New Zealand’s top-fruit growers could hardly have hoped for better weather for their 2007 crop. “The latter part of the summer and the early autumn have been fantastic,” says Peter Beaven, chief executive of Pipfruit New Zealand, the industry’s representative body. “The Braeburn harvest started in Hawkes Bay two weeks ago and brix is at the highest level in seven years. Royal Gala was the same. The fruit is in excellent condition.”
He admits that a lot of warm nights have been a challenge in terms of colour and in reducing the harvest window. “We’ve managed it so far and the fruit is a really good eat,” says Beaven. “Early spring was warm and then we had one of the coldest Decembers on record, but the temperatures came right in the new year and we have lost no days through rain. It’s been a real Indian summer, with temperatures in Hawkes Bay in late March still in the high 20s.” He emphasises that the warm conditions mean fast-maturing fruit, and that getting it off the trees quickly is vital for fruit going into store. “It is challenging and there have been some issues in Hawkes Bay, but by and large we are on top of it and the markets can expect to see some really good fruit.”
In terms of volume, Pipfruit NZ forecasts that the picture depends on variety. “Cox is down on initial estimates of 388,000 18kg carton equivalents (TCEs) to about 325,000, compared to 350,000 last year, whereas of the other early varieties, Pacific Beauty is up about 200 per cent,” says Beaven. He expects Gala to make up about 38 per cent of the total crop, with six million cases to be exported world-wide, about 400,000 TCEs more than last year, and the early estimates for Braeburn are at around 6.5m TCEs, which would represent an increase of 500,000 on 2006.
Gary Harrison, commercial manager responsible for New Zealand procurement at Worldwide Fruit, the joint venture company set up by exporter Enza with the Northcourt Group in the UK, is expecting one of the lowest ever Cox export seasons from NZ. “It is a difficult variety to grow and the returns have not reflected that in recent years,” he says. “Also real estate prices in New Zealand, particularly the Nelson area where a lot of Cox is grown, are very high. And where there have been new plantings of other varieties, Cox is often the cultivar that growers have taken out. This year we don’t anticipate the Cox crop going beyond May. This will be an interesting year.”
Alex Schenz at exporter Applemax agrees. “The issue with Cox is that this variety is more difficult to grow and obtain quality which should be reflected in prices,” says Schenz. “Unfortunately market returns have been eroded in the past and growers have not been able to re-invest in this variety, so NZ is facing a further decrease in Cox supply of 30 per cent, although Applemax can meet its UK supply commitments.
Generally NZ growers are happy to supply Cox to the UK, however unless the market acknowledges the need for increased returns, NZ may drop below critical mass and fade out as a southern-hemisphere source of supply for this variety. Market partners should be aware of this when agreeing on programmes and final prices for this season.”
Another factor in the Kiwis favour this season is the positive stock situation in Europe, thanks to reduced crop from the continent in general in 2006. But Beaven warns that the early spring across much of the continent and the UK could see early volumes of summer fruit that traditionally compete strongly for consumer spend with southern hemisphere top fruit, making the New Zealanders nervous coupled with the fact that Brazil has more fruit this year and that there is good volume from Argentina, South Africa and Chile.
Happily, communication among the southern-hemisphere sources and between them and their key markets is robust and means that the disastrous accumulation of fruit in Europe that marred the end of the season two years ago should not be repeated this year. “We are in regular touch with each other,” says Beaven. “What happened two years ago was a wake up call. We realised that we have got to communicate more regularly and share information far earlier in the season and on a much more regular basis.” This happens not just through the southern hemisphere exporters’ association Shaffe and the World Apple & Pear Association, but also through personal contacts. “If we want to look after the market, we have got to be in contact,” says Beaven. “We don’t want to leave the market in a mess for the Europeans either. We communicate on a whole range of issues; not just what the crops look like this season, but what we’ve got going in the ground too.”
Harrison warns that with a substantial Braeburn crop this year, the export situation needs to be carefully controlled, “or potentially we could have a situation like we did two years ago. There is still more fruit than there was last year, and exporters have got to be very careful who they send it to. It is more of a continental problem: the UK retail scene is more sensible, but it is a long season until September”.
This season for example, the issue could be to divert more fruit to the US if the EU looks as though it is becoming overburdened. “There are two countries that have an opportunity to do that because of the size profile of their fruit, and that’s Chile and New Zealand,” says Beaven. And that profile is on the large side. “There is a lot of fruit that is quite large, especially Gala,” says Harrison. “There is a definite shortage of the UK size profile, which is probably not too serious because there are other southern hemisphere sources. The very large sizes are preferred by the US and continental Europe.”
Braeburn exports are almost exclusively sent to Europe, as it suits the taste profile of consumers both in the UK and on the continent. “While we have an ongoing dependence on Braeburn as a variety, we will continue trading in Europe in significant volumes,” explains Beaven. “It accounts for 38-39 per cent of our total volume, and while the Far East and the US have always been important to us, Braeburn is really a European apple whereas Gala has a much more worldwide appeal.”
Growers in NZ recognise the need to supply more varieties with greater global appeal. The most significant new plantings are of Enza’s trademarked variety Jazz. Pink Lady, Tentation and high-coloured Fuji sports targeted at the Asian market are also being planted in less significant quantities. And with new releases from Prevar - the international breeding programme in which NZ’s growers have a stake - expected shortly, growers are broadening their portfolio year on year.
“Sweetie has been planted by several NZ growers, but tree numbers are relatively small at not more than 20,000 trees at this time,” says Dr Brett Ennis of Prevar. “It’s a great apple and I’m confident that grower interest will increase as fruit comes on stream in a couple of years time. Plantings of Sweetie are expected in Australia, the EU and North America over the next couple of years. Prevar also has some apple and pear selections that could be very attractive in the UK market as complements to or replacements for Braeburn, Cox and Conference. Some selections could also be grown in the UK subject to satisfactory testing under conditions. Some of these selections will be exported to the UK market in time.”
Beaven warns that it is important not to pre-judge any apples on perceived market preferences. “Pink Lady is going gangbusters in the US and Australia, but it has quite a strong acid balance which you wouldn’t have thought would be popular in those markets,’ he says. Jazz he believes fits the global appeal bill due to its crunch. “Of all apples, it has the highest pressure at harvest - typically 2kg higher than Gala or Braeburn,” explains Beaven. “All the research tells us that consumers buy apples on taste and that is what keeps them coming back. A critical part of that is the crunch, and Jazz meets all those criteria. There is enough Jazz in the ground now to generate 3m cases in the years to come, and it will become a sizeable chunk of the industry.”
Harrison reports that 18,000 TCEs will be coming to the UK market this season as NZ output and UK uptake both double year on year. “The French [growers] have done a good job this season providing continuity and pricing has held up,” says Harrison. “It is THE premium apple alongside Pink Lady. One of the things about Jazz is that every market likes it, even southern Europe, the Far East and the west and east coasts of the US.”
Worldwide Fruit is ramping up its consumer campaign again this year, with the Yes Consultancy running retailer promotions alongside the PR effort in June and July.
As a high-wage economy a long way from its major markets, New Zealand needs to be at the premium end of the market, a fact that constantly drives its innovators. “We are working on a programme to bring to market the safe products that consumers want to see,” says Beaven. “Greenpeace and other organisations want all markets to agree on safe residue levels, but we are not in agreement. The solution is for us to have production systems that can produce fruit with residue levels so low that they are not a barrier to trade. We have the science and innovation framework and we are confident we can get there very soon.”
Another issue that the environmental lobby has raised is that of food miles, and here there is a lot of misinformation, the NZ industry believes. “New Zealand has been singled out for attack and the argument is not sustainable or logical,” says Beaven. “The whole debate is fuelled by gullible reporters and local producers. The only way to look at this is by considering the carbon footprint, looking at the whole production process, what it costs to produce as well as to get to market. I hope that in the next two to three years consumers will become better educated and that the grounds of the debate will change from food miles to sustainability, which is where the debate should have started in the first place.”
And Schenz has a stark warning for the markets. “The industry - and not just within the UK -needs to rethink whether they continue to require quality fruit on retail shelves and try to achieve this with European apples which have been stored for more than six months, or whether they will promote fresh supply from the southern hemisphere honestly,” says Schenz. “It would be counter-productive and would hinder sales to stigmatise this fruit with a food-mile label.”
Harrison does not believe that the average UK consumer is even aware of where most of their fruit comes from. “New Zealand has proved as an industry that it is very efficient and a study is about to come out that will demonstrate that,” says Harrison. “Yes, it is a long way from its markets, but it has a good reputation and its image is very good. Does the UK consumer really know the apples he’s buying come from New Zealand? I think that would involve a generic campaign and I am not sure how effective that would be. It is difficult enough returning good money to growers, so I think we’re better off spending on promotions with individual retailers and increasing grower returns that way.”
Schenz is particularly concerned that this season a strong NZ dollar will once again reduce grower returns and Harrison agrees. “Currency is an understated factor in grower returns,” he says. “It can make the difference between earning or losing money in a season.” Let’s hope this season brings the former rather than the latter.
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