Drastic cuts expected for NZ Braeburn apples
Palmer told www.freshfruitportal.com the Braeburn challenge is nothing new but the speed of decline is set to pick up.
"I know there’s been 500 hectares of Braeburn razed in the last five years and I wouldn’t be surprised if another 500 were to go in the next two years," he says.
"It’s still a very good apple and the Northern Hemisphere will still have some shipments, but that has high shipping costs. For our traditional markets, the most challenging thing is the exchange rates.
"We’re having to look closer to the Asian varieties, and Braeburn doesn’t fit the Asian profile apple. Changing is about dynamics, and growers will always look for ways to survive."
He says New Zealand has faced the challenge by investing in sweeter Asian profile apples over the last six or seven years.
"The crops themselves have been going fairly well but we’re challenged in terms of grower returns due to the high exchange rates, and those investments made haven’t reached their true value yet," he says.
"Fuji and Royal Gala are the main ones which have a sweeter profile and there are some New Zealand varieties out there - there's Enza’s Envy variety which is another that fits the Asian variety profile.
"We’re seeing a market shift in where we focus. The European markets are not going away but we’re seeing a shift, and that’s why we’re doing this - we’re looking at the entire Asian continent."
Palmer expects access to the Australian market later this year, while ruling out the possibility of exporting to South America where currency levels are also high.
"We expect access to Australia later this year. (Volumes) It's completely unknown unfortunately, we'll start to supply and I get a feeling it will be significant, but it’s hard to quantify," he says.
"The key about a market like Australia for us is that it’s used to being defensive, and all those discussions have gone on for years that have hoodwinked people about foreign apples.
"South America is not an area we’ve traditionally looked to supply. Naturally South America has it’s own supply, and economically it would be difficult to go there."
South African G.F. Marketing director David Pearce has revealed further signs of NZ's apple industry difficulties to www.freshfruitportal.com, with New Zealand selling apples in the Middle East at much lower prices than competitors.
"We understand that NZ have a large crop and this can be the only reason why they started off at much lower pricing than what the market was selling at," he says.
"New Zealand is not always in the Middle Eastern market and it seems that this year, they are using it to dump stocks."