Banks need to back growers

Many orchards growing the gold variety Hort16 which have been devastated by Psa are likely to be grafting a replacement variety this winter – with their first crop from those vines in 2014.

“It won’t make sense for banks to foreclose at this time because the sales of that orchard will be quite low. If banks are prepared to support them for a year or 18 months, the likelihood is the growers will able to recover all the equity.”

Trebilco, who is president of New Zealand Kiwifruit Growers Inc (NZKGI), made the comments as kiwifruit growers engage in a consultation period, with meetings around the country, on a three-year Psa recovery plan released by Zespri. It proposes a broad-scale release of a new gold variety, Gold3, over the next three years.

Zespri is offering growers two options for the release of G3.

The first is a commercial proposal where Hort16A growers will be paid $5000/ha to return their existing Hort16A licence.  The grower can then choose to join a commercial (closed) tender process, whereby the highest bids are successful.

The second option would offer all Hort16A growers a licence if/when they deem the timing to be right to re-graft based on their personal circumstances. 

Under this option, Hort16A growers can make a fixed price bid (proposed to be $12,000/ha) for enough Gold3 licence to replace their existing Hort16A plantings.

Under both options a further 400ha of Gold3 are being released to give non-Hort16A orchards an opportunity to buy Gold3 licences and diversify their growing portfolio.

Also, under both options, a deferred payment of 80% of the cost is being offered. Growers can repay the money when their orchards begin to produce again.

In addition, ZESPRI is proposing to release up to 200ha of Green14, a newly commercialised (in 2010) sweet green variety, through a $3000 fixed price allocation.

Trebilco says there’s been a lot of grower uncertainly about what the release mechanism might be for the new G3 variety that’s “caused a lot of discussion”.

He says the “pathway to recovery” consultation “may settle some of that discussion” and options may be modified after grower discussion.