Tuesday, 08 October 2024 07:25

Big future for hort

Written by  Sudesh Kissun
Kiwifruit exports for the year ending August 2024 were worth around $3.1bn. Kiwifruit exports for the year ending August 2024 were worth around $3.1bn.

The horticulture sector is punching above its weight when it comes to export revenue, according to Westpac industry analyst Paul Clark.

And Clark expects the sector to continue to grow as more global consumers demand high quality nutritious fruit that delivers health benefits.

In the bank's NZ Agri Bites report for September, Clark says horticulture exports are already a big deal.

“Kiwifruit and apples are our fourth largest export category, after logs. Add wine into the mix, and the sector catapults into third place,” says Clark.

“The sector punches way above its weight. Not only is it one of the most efficient producers of fruit internationally, but it also outperforms other sectors of the New Zealand economy.

“That is particularly true for kiwifruit, which leaves even the high-performing agricultural sector in its wake. Much of that has to do with ideal growing conditions in New Zealand. Being a counter-seasonal producer also helps.”

The sector also spends large on R&D which not only delivers the process efficiencies but also products tailored to customer preferences.


Read More


Clark says high export revenues have also got to do with increasing demand for high quality fruit, especially that which delivers unrivalled health benefits.

“Population growth and rising incomes in key export markets should ensure that this remains the case,” he says.

However, he cautions that in the years ahead, supply is likely to be a key factor that determines prices. Careful management here will be needed to deliver superior orchard gate returns.

Kiwifruit exports for the year ending August 2024 were worth around $3.1b, while apples contributed slightly under $1b.

Clark says that makes the sector the fourth largest exporter in New Zealand, just behind logs. “Add $2b worth of wine into the mix, and the sector catapults into third place.

“The sector punches above its weight. Not only does it post higher production yields than many of its contemporaries, the sector also shows an unrivalled export propensity – a nod to the quality of fruit produced in New Zealand and its ability to compete successfully in export markets.”

According to Clark, much of that success reflects ideal growing conditions in regional New Zealand. Being a counter-seasonal producer, it is well placed to fill gaps in global supply.

He notes that the sector is also a big investor in R&D, which has delivered both process efficiency gains as well as new products that align to changing customer preferences.

Clark says he thinks that this is a growth sector. Demand for high-quality, nutritious fruit that delivers health benefits is set to grow over coming years.

“Subject to the weather and the impacts of climate change, supply will be all important in determining prices. Careful management here will help support prices and deliver superior orchard gate returns in coming years.”

The 2024 kiwifruit and apple crops look promising. The 2024 kiwifruit crop of just over 190m trays is larger than the 133m trays exported in 2023. About 75% of this season’s crop has been shipped offshore, notably to the EU, China, Japan, which account for over 70% of kiwifruit exports.

Clark notes that export demand for kiwifruit is set to remain strong. However, we still expect prices to dip as supply from New Zealand and other major exporting countries lifts. Competition from seasonal summer fruits could also dampen prices.

But volume effects should outweigh price effects, meaning better orchard gate returns on a per hectare basis.

Apple growers should also benefit from gains in production.

Clark says good growing conditions have resulted in a better 2024 harvest. But with production still off from previous years, this latest harvest reflects a partial recovery from Cyclone Gabrielle.

Clark notes that New Zealand’s production is counter-seasonal, which means that demand for its apples in key export markets is likely to remain strong over the coming year.

“Prices though should still tilt lower as growing capacity recovers further and output levels grow. We think that is likely to translate into better orchard gate returns for apple growers,” he says.

More like this

Export prices set to remain elevated

Horticultural prices are set to remain elevated this year, reflecting the balance between demand in key export markets and an increase in supply.

Feds, banks lock horns

Major rural lenders are welcoming a call by farmers for the Commerce Commission to investigate their net-zero emissions target.

Featured

Australia develops first local mRNA FMD vaccine

Foot and Mouth Disease outbreaks could have a detrimental impact on any country's rural sector, as seen in the United Kingdom's 2000 outbreak that saw the compulsory slaughter of over six million animals.

NZ household food waste falls again

Kiwis are wasting less of their food than they were two years ago, and this has been enough to push New Zealand’s total household food waste bill lower, the 2025 Rabobank KiwiHarvest Food Waste survey has found.

Editorial: No joking matter

OPINION: Sir Lockwood Smith has clearly and succinctly defined what academic freedom is all about, the boundaries around it and the responsibility that goes with this privilege.

National

Machinery & Products

Yamaha acquires Robotics Plus

New Zealand based company Robotics Plus, a specialist in agricultural automation, has announced an agreement for it to be acquired…

Ecorobotix announces NZ dealership

Swiss-based Ecorobotix has announced its entry into the New Zealand market through a strategic partnership with Canterbury-based New Zealand Tractors.

Sorting unwashed potatoes made easy

Downs, a leader in potato reception, automated sorting, and storage, has introduced its new high-throughput optical sorter for unwashed potatoes…

Jumbo X saves time and money

A winner of a prestigious ‘Technical Innovations 2024’ award by FederUnacoma at the EIMA show in Italy, the Maschio Jumbo…

» Latest Print Issues Online

The Hound

A step too far

OPINION: For years, the ironically named Dr Mike Joy has used his position at Victoria University to wage an activist-style…

Save us from SAFE

OPINION: A mate of yours truly has had an absolute gutsful of the activist group SAFE.

» eNewsletter

Subscribe to our weekly newsletter