When Kerry Smerdon first bought his 100-acre property in Queensland's Glass House Mountains in 1992, it was home to pineapples, avocados and a plethora of fruits used for nursery cuttings including jackfruit, blueberries and litchis. On the hills were a few macadamia trees but the amount was "bugger all".

Smerdon's property with Mount Coonowrin (also known as Crookneck) in the background.

Much has changed since then. The native nut now occupies almost half the farm near Mount Coonowrin with more plantings set to replace remaining avocado trees that survived the 2011-12 floods, complementing 15 acres of another high value crop, custard apples (cherimoyas).

"Going back when we first planted them [macadamias] nine years ago there was an oversupply and there wasn't a really good marketing campaign put forward for the supply of the nuts," Smerdon says.

"There's been a bit of a shortage in the last couple of years which has pushed the price up and there have been exports to China starting up, nut-in-shell, and that's helped out.

"There's also been a better overall marketing campaign of marketing Australian nuts over South Africa's. Prices went from AUD$1.60 (US$1.39) a kilo (2.2lbs) up to AUD$3.40 (US$2.97) a kilo this year."

Even though the property's first large-scale macadamia trees were planted almost a decade ago, they are still considered to be young with a wait of 3.5-6 years from the grafting of seedlings to the first harvest, depending on the variety. Some leaves are looking a bit dry and the farmer is considering installing irrigation systems, but to date he has been able to rely on rainfall, good temperature and hard work.

He also has a family farm at the base of Mount Beerwah where he grew up working with pineapples, but that land has now crossed over entirely to macadamias.

"When I was at school I swore I'd never come back to the farm because all we grew was pineapples and I hated them," says Smerdon, who returned to horticulture after a brief stint at university and was to supply processor Golden Circle with the tropical fruit until 2006.

"One thing that used to get me about pineapples is that you’re always preparing ground, you're always hoeing in a patch, planting, but for trees once they’re planted and established they're just there basically. You don't have to rip them out in three or four years’ time and start again."

Another impetus for the shift is labor costs, which Smerdon describes as "ridiculous" in Australia.

"We pay AUD$20.50 (US$17.88) an hour just to strip leaves off a [custard apple] tree, so labor is a huge issue," he says.

"The nuts naturally drop on the ground, so all we have to do is go through with machines and pick them up off the ground. We've got around 7,000 trees and the whole nut production can be done by one person," he explains, adding that all growers sell to processors who take off the husks and sell the nuts in-shell.

"In South Africa they can pay their blokes a lot less than us to pick them up by hand but we have to invest. We have to mechanize as much as we can to keep the labor cost down."

Photo: www.shutterstock.com

Harvesting finished early around late July on the property as the trees are so young. Since then they've been flowering and the next big task will be conducting an orchard clean-out in late January or early February before it starts raining, prior to the March harvest.

Keeping macadamia orchards clean and protected from pests

As harvesting is on the ground, Smerdon has to keep the orchard floor spotless.

"You can see the roots starting to show themselves, because we’ve got to blow the nuts out through under the tree, and you’re pushing the topsoil out," he says.

"There are ways around that though once it gets too bad. You can put soil under the tree."

The other challenge is keeping pests and diseases - including flower caterpillar, husk spot, botrytis, fruit-spotting bug and nut borer - under control, and adapting spray programs to constantly changing chemical regulations.

"We lose a chemical every year because someone gets a bee in their bonnet about it, but used correctly they're relatively harmless," he says.

"Endosulfan is a chemical we had for years, but we lost it a few years ago and we've struggled to find a chemical as good as that."

He says one replacement pesticide, Lepidex, does very little for protection, while trying out other pesticides can also be difficult due to registration problems.

"Some of the chemicals they bring to replace it are worse than the chemical that got taken off you, so you've got to change your ways to try to find what's best.

"You can’t just go out and use another chemical. It's actually got to be registered for that crop.

"A chemical can be registered for say tomatoes or broccoli where you eat the skin, but it's not registered for macadamias, where it goes through a husk and a shell before you eat the actual nut. There's not going to be chemical residue on it but you can't use it if it's not registered."

The 'custards'

While Smerdon doesn't have too much land dedicated to custard apples, this small amount of trees makes him one of Australia's largest growers of the niche fruit.

Photo: www.shutterstock.com

"Most of our custard apples go to Melbourne. We also export them when the dollar allows us to, going to places like Singapore, Dubai and Vietnam," he says.

"We’ve only been growing them for 12 years now, and demand certainly has increased since we planted them.

"It's a high value crop and it's got to be for the amount of labor you put into it," he says, adding the farm brings in a steady stream of backpacker workers for tree stripping and pruning for 10 weeks, and about 25-30 pickers during the harvest which roughly coincides with the macadamia season.

He emphasizes the fruit is "all fresh" and transported via airfreight.

"When the dollar’s high we just can’t export because we’re looking at about the AUD$40-50 (US$34.90-43.60) mark for a 7-kilo tray. By the time the consumer overseas buys it they’re looking at an equivalent to US$120-130 a tray so it just becomes too expensive for them.

"This year we exported a few. Last year I don’t think we exported any, and the year before we might have exported a little bit, but because the dollar was so high there was no demand there."

When asked whether he plans to buy up more acreage for macadamia or custard apple production if strong market conditions continue, Smerdon says it all depends on financing.

"We’re with Rabobank which focuses on primary production. They haven't hassled us at all," he says.

"I know there are a lot of people out there who are really struggling with their banks, and I guess it’s just something that happens with the weather we've had.

"Chemicals and fertilizers keep going up, but we don’t necessarily get an increase in our price. We're price-takers, we can't send to the market and say you have to give us this much."

While this position as a price-taker means life isn't always easy, Smerdon says he gets by. Fortunately, rumors abound that prices in China could stay at this year's levels in 2015 or go even higher.

"You’ve got to grow things no one else is growing. Nuts are fairly wide-scale but custard apples are not widely grown," he says.

Related story: Staying competitive is key for Australia's native nut

www.freshfruitportal.com