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Alan Pollard - Pipfruit New Zealand

Big shift in New Zealand's apple export markets

New Zealand is looking at producing a record apple harvest this season. "We have had good growing conditions so far," said Pipfruit New Zealand's CEO, Alan Pollard.

"Last year Nelson experienced some significant hail events which caused quite a bit of damage. But it is so far, so good this year. There has been some hail but nothing like the level of last year, and all regions will experience some growth in production. Warm days and cool nights point to a good season ahead with great quality fruit and the largest crop we have ever grown."

Crop estimates just completed show the 2017 forecast of 584,000 tonnes will eclipse the previous record of 560,000 tonnes held since 2004.

The 2017 crop, produced from 9,500 hectares, shows huge productivity gains compared to the previous record season in 2004, grown on 13,500 hectares.

"We are using different growing methods, and planting new varieties such as Envy which give higher yield; this together with the extra plantings is helping to fuel this growth."

In 2012, New Zealand Apples and Pears set a goal of becoming a billion dollar export sector by 2022.

It is the first of the larger primary sectors to achieve the Government’s export double goal, increasing from $341m in exports in 2012 to approximately $720m last year.

The industry expects to achieve its billion-dollar export target much earlier than forecast, and is already looking towards setting a $2 billion goal.

Changing markets
With harvest now in full swing and fruit starting to arrive on New Zealand’s supermarket shelves, reports of big shortages have been exaggerated, according to Alan. "Apples are seasonal and it is not until late January that some early varieties start to become available. It has created more interest in the new season apples, with people anticipating their arrival on the shelves."

Apple exports from New Zealand have seen a big shift from west to east in recent years. Last year around 41% of total NZ apple exports went to Asia, while 12 years ago in 2004 only 13% went there. It won't be long before it approaches 50-50. "We have some exclusive varieties which are very popular and can command premium prices. New Zealand Queen for example has a very strong presence in the Chinese market and we have produced quite a few very good, big red sweet varieties which are popular across Asia, explains Alan.

But Alan points out that New Zealand has not forgotten their traditional markets. Germany is still the biggest market for NZ apples, followed by the US then the UK, but Taiwan is now the fourth biggest market having seen huge growth in recent years. "In 2013 the government entered into an economic cooperation agreement with Taiwan. At that time we had a 20% tariff which, under the agreement, was removed overnight. Our volumes have gone from 8,000 tonnes in 2013 to 34,000 tonnes last year."

The Russian ban and increasing storage capabilities of European growers
Poland exported around 750,000 tonnes of apples to Russia before the ban came into place a couple of years ago. This volume, as well as that of other European producers, was suddenly left looking for new markets. European growers are also developing storage techniques. How has this affected the New Zealand exports to Europe?

"We are always concerned about the implication of these sorts of actions," admits Alan "But we have been pleasantly surprised that the impact has been relatively minor for NZ exports. The UK and European markets love our fruit and there is always anticipation for its arrival. "

"We are constantly looking at what all the markets are doing, we are seeing China exporting more into other Asian markets, but we are fortunate that we have our exclusive varieties which consumers around the world want. Having the IP rights for these varieties helps maintain a competitive advantage. We also produce fruit with the lowest residues of any country in the world which is important in every market these days."

"You can't look at China as a single market. New Zealand caters for a niche premium market, where there will always be demand, but we need stay on top of that. I think there will always be a demand for our high quality apples."

Crop protection and labour shortages
Interest in protected growing is increasing in New Zealand, as some areas are prone to hail. Nets used to be very expensive, but hail insurance is also expensive. There are now more cost effective netting options, but despite this it is not yet widely done in New Zealand.

Labour is a challenge in New Zealand especially as volumes and yields continue to increase while the harvest window stays the same. "Our estimate is that we may be a couple of thousand people short this season," explains Alan. "We have two schemes going at the moment, our first priority is to get unemployed New Zealanders into jobs and to train them with the skills needed to do the job. This has been quite successful, but is an increasing challenge as unemployment continues to fall. The second is the Recognised Seasonal Employer (RSE) scheme for Pacific Island workers.

Pipfruit New Zealand is working with schools, tertiary organisations, training providers and employers to provide programs which will first create interest in the industry and secondly create people with the skills which will be needed over the next 20 years and beyond. “Our estimate is that they will need 5,000 more people by 2025” Alan says.

"We have to promote first horticulture as a viable and credible career option, and then a career in the pipfruit industry within that. We need to let people see that it is lot more than just picking fruit or driving a forklift; our vertically integrated businesses are highly sophisticated offering a range of highly skilled and rewarding jobs."

For more information:
Alan Pollard
Pipfruit New Zealand
Tel: +64 6 8737080


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