ANZ supports Southland farmers after severe storms
ANZ New Zealand is encouraging farmers and businesses impacted by the recent extreme weather that hit Southland and South Otago last week to seek support if they need it.
That's the overriding theme for the horticulture sector this season, according to ANZ agricultural economist Susan Kilsby.
In ANZ Research's June Agri Focus Kilsby writes that the fruit harvest is in for most growers, and the focus has shifted to exporting.
The harvest of green kiwifruit is ongoing, but for the red and gold fruit it's over, she says.
"This year the kiwifruit harvest, like the apple harvest, was considerably lower than normal.
"In-market prices have improved a little for early season fruit, but it is unclear whether these prices are sustainable."
Looking at grower returns, apple export prices recovered this season, mostly due to lower volumes.
Early season export returns have increased to levels seen a couple of years ago, but reduced yields will limit the sector's total returns, notes Kilsby.
While yields are down, the industry has worked hard to ensure fruit quality.
"Exporters have reported an improvement in the reliability of shipping this season compared to previous seasons, which is not unexpected given the global supply chain challenges associated with the pandemic," says Kilsby.
"Getting space on ships, when and where needed, can be a challenge and tends to be a bigger problem for smaller companies."
She says there is a small window of opportunity this year for apple exporters to benefit from the NZ-UK free trade agreement. The agreement, which came into force on 31 May, allows NZ apples to enter the UK at zero duty from January to July each year, during the off-season for UK apple production.
Apples exported from August to December will be subjected to a quota, which will diminish progressively over three years. Apple production is forecast to be 20-30% down this season, because of the Hawke's Bay floods. Also, production will be impacted for years as some regions have been deemed unsuitable for permanent crops.
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Apple production is forecast to be down 20-30% this season. |
Kilsby says not all growers have the appetite or finances to rebuild businesses, whilst others will opt to keep operating but on a smaller scale.
For kiwifruit growers, the harvest of red and gold kiwifruit is now complete.
Packhouses are currently processing green fruit.
Kilsby noted that by late May about 15% of fruit had been delivered to market.
This year's harvest has been smaller than previous years.
Zespri's now expects to export 136m trays of fruit, which is about 20% less than the 171m exported last year.
She notes that this season, the industry has focussed heavily on quality, to avoid the issues that plagued last season's produce.
Looking ahead to 2024, the kiwifruit harvest is likely to be significantly higher. Kilsby says growers expect next season's gold fruit harvest to be about 50% larger than this season, as existing gold plantings mature and growers switch from green to gold varieties.
