much smaller extent, some collaboration and co-investment occur with other Government-backed agencies (e.g. ACIAR, RIRDC and DAFF). In the time frame of this RD&E plan it is expected that the relationship with the major agencies will continue to a similar degree of commitment and resourcing. However, a major change in the way these partners engage with the apple and pear industry is at hand.“Research & innovation
are vital for Australia’s
primary production &
food industries”… DAFF
The major research provider agencies have for many years (since 2001) operated a formal network of senior horticultural RD&E managers together with representation from HAL. This National Horticultural Research Network (NHRN) was established to provide strategic leadership and a forum for consultation, communication and coordination across horticultural RD&E.
In 2007 the NHRN was commissioned on behalf of the Australian Government, represented by the Primary Industries Ministerial Council (PIMC) and its Primary Industries Standing Committee (PISC), to formulate a “National RD&E Framework for Horticulture”. The vision being to:
facilitate greater coordination and capability amongst Agencies and Industry better harmonise RD&E and ensure effective collaboration without duplication maximise the net benefit to Australia.
The process of developing the comprehensive framework was not completed until February 2010 and is not expected to be formally ratified by PISC and PIMC until September 2010.
The major outcome of the process has been the identification of the future strategic directions of individual agencies; their preferred science competencies and the scale of resource commitments for each Horticultural Industry/Commodity Grouping.
Based on 2008-09 figures, NHRN has estimated that the total annual
investment in apple and pear RD&E was $10.015m; 53% funded by HAL/apple and pear industry and 44% by State Government agencies. Only 15% ($0.803m) of the funds went directly to support State agency RD&E; the rest ($4.529m) was invested to support the activities of APAL, grower groups and private sector parties.
The NHRN has qualified the individual agency roles, estimated 2008/09 investment in RD&E and discipline support area for the apple and pear industry (TABLE 6).
TABLE 6 – Role, past RD&E investment and preferred discipline area for State agencies articulated in the “National RD&E Framework for Horticulture”
Strategic Role
State Agency
2008-09 Investment Discipline Area
Major Priority RoleDepartment of Primary Industries
Victoria (DPIV) Agency $1.203m HAL $0.312m Other $0.139m
Plant Health Crop Production Environment
Support Role
Department of Agriculture and Food
Western Australia (DAFWA) Agency $1.402m HAL $0.026m Other $0.017m
Breeding Queensland Department of
Employment, Economic Development & Innovation (QDEEDI)
Agency $0.442m HAL $0.360m Other $0.004m
Crop Production
Industry and Investment NSW (IINSW) Agency $0.729m HAL $0.031m Other $0m
Plant Health
Industry Development Tasmanian Institute of Agricultural
Research (TIAR) Agency $0.543m HAL $0m Other $0.033m
Environment
Link Role
South Australian Research and
Development Institute (SARDI) Agency $0.063m HAL $0 Other $0.108m
Extension
State agencies
contribute ~44% of the
funds for apple and pear
The “Strategic Role” in the first column of TABLE 6 is defined as:
Major Priority Role: a national leadership and coordination role where there is a major priority for the relevant government agency which endeavours to give a high priority to funding research capability, including infrastructure, for that sector
Support Role: the agency undertakes research, but not leadership, in collaboration with and complementary to the major priority role
Link Role: the agency will undertake little or no research but access information and resources from other parties to meet industry needs and in support of other agencies
By the above definition and analysis, NHRN has determined that DPIV will function as the formal point of contact with the apple and pear industry/APAL. The role, when fully operational, would include one of leadership and coordination across the entire network of RD&E provider agencies.
4.1.4 Other RD&E providers - Strategic highlights
There has been substantial investment in RD&E with providers other than State Government agencies. NHRN has estimated that the annual investment by HAL/apple and pear industry in this sector is in the order of $4.3m per year. The majority of RD&E projects funded in this way are those involved in the area of industry development. Most are extensions of APAL roles to directly service industry with information, training and technology transfer. Another series of projects concerns high-order issues in horticulture that sensibly require a whole-of-industry approach with a contribution from the apple and pear industry (e.g. the “across-industry program”).
Notwithstanding the above, there remains a large proportion of RD&E investment and projects that are undertaken in collaboration with the private sector and international agencies. These RD&E providers are recruited to provide specialist skills, services and consultancies not usually available from the State Government research providers.
The motivation to engage overseas providers involves the need to recruit RD&E teams that are already experienced, with both infrastructure and technology available to have an immediate impact on the task at hand. In this respect, the apple and pear industry has, to date, a number of major projects underway with RD&E teams based in New Zealand, notably Plant & Food Research (PFR).
It is anticipated that the apple and pear RD&E portfolio will continue to tap into this external expertise with co-investment utilising the voluntary contribution funding mechanism (see Section 4.2.2). The documented prerequisites are that all such collaborations with overseas providers must be in partnership with the Australian apple and pear industry and be able to demonstrate a clear benefit, including transfer of technologies and/or “know-how”, to raise the capability of Australian users.
4.2 Overview of funding and priority setting
The process by which the apple and pear industry sets and funds its RD&E priorities through collaboration and co-investment with other parties is outlined in FIGURE 2.
4.2.1 Priority setting cycle
The priority setting cycle is outlined on the right-hand side of FIGURE 2.
The process is largely driven by the development of the apple and pear industry strategic plan under the auspices of the Industry Advisory Committee (IAC). The IAC is a committee of HAL that provides advice to the HAL Board; membership is recommended by APAL. The current apple and pear strategic plan, called New Horizons 2015, has been outlined in detail in the preceding Section 3. As a consequence of the development of this strategic plan the IAC, through its various sub-committees, undertakes the development of a number of operational plans. In the past, one of these is
In 2010 three major
projects are underway
with NZ-based RD&E
providers…..APAL
the Annual Investment Plan which, amongst other things, outlines the RD&E priorities for submission to HAL and as a guide to potential research providers.
A major change to this process is indicated by the development of this present document. The apple and pear IAC has decided to release a five-year RD&E Investment Plan alongside, and underpinning, its strategic plan. This five year plan has been developed co-operatively with IAC, industry, HAL, APAL and key Government research providers (represented by NHRN).
An on-going function of the RD&E Sub-Committee of the IAC is to analyse and provide recommendations to HAL for the funding and implementation of individual projects that collectively make up the apple and pear RD&E portfolio.
The principles, issues and priorities guiding this process are the subject of Section 5; with specific priority investment areas detailed in Section 6.
4.2.2 Funding cycle & investment model
Co-investment by partners, such as those participating through the NHRN, together with industry and government (through HAL) is the key element in combining funds to effectively tackle priority RD&E. The process is outlined on the left-hand side of FIGURE 2.
FIGURE 2 - The funding and priority setting cycle for developing the RD&E project portfolio Matched funds
$
Horticulture Australia Limited Government RD&E Providers (NHRN) Private Sector Providers (participating as Voluntary Contributors) Australian Government (DAFF) Levy funds Matched fundsApple & Pear Growers
Priority RD&E projects
Outputs that benefit industry
FUNDS
PRIORITIES
Advice & representationApple & Pear Australia Limited (APAL) Advice Industry Advisory Committee (& RD&E
Sub-Committee) Horticulture Australia Limited Government RD&E Providers (NHRN) Co-invested funds RD&E Investment Plan Co-operative planning
DELIVERY
Industry Strategic Plan (New Horizons)$
$
$
Project development & agreement4.2.3 HAL funding
The current funding model for investment in apple and pear RD&E is coordinated under the auspices of HAL. In general terms, industry or private sector funds can be matched (on an $A for $A basis) with Australian Government funds (via DAFF) for approved projects.
Projects funded through HAL always involve, at least in part, a combination of:
statutory levies (marketing and RD&E) from apple and pear industry levy payers. HAL is accountable to levy payers and to the Australian Government for the expenditure of levy funds. For detailed information see: “Investment of Levies for Australian Horticulture - Roles and Responsibilities”
voluntary contributions (VCs) received from private sector providers; including grower associations, commercial enterprises, overseas research providers and individuals
Australian Government matching funds for expenditure on RD&E up to 0.5 per cent of the gross value of production for the total horticulture industry.
Although industry levied funds and volunta
