A New Zealand government report has found the country's apple industry had a slight improvement in profitability this year despite variable production and sizing.

The Ministry for Primary Industries (MPI) attributed the profitability rise to an increase in prices, particularly in Europe, which helped compensate for the high value of the New Zealand dollar.

The report was based on information gathered from a sample of growers and industry stakeholders, providing an overview of the financial performance of typical orchards with models of Hawke's Bay and Nelson farms.

MPI said a cool spring delayed flowering and harvest by around two weeks this season. Hawke’s Bay also had below-average temperatures and lack of sunny weather over summer.

Overall, production and sizing achieved was more variable than usual, with Royal Gala in particular significantly smaller. On the other hand, fruit colour and quality were generally excellent.

The harvest delay led to a shorter window for early sales in Asia before competition with other Southern Hemisphere suppliers, while the European market was more balanced.

"Growers are particularly welcoming the expected lift in the return for Jazz TM this year. It’s looking like they will receive an average of NZ$22 (US$17.95) a carton after getting NZ$19 (US$15.50) last year," said MPI senior policy analyst Annette Carey.

The report highlighted lower returns in recent years were driving industry change, with vertically integrated businesses demonstrating an advantage over grower suppliers.

MPI said growers were optimistic about the potential for market expansion in Asia in the medium term, with outcomes from research and development programmes helping to meet pest, disease and residue requirements.

Click here for the full report.

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