NEXT time you pick a salad mix off the supermarket shelf, there’s a good chance your lettuce, spinach and rocket started life at Anthony Houston’s farm.
Nestled near the historic town of Richmond in the Coal River Valley, Tasmania, workers at Houston’s Farm are cutting lettuce seven days to supply 80,000 cartons of the green stuff each week to supermarkets, including Woolworths, and restaurants.
Thirty years ago a visitor would have seen dusty ground, hens and sheep rather than lush neat rows of green.
The region was virtually all dry land farming before the Craigbourne dam brought water to a valley now famous for wineries as well as lettuce, stone fruit and vegetables.
“People think of Tasmania being wet, but down near Hobart there’s a rain shadow and it’s very dry,” Mr Houston said.
When his family emigrated from Ireland to Tasmania in 1957, Anthony’s father had just
$35 in his pocket.
They relied on the charity of two local farmers who gave the Houstons a house and some land.
“We had 24,000 hens and some sheds on 200 acres but the land was pretty much useless,” he said.
The dam changed everything.
Houston’s Farm used to turn over $1 million a year from eggs.
The turnover from lettuce is $50 million.
“We also had 400 sheep, but the biggest wool cheque I ever received was $40,000. It is phenomenal what water can do down here,” Mr Houston said.
Australians are not in the habit of looking for business success stories in Tasmania, a serial economic underperformer.
Mr Houston thinks that’s about to change. And he’s not the only one.
“We are on the cusp of something really exciting,” says Michael Bailey, chief executive of the Tasmanian Chamber of Commerce and Industry.
“I’m more hopeful than I have been in a long time.”
Just as upbeat is Chris Oldfield, the chief executive of Tasmanian Irrigation and whose projects are turning once marginal farm land into solid export industries.
“For the first time in years there is a vibrancy in this State,” Mr Oldfield said.
Headed in the other direction are more tourists; in 2014 Chinese nationals were, for the
first time, the biggest foreign tourist group to visit Tasmania.
One of them was the Chinese President Xi Jinping, who dropped by before the G20 summit in November.
Among Mandarin classes with schoolchildren and meeting cuddly furry animals, Xi and Madame Peng Liyuan had lunch at Government House where they dined on Tasmanian abalone, beef fillet, confit Atlantic salmon with golden delicious apples wrapped in Woodbridge Applewood cold smoked ocean trout, and quail studded with truffles.
A month earlier the ASX welcomed salmon producer Huon Aquaculture to its boards in a $400 million float. It follows Tassal, another salmon farmer whose shares over the past two years have increased threefold.
It’s now a $560 million whopper. A key piece in the food puzzle is the work being done by Tasmanian Irrigation, a public-private partnership developing and managing government-subsidised irrigation schemes across the State.
“We have seven schemes up and running and three in construction that will be finished by April,” said chief executive Chris Oldfield.
“We deliver water into areas of traditional irrigation where there is no security of water or it is too expensive. We also bring water into new districts.”
As the water starts to flow, tracts of dry country across the State are being converted to higher value use such as dairying.
China alone is expected to face a shortage of about 20 billion litres of milk by 2020.
Australia currently produces a little over 9bL of milk a year.
All along the Midland Highway, barren sheep country is becoming prime dairy land.
Trevor Westacott, managing director of Australia’s oldest dairy the Van Diemen’s Land Company, says the investment in dairy manufacturing is already happening.
“Down in the Midlands there is an opportunity to do what they’ve done in the South of
New Zealand,” he said.
“There is wonderful opportunity in Tasmania.
“The Circular Head area has no equal, in my view it is absolutely ideal for dairying.”
In the valley neighbouring Houston’s Farm, another irrigation scheme is set to come on
in early 2015.
Mr Houston says he will be planting crops there in May and cutting in September, and he expects his neighbours in the Coal River Valley to follow suit.
“The extra water is a huge boom for Tasmania – we’ve really got an opportunity, and it’s not just staring at us, it’s actually happening,” he said.
Many Tasmanians point to President Xi’s visit as an event that underscores the State’s enormous potential.
Those scratching their heads at why the Chinese president decided to visit Australia’s smallest State would probably be just as perplexed by the Bobbie Bear phenomenon – a purple teddy bear stuffed with lavender and wheat that this year took the Chinese market by storm.
The bears, sold from the gift shop of the Bridestowe Lavender Estate north-west of Launceston, had to be rationed.
Shipping and internet sales were stopped, counterfeit production soared and visitors to the farm surged.
In April the story of Bobbie Bear made the front page of the Wall Street Journal.
Farm owner Robert Ravens says: “We’re not aiming to dominate the world of fluffy bears. Our business is lavender, but somehow we’ve tapped the cultural psyche of 30-year-old Chinese ladies.”
One was given to Mr Xi during his visit.
Bank of America Merrill Lynch chief economist Saul Eslake, who grew up in Tasmania, says the State needs to focus on premium, highly differentiated goods and services that can command premium prices.
“That’s the only way you can overcome the insuperable difficulties of doing things in Tasmania: small scale and distance,” he said.
“It can’t be lower wages or input costs.
“It has to be high quality and brand reputation that customers are willing to pay high prices for.”
Mr Eslake points to the fine wool produced in the Midlands, which can command about five times the price of other wool, and higherend wines as examples.
“Wine is a growing industry. They are not trying to sell it for $8 a bottle in British or American stores, they are selling for $35 a bottle.
“Small production runs at high margins,” Mr Eslake said.