Kiwifruit growers facing record pre-hectare returns: Zespri   17 Dec 2014

Zespri says kiwifruit growers facing record pre-hectare returns

By Fiona Rotherham

Dec. 17 (BusinessDesk) - Zespri International, the grower-owned kiwifruit marketing company, said it expects record per-hectare returns for green and green organic kiwifruit this season following supply constraints, favourable market conditions and strong end-of-season sales.

Pre-hectare returns for green kiwifruit growers are forecast at $52,987 and green organic at $42,207. The increased grower returns are across all categories and Zespri chief executive Lain Jager said the overall result reflected some one-off factors.

“A shortage of supply of green kiwifruit from Chile and constrained supply of gold kiwifruit from New Zealand have supported pricing, while Zespri’s foreign exchange hedging policy has mitigated against the strong value of the New Zealand dollar,” Jager said in a statement.

In the latest December forecast, green orchard gate return (OGR) per tray has increased 20 cents to $5.91, the highest level since 2003. That compares with the $5.71 forecast in October and $5.23 in the 2013/14 season. The increase follows lower fruit loss in Europe and Japan and fewer quality claims in Europe and east Asia.

Zespri estimates a combination of strong sales and pricing and an early finish to the season which saw less promotional spending has added around 60 cents to the final green OGR.

The forecast organic green OGR is up 28 cents to $7.09 while the forecast gold OGR is up 15 cents to $9.72, supported by higher average pricing in east Asia.

Jager said although the industry still faces challenges as it continues to recover from the 2010 Psa bacterium outbreak, it has much to be positive about.

The latest MPI outlook for primary exports said horticultural exports were forecast to be up 4.2 percent to $156 million for the 2014/15 year, driven largely by a 16 percent rise in kiwifruit exports.

(BusinessDesk)

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