Revamped Fonterra to be ‘more capital-efficient’
Fonterra chair Peter McBride says the divestment of Mainland Group is their last significant asset sale and signals the end of structural changes.
Total sales for the season were up 21% on the previous season to $1.9 billion, resulting in a return per hectare of a record $60,758. Zespri sold 131.6 million trays, 117m grown in NZ – nearly 22m more trays than in the previous season.
McBride says SunGold's performance in the market was very positive, resulting in an average payout to growers of $8.21. And there was a record crop per hectare of green kiwifruit, though this caused a slight drop in the per tray price to orchardists.
Overall, McBride says, the result is positive, stemming from a combination of market development and market improvement.
"But we still require some on-orchard improvement to the taste of green kiwifruit and we need to review the programme and payments again this year," McBride told Rural News. "There is a slight misalignment in what is being produced and what the market wants."
Several factors are seen as the cause: one is that big yields of green kiwifruit cause the taste to go down a bit; another factor is location -- the regions and even orchards within regions.
"Part of it is just attention to detail such as thinning and pruning regimes, canopy management and artificial pollination. There are many factors."
A challenge caused by the industry's expansion is the need for more infrastructure -- more coolstores at ports, more transport and more reliable workers.
With more kiwifruit coming in the next few years, McBride says the industry, like the apple and wine industries, have come to rely heavily reliant on the Recognised Seasonal Employer (RSE) scheme under which workers from overseas – in particular the Pacific islands – harvest and package the crop. The industry could not grow without these workers.
"We also work with WINZ to help NZ folk find employment in our industry, but this is challenging because so many of the people we get are unreliable. One orchard I manage employed 72 people through WINZ, but only three made it," he says. "A lot of plant and fuel got stolen. We tried really hard but... these people don't really want to work."
