Kent-based Westfalia Fruit Group has landed £242 million in funding from three banks that it says will be used to boost sustainable avocado production.
The infusion of capital from HSBC UK, the International Finance Corporation (IFC), and Standard Bank will help Westfalia expand and improve packaging, ripening and storage. But it also will help it “explore new markets.” Currently, Westfalia boast orchards and nurseries in Colombia, India, Chile, Mozambique, Peru and South Africa.
“This investment will enable Westfalia to continue to grow its business, strengthen value chains to sustainably produce and source quality avocados, and improve access to export markets to meet the growing demand for the fruit,” Alk Brand, Group Chief Executive Officer at Westfalia Fruit Group, said. “The partnership with HSBC UK, IFC and Standard Bank will contribute to our efforts to enhance sustainable farming practices, create jobs in the communities where we operate, and support economic growth. I am ready for a transformational year in 2023.”
“The global fresh fruit market is expected to grow by 5.53% annually, and this funding will help to meet rising demand and grow the global agriculture sector, providing new jobs across Africa, South America and India,” Danny Goldblum, Head of Large Corporate Coverage at HSBC UK, added. “We also look forward to seeing the business continue its sustainability efforts and meet its net zero targets in 2030.”
The current avocado market is said to be £7.2 billion and expected to grow to £16.6 billion by 2026. Aside from the massive potential on the investment side, lenders were quick to point out the other benefits of the deal.
“Developing sustainable avocado markets can help boost agriculture productivity to reduce poverty, especially in rural areas where people mainly work in farming,” Adamou Labara, Country Manager for South Africa at IFC, said. “IFC’s investment in Westfalia will help increase avocado production to meet growing demand, strengthen global value chains and boost economic growth in developing countries.”
To that end, Westfalia said it will continue the use of “smart growing techniques” to limit energy and water consumption and also infuse drought and disease-resilient avocados in the coming years.