NZ: Zespri grower returns rose in 2017-18 despite kiwifruit volume drop

More News Top Stories
NZ: Zespri grower returns rose in 2017-18 despite kiwifruit volume drop

New Zealand kiwifruit marketer Zespri has said that a strong kiwifruit market performance during the 2017-18 season led to higher returns to growers despite an overall drop in sales volume.

The organization said that volume sold fell by 11% but total fruit and service payment to growers increased by 6% to NZ$1.47 billion (US$1 billion).

Zespri’s global kiwifruit sales for the year were also up 6%, at NZ$2.39 billion, while total revenue including license income was NZ$2.51 billion.

Chairman Peter McBride said the uplift in value reflects strong consumer demand and excellent market performance.

“We sold a record volume of SunGold while growing returns at both per-tray and per-hectare levels," he said.

"Supply of Green and Organic Green reduced considerably from the exceptionally high volume of the previous year, but very strong consumer demand more than offset the impact on per-hectare returns for Green and mitigated the impact on Organic Green per-hectare returns."

Zespri’s net profit after tax in 2017-18 increased by 38% to NZ$101.8 million, primarily driven by revenues from the release of 400 hectares of SunGold license in 2017.

Sales volumes through the non-New Zealand supply segment fell by 8%, with green supply in Italy reduced because of frost damage. 

However, SunGold sales in Italy increased to offset the fall, with the Zespri Global Supply business recording total sales revenue of NZ$264 million, up from NZ$217 million the previous year.

McBride says that Zespri delivered a good sales result for green, with the average per-tray return increasing to NZ$6.71 from NZ$4.36. 

“This was supported by good quality and low rates of onshore fruit loss. The average per-hectare return for Green across the industry was $59,981, a new record for the category, and the result was achieved in spite of a 27 percent decline in average yields," he said.

Meanwhile, gold sales volume rose by 9% to 52.1 million trays and the average return per hectare across was up 16% at NZ$114,345. The average per-tray return was NZ$10.06, up from NZ$8.64.

Zespri CEO Dan Mathieson summed up that the 2017-18 season "represents good progress and outstanding work by the Zespri team."

"We are now looking forward to growth in volume. We are anticipating record production of New Zealand and non-New Zealand kiwifruit this year driven by increasing supply of SunGold and a recovery in supply of Green," he said.

“Our challenge is to continue to lift our performance by staying focused on improving the execution of our brand-led, consumer-focused strategy, supported by excellence in marketing and strong, connected partnerships with growers, suppliers, distributors and retail partners.”

Subscribe to our newsletter