Fears for losses of up to $500m
Ongoing losses because of fruit quality issues might become a $500 million problem for the kiwifruit industry if a solution is not found, say industry stakeholders.
Zespri chairman Bruce Cameron said in an update to the industry that fruit loss and quality claims were well above historical averages, and he expected it to continue to be a problem in future.
Zespri Sungold Kiwifruit were particularly affected by quality issues, Cameron said. The impact on returns were significant this season, with a predicted loss of $2.80 a tray for Sungold Kiwifruit, Cameron said.
This was against a per-tray loss of $1.68 last season, Cameron said. A tray held 30 fruit.
A June Zespri forecast for 2022/23 put return-per-tray prices at $10.25 to $11.75 for this season.
The August forecast was revised to $10.02 per tray returns.
The June forecast per hectare return of between $141,000 and $161,000 was revised to $138,495 in August.
For green kiwifruit, quality costs were expected to be $1.95 a tray, compared with $1.65 last year, Cameron said.
The June forecast put return-per-tray for Zespri green kiwifruit at $6 to $7.50. The return was revised to $6.13 in the August forecast.
Beyond the impact on grower returns, these quality challenges were putting significant pressure on the company’s reputation for supplying consistent fruit quality.
An industry-wide response was needed to solve the problem, Cameron said.
It was difficult for Zespri to keep fruit that met its standards on shelves this season, Cameron said.
Zespri did not want to provide photos of damage to kiwifruit.
New Zealand Kiwifruit Growers Incorporated (NZKGI) chief executive Colin Bond said issues around labour supply had been increasing over the years, and were likely one of the reasons for quality loss.
Pruning inconsistencies from inexperienced or rushed labour could be responsible for some fruit damage.
However, a number of quality issues could not be attributed to pruning damage. An audit across the entire value chain was needed to see where losses were happening, Bond said.
In a NZKGI podcast interview, Bond said that damage presented as a rash on fruit and as physical damage.
Losses across the industry could amount to between $400m and $500m this year, he said.
The industry needed a robust process in place, from orchard to consumer, to find out why losses were occurring, Bond said.
The forecast said Zespri Ruby Red per hectare return, which was in its first commercial sales year, was influenced by a high proportion of productive hectares returning low yields.
Ruby red vines over two years old yielded more than 6000 trays per hectare. Vines under two years old yielded just over 1200 trays per hectare, the forecast showed.
Zespri’s corporate net profit after tax was expected to be between $227m and $247m.