Fresh horizons

NKW Fresh, a division of the landowner-owned conglomerate NKW Holdings, is providing fresh produce across PNG and is aiming to export in the region.

Many farmers are now earning in excess of PGK50,000 a year.

David Stewart, divisional manager for Fresh Produce in NKW, says that the company has a moral duty to develop some economic opportunities for surrounding communities post-mine life for the Hidden Valley Mining Project in Wau.

NKW’s fresh produce business was established in 2014. It was created to complement NKW’s catering services, and as part of a diversification strategy.

NKW Holdings provides services to the mine project. Its operations include construction, consulting, catering, transportation and project management.

The company employs over 1000 staff and has a net worth in excess of PGK200 million.

NKW’s Fresh division sources produce from local smallholder vegetable farming households, which is then supplied to its

catering service and other markets, including supermarkets and catering companies.

NKW Fresh buys 60 metric tonnes of fresh produce each month and deals directly with smallholders, rather than traders, in order to include local farmers.

“We now have the only effective cold chain (refrigeration) for fresh produce in PNG,” says Stewart.

“We run two eight tonne refrigerated trucks up and down the Wau road in Hidden Valley coming back into Lae.”

Developing sufficient scale remains a persistent challenge, according to Stewart.

“I often have to say to farmers: ‘I don’t want to buy six watermelons at five kina each’. We are not looking at the subsistence level; we need to bring the farmers into the commercial level.

“I want to buy a ute-load of watermelons and give the farmer PGK100,000 a year.”

Stewart adds that many farmers are now earning in excess of PGK50,000 a year.

“Three to four years ago, it would have been less than PGK5000 a year,” he says.

Stewart believes it is necessary to improve the supply chain if the division is to develop new markets.

“We can’t just keep putting on farmers. At some stage what we need to be doing – and we have been trying to do this in the last six months – is developing those farmers’ personal capital.

“They need to start putting money aside for mechanising, and asking: ‘How do I make sure I get that amount again?’

“It is that personal capital that creates the disciplines that will produce a sustainable supply arrangement into our markets.

“And it is starting to happen. We have got farmers starting to buy machinery, we have got farmers who are not spending their money but putting it aside for the bank.”

The aim, says Stewart, is to export fresh produce from PNG into the South Pacific, Australia, Singapore, even into China.

“That idea is very high on our radar – if it doesn’t remain high, then we don’t have goals. If we don’t have the goals, then we won’t put the right systems in place and we won’t keep pushing.”