The outbreak of the bacterial vine disease Psa in New Zealand has cut into the full year profit of kiwifruit marketer Zespri, according to the company’s results for the 2010/11 financial year.
Zespri reported its net profit fell to NZ$7.3m, down from NZ$25.9m a year earlier.
The biggest factor in that drop was the NZ$12.9m spent on the company’s response to the outbreak of Psa last year. Zespri is due to spend another NZ$2.6m this year as part of an overall NZ$50m industry programme to combat the bacterial disease.
Contrasting against the company’s drop in net profit, however, was a rise in grower returns, and an increase in grower loyalty payments from NZ$0.15 to NZ$0.25 per tray, reported the National Business Review.
Average New Zealand kiwifruit farm gate returns rose 7 per cent to NZ$41,830 per ha. Green returns rose 9 per cent, organic green returns fell 5 per cent, and gold returns rose 1 per cent.
Zespri’s global sales stayed relatively static over the year, with sales value rising 1 per cent to NZ$1.51b, and volumes dipping 1 per cent to 106.8m trays, of which 98.1m were from New Zealand orchards.
The company’s chairman John Loughlin said the results were positive considering the state of the global economy, rising costs, seasonal challenges and the outbreak of Psa.
“The increased return to green kiwifruit growers was a highlight because average orchard yields were down by 4 per cent, freight costs due to rising oil prices were up 5 per cent and the New Zealand dollar strengthened through the year,” Mr Loughlin told local media.
“We have a tough 24 to 48 months ahead of us as we learn how to live with and manage Psa. However, I’m confident the industry will overcome Psa and meet its long-term growth plan to triple export earnings from NZ$1b today, to NZ$3b by 2025.”
Asian markets were again a driving force for Zespri’s growth, he added. Demand was generally outstripping supply in the region, which was helping to support pricing across all markets.
