A strong New Zealand dollar could present challenges for the country’s kiwifruit sector in core international markets this season, according to Zespri's chief operating officer, Simon Limmer.
The kiwi dollar hit €0.66 last week, a two year high, while the currency is also performing strongly against the Japanese yen.
“Japan has been our cornerstone market for decades, representing about 15 to 20 per cent of sales by volume, but about double that in terms of value,” Limmer told the New Zealand Herald. “We've got hedging in place for the yen for the next year or two, but obviously the worsening position of the yen to the New Zealand dollar is not helping, so that is of concern to us. Similarly we have not seen a lot of upside in the euro and still take a relatively conservative view as to where that might lead.”
The exchange rates appear to have partially been offset by the fall of the New Zealand dollar against that of the US. Alarm bells were sounded in early 2014 when the New Zealand/US rate hit US$0.88. However, with prices easing back to around US$0.78 last week, Limmer said the outlook was more promising for the upcoming season.
“There is some benefit in the US dollar over the last couple of months, which has started to flow through into our thinking over the next few years,” he explained to the New Zealand Herald.
