Apple scarcity lends bite to NZ exports

PETER WATSON
Last updated 12:16 19/02/2013

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A global shortage of apples should keep prices firm this season, helping offset the impact of higher exchange rates, says Pipfruit New Zealand.

Services manager Gary Jones said New Zealand growers - many of whom have been under pressure from low returns in recent seasons - were well placed to capitalise after lower crops harvested by most of their main competitors.

Because of mainly adverse weather, but also some restructuring, production was down 14 per cent in the United States, 8 per cent in Europe and 8 per cent in Chile, he said.

Apart from the US, apple stocks were also significantly lower, with main varieties royal gala and braeburn down 20 per cent and 25 per cent respectively in Europe.

"We expect there will be a reasonable degree of scarcity, so there is some optimism that we will be able to compensate for exchange rates and get out of jail again.

"There should be strong demand for our product. It's a matter of making sure it's appropriate for the market, getting it there, and being patient with the price."

Exporters were already receiving good levels of inquiry from Asia, Europe and the US and had the benefit of a long selling window which went through to October, Mr Jones said.

"There is a lot of water to flow under the bridge but everyone is optimistic."

It helped that growing conditions had been much better than last year when a cold spring and summer led to a crop with a lot of smaller fruit which don't typically fetch as high a price.

This year fruit size was back to a more normal range, and colour and quality were excellent. The dry conditions had also meant there had been less disease and pest pressure, he said. "It's looking like a very nice crop."

Pipfruit NZ is forecasting an export crop of 16.9 million cartons. This is 5.7 per cent higher than the 16 million cartons packed last year and one of the biggest crops in recent years.

Hawke's Bay is expected to supply 10.4 million cartons - 61 per cent of the export crop - with volumes up 3 per cent after frost and hail damage in the area.

While Nelson copped some hail and wind damage, production is set to grow 11 per cent to 5.2 million cartons (31 per cent of the export crop). The bulk of this would be braeburn (1.35 million cartons), royal gala (1.3 million) and jazz (just over 1 million).

Mr Jones said the increases were because of increased plantings of new varieties, such as envy, rocket, honey crisp, smitten and pacific queen, coming into production. It was part of the industry's move to reduce its traditional reliance on braeburn and to focus on varieties with more appeal, particularly in the growing Asian markets. The braeburn crop was expected to be 3.4 million cartons this year, the lowest on record and down on the 3.6 million exported last season.

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The area planted in other mainstay varieties royal gala and fuji was static, but old blocks were being removed and replaced with new high-colour strains, he said.

The trend for more fruit to go to Asian and Middle Eastern markets was set to continue, although their rapid growth might slow this year if US and European buyers sought more fruit and started paying fixed prices.

"When there is a scarcity of apples it is all about who will pay."

Asia and the Middle East took 40 per cent of the export crop last year, up from 33 per cent in 2011, whereas Europe's share dropped to 25 per cent, he said. The US and Britain took about 15 per cent each.

- © Fairfax NZ News

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