Kiwifruit vines across New Zealand, particularly the green Hayward variety, are being pulled out of the ground by growers concerned the fruit doesn’t have a commercial future.
In an effort to address their worries, Zespri acting chief executive Lain Jager recently completed 16 meetings in 10 days with growers to look at the profitability of New Zealand green kiwifruit, according to The Nelson Mail
This year growers in the Nelson region pulled out green kiwifruit vines that would have produced around 200,000 trays of fruit next season. The vine removals will eventually take a 4m tray chunk out of the region’s production. The growers are switching to hops or apples, or grafting on gold kiwifruit.
Per hectare returns on the Hayward variety, the most common kiwifruit produced and marketed under the Zespri Green moniker, barely broke even for many of the country’s growers last season.
According to Zespri, the cost of production is about NZ$22,000 per hectare. Last year, farm-gate returns for green kiwifruit averaged only NZ$24,051. Returns this year fared better, at NZ$30,590.
The profitability of New Zealand’s green kiwifruit industry has fluctuated for a number of reasons; production in the last two years has shot up by 14m trays, for a total of 75m, but international markets for the fruit haven’t grown as quickly.
A strong New Zealand dollar last year also cut back on export profits; the rise in returns this year is in part attributed to a fall in the exchange rate.
The rising cost of oil has also whittled down profits, costing NZ$0.25 more per tray than last year. “That has been disappointing for growers, as it has taken what would have been 85 cents and made it 60 cents,” said Mr Jager.
When addressing the concerns of growers, Mr Jager points out that the growth of production has plateaued, but emerging markets for New Zealand kiwifruit like China and Eastern Europe are still growing.
“We recognise that green returns remain at modest levels despite the exchange rate relief of this year,” Mr Jager said. “And while we expect further relief from exchange rates over the next couple of years, we all need to focus on the profitability of the green business.”
“For Zespri, that’s about market development and supply chain costs. For growers, that's about on-orchard yield, fruit size and taste, and focusing strongly on post-harvest efficiencies with post-harvest operators,” he concludes.
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