Pipfruit expansion continues
Pipfruit plantings continue at pace as recent years of strong returns has buoyed the industry.
Agfirst consultant Ross Wilson says Hawke’s Bay has numerous new greenfield sites being planted this year. “This is the most
significant period of development I have ever seen,” he says.
The exact amount of new plantings is difficult to ascertain as many growers don’t register new sites until they come into production, in the second or third year after planting.
New Zealand Apples and Pears statistics show a modest increase of 300 hectares planted over the winter of 2017 to a total in excess of 9,800 hectares nationally, but the actual figure is likely to be considerably higher than this.
While growth in plantings in recent years has been significant, the planted area is still well short of the peak reached before deregulation of the New Zealand Apple and Pear Marketing Board. Prior to 2001, the planted area exceeded 15,000 hectares.
Diversity of planting continues at pace as growers align with club varieties offering a smorgasbord of choice. T&G’s Envy apple leads the charge, but other club varieties such as Honeycrisp, Koru, Rockit and Ambrosia feature among the
Week 41, 337,000 tonnes of pipfruit has been exported, or 86 per cent of the forecasted volume.”
New Zealand Apples and Pears chief executive Alan Pollard
most favourite choices, with Dazzle expected to feature in future plantings.
High coloured strains of Royal Gala, Pink Lady and Fuji are also being widely planted.
Exporters continue to put a great emphasis on developing their own proprietary varieties to give them a market edge. Scales Corporation managing director Andy Borland says development of Diva and Dazzle is going well, with further new varieties still in the pipeline. An early season pink to bright red apple with a sweet honey flavour, and a highly productive, large, full-red apple that also matures early in the season are being developed.
A growth target of 3.5-million TCEs by 2020 was set by the company, but this was reached four years ahead of schedule and has now been increased to 4-million cartons. With the addition of Longview and Fern Ridge, Scales’ Horticulture division is expected to handle more than 25% of New Zealand’s total apple crop.
A very promising start to the pipfruit marketing season in 2017 fell short as rain affected fruit quality in later varieties and growers’ ability to get the fruit picked. With still the tail end of the harvest to be exported, it is becoming clear the crop will be smaller than 2016.
New Zealand Apples and Pears chief executive Alan Pollard says by Week 41, 337,000 tonnes of pipfruit has been exported, or 86 per cent of the forecasted volume. This is four per cent down on last year, where a total of 352,000 tonnes was exported.
Ross Wilson says rainfall during the autumn harvest was more than double its normal level. Cyclone Cook was disruptive, carving a swathe through the region at Easter time. Whole rows of heavily laden Pink Lady trees were knocked over during the height of the storm.
Further warm cyclonic weather continued to make for a difficult harvest through into May. “Harvest conditions were made very difficult, colour development was poor, and ground conditions were appalling. High winds brought by the cyclone meant a portion of the crop fell to the ground.
Secondary bruising and fruit handling issues resulted in further losses. Varieties most affected were Pacific Rose and Queen, Pink Lady and Fuji.
Andy Borland says the extremely wet conditions in the latter part of the 2017 harvest season resulted in a poorer than expected recovery. Royal Gala was mostly harvested before the deluge, and reached targeted volumes and prices.
Wet conditions carried right through the winter, and industry commentators were warning growers to approach thinning sprays with care, as water logged soils had the potential to lead to heavy fruit drop.
Ross is buoyant about the prospects for the 2018 season. In the main, growers have avoided over-thinning and warm spring conditions with plenty of sunshine days have meant a good for young fruitlets.
The season is running 10 – 14 days earlier than last year, and he expects that to carry through to earlier harvest dates. From his client base, he believes returns are back by $1 to $2 on the 2016 season, which was outstanding in all respects. “This still represents a good level of profitability for growers,” he says.
Marketing conditions for Braeburn in particular have been tough, with prices per carton dropping to $19 in some cases. Further reductions in planted area of this variety can be expected. Other late season varieties Fuji, Pacific Queen and Rose have also been price checked with quality issues contributing to a difficult marketing season.
T&G GM Pipfruit NZ Bruce Beaton says T&G is working hard to maintain capacity for growth in throughput, especially for their new flagship variety Envy. Market conditions for Pacific Queen had been tough this year, and work would be undertaken to spread market acceptance to a broader
“We were compromised by the quality of fruit this year which affected our ability to maintain volumes into China,” he says. T&G has plans to review its entire infrastructure. Investment continues into the whole supply chain from tree to market.
The Envy selling season will be completed in November, when sales are handed over to US suppliers of the fruit.
Alan Pollard says challenges lie ahead, particularly in relation to market access. Southern Hemisphere apple production continues to grow. Trickle down effect can be expected from Trump’s “America First” campaign, and across the Atlantic Brexit will also lead to changes. Trump’s attitude toward the North American Free Trade Agreement (between Mexico, US and Canada) offers a threat and opportunity for New Zealand growers. If trade between the US and Mexico slows, it could offer a positive spin off here.
With Britain pulling out of the EU, New Zealand will need to negotiate a free trade agreement with Europe.
“We face a lot of regulatory hurdles, there are increasing non-tariff barriers coming out of Asia. We have been working hard in this space, working with these countries finding common ground.”
Uncertainty around North Korea, and trade issues between the US and China also propose a threat to exporting from New Zealand. “We don’t want to be collateral damage,” he says.
The new Government’s attitude toward the Trade Pacific Partnership (TPP) would also be watched with interest. “It is not easy to renegotiate these things, as a trading nation this could offer us real benefits, especially trading with Japan.”
“We will be looking for a very clear trade agenda from our new Government. There is uncertainty around this area.” The industry needed to remain focused on not just achieving great production, but also selling a commercially viable product on international markets.
As the crop increases, the demand for labour will also increase. Unemployment levels are low, and pipfruit employers have worked very hard on creating pathways for New Zealand workers into the industry.
“We are dependent on the RSE programme to harvest the crop; we can’t survive without the scheme. We have 10,500 RSEs coming; pipfruit, kiwifruit and grapes are all growing exponentially, all of us are reliable on a credible
reliable labour source.
“We continue to grow the industry, volume and profitability
with as little state intervention as we can. The effect of the new Government’s regional economic portfolio will be interesting,” he says.
The new Government will be reducing the numbers of immigrants which could have fallout for the industry.
Alan is leading the charge toward achieving an export goal of $1-billion dollars by 2022. After the 2016 season, the industry was bullish about achieving this ahead of target. “We still think we will make the target ahead of schedule, by 2020,” he says.
T&G FOODS FOR SALE
T&G has notified its intention to sell its juice processing plant, T&G Foods, in Hastings. The juicing plant was first built by the New Zealand Apple and Pear Board in 1962 to provide an avenue for process fruit. In an earlier announcement, T&G chief executive Alastair Hulbert said they are looking for an owner focused on fruit processing who is willing to invest for the long term. Reasons for the sale included a reduction in volume of fruit to process, and declining worldwide prices for apple juice concentrate.
T&G Foods has the capacity to process up to 200,000 metric tonnes of apples and other fruit at its two manufacturing sites, one in each of Hastings and Nelson. The business processes apples into apple juice and has also diversified into the production of higher margin fruit ingredient products including diced apple for the food services industry, apple sauce in bulk and small format pouches for retail consumers.
Sunfruit Orchards will be commissioning an innovative new packing facility in Hastings for the 2018 packing season capable of processing up to 100,000 bins.
Commissioning is expected to take place by a February 1 start date, and in the first season will be set up to process 50,000 bins of fruit.
Company principals Tim and father John Altham have adopted a new approach, with a Dutch packing system installed by Greefa. To meet their needs for local market and export packing, the new packing line will adopt a European concept of “just-in-time” packing.
Tim says the key concept is to have fruit in the carton for as little time as possible. “We aim for a general turnaround for a packed carton of a maximum of 10 days before it reaches a container; we want to take re-packing out of the equation,” he says.
The pair have spent three years looking at packing systems in the US, Italy, Holland, France and Australia before opting for the Greefa system. John particularly liked the fruit-handling attributes; fruit is moved in water, and the number of brushes is minimised; fruit is let down gently where height changes are needed.
Fruit begins its journey at the apple dump, travels through the high-pressure apple washer, then pre-sorted fruit is coolstored until it runs through the packing tables. Unlike a traditional packing shed where multiple sizes are sorted and packed into cartons, bins will be of just one pack size to streamline the operation. This feature guarantees fruit will remain in cartons for only a short time prior to being shipped for sale.
The system is designed to run at an even speed, to ensure efficient operation. “We expect a higher skill level from staff, it will be more about computer operation,” John says. Automatic packers have not been installed on the packing line, but provision has been made to install these as technology and processing speed of automated packers improves.
Coolstores will be added to the greenfield site in Irongate Rd, south of Hastings.
Sunfruit, through its marketing brand Pickmee, supplies 30 per cent of its packed apples to New Zealand supermarkets, and 70 per cent is exported. Sunfruit runs 450 hectares of orchards in Hawke’s Bay, and 100 hectares in the Waikato.
Tim is a third generation fruitgrower, his grandfather began orcharding in the Waikato in 1933. Their original Waikato packhouse at Rukahia in the Waikato will continue to pack 15,000 bins. It will be upgraded to a Greefa packing system in the future.
John, who was a New Zealand Apple and Pear Marketing Board director for nine years, sees the pipfruit market has come a long way since deregulation in 2001. It has moved from 98 exporters selling Royal Gala and Braeburn, to a far more diverse industry with 20 or so main players and some smaller participants.
Asian markets are far more diverse, and the industry has matured a great deal over the last decade. Sunfruit focus on their own suite of varieties – Kiku, a high colour Fuji, Pink Lady, Galaxy and Pacific Queen are important varieties to the business.
This year in particular has demonstrated a different marketing pattern for the industry. In Week 42 this year, 21,000 tonnes of apples have been exported. In 2016, this figure was just