Growers warned of lower returns

Rapidly increasing gold kiwifruit volumes will mean falling per tray return for growers, warns Zespri CEO Lain Jager.

Lain told growers at yesterday's Zespri AGM at Baycourt that low volumes were driving average gold returns to a record $12.91 a tray.


Zespri Ceo Lain Jager (left) warned growers to expect lower per tray returns as gold volumes increase.


Zespri's board took centre stage at yesterday's AGM at Baycourt.

As gold volumes rapidly increase over the next few seasons, grower returns will drop to 'more normal levels”. However, that drop should be offset by more fruit per hectare.

'If we deliver high taste (in gold fruit) we should see high-yield as a tremendous competitive market opportunity for us, rather than a problem.”

No new licences to grow gold kiwifruit are likely to be issued next year, he says.

'Until we understand the yield potential of Gold 3 more fully, it would not be prudent for Zespri to issue more gold licence. This makes further allocation of licence for 2015 unlikely,” Lain says.

The future of the second new gold variety G9 may be in doubt because it 'shrivels”, which is causing a loss of confidence among customers.

'Ultimately we may need to consider whether this variety remains viable.”

Lain says early adapters who graft to a new variety are taking a higher risk as the future of a new fruit is not necessarily assured.

'Our strategy must be built from the market back through the rest of the supply chain. This means success is likely to be reflected by having relatively few, relatively large product categories, which each earn their own shelf space.

'In this environment we must avoid the temptation to allow the proliferation of small products in the market and have the courage to de-commercialise cultivars that do not have a clear role in the portfolio.”

After the meeting Lain told SunLive the kiwifruit industry may be moving towards a situation similar to that apple industry, which could see new varieties being grafted on a much more frequent basis.

Zespri innovation manager Bryan Parkes says more than 100,000 new varieties are currently under Plant & Food and Zespri trials - 264 are part of colonial trials and are at least five years away from commercial trial. Two varieties are in commercial trials and one is a red variety.

'We have the largest programme (on new kiwifruit varieties) in the world.” No new variety will be released until it has met a range of strict criteria, he says.

Lain also warns that if the New Zealand dollar continues at current high levels, growers will eventually be fully exposed to the strength of the Kiwi.

'Zespri is currently adopting a conservative position with respect to taking foreign exchange cover as we do not want to lock in unfavourable rates and be left exposed to significant currency losses when the dollar eventually falls.”

In a relatively quiet meeting, with no contentious issued raised during general business, growers re-elected the board's youngest member Nathan Flowerday for a further three year term and elected DMS director Paul Jones to take the vacancy left by Craig Greenlees, also of DMS, who retired after 15 years with the board. David Pilkington, whose existing position on the board was uncontested, was also re-appointed.

You may also like....

0 comments

Leave a Comment


You must be logged in to make a comment.