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USDA Gain report:

NZ: Prospects for MY2013 apple and pear production look promising

After more than a decade of mediocre to negative profit margins deciduous fruit orchardists enjoyed a very profitable year in MY2012. Despite the biggest apple crop since MY2003, at 531,000 metric tons, and likewise a similarly large export volume now revised to 322,000MT, prices and returns were still 20% to 30% above recent years’ results. Prospects in MY2013 also look promising.

The MY2013 apple crop has been revised down to 480,500MT, a further six percent off our initial forecast, mainly because the biennial bearing “off” year caused flower bud numbers to be slightly lower than originally expected. However higher export pack-out rates have lessened the impact on the export volume, which is now revised one percent down to 301,000MT. Early indications for MY2013 are that overall prices being received are as good as last year if not better. Costs per Tray Carton Equivalent (TCE) will be up with a smaller crop but forecasts indicate another profitable year. Growers haven’t operated with two successive years of good profitability for close to 15 years.

Early ripening of fruit in MY2013 and shipping schedules that were accelerated to take advantage of early market strength has meant NZ apples have appeared in appreciable quantities in export markets up to three weeks earlier than normal. It is thought that exporters will ship big volumes quickly this year and the bulk of the shipping could be over significantly earlier than normal.

After having spiked up to 92,432MT in MY2012 NZ apple exports to Europe are likely to decline to approximately 75,000 MT in MY2013. Reportedly prices in the EU are weaker than last year and prospects for the rest of the MY2013 shipping season don’t appear as promising as MY2012.

High quality fruit and a removal of the 20% tariff has caused exports to Taiwan in the first quarter of MY2013 to surge, reaching 10,186MT compared with 1,533MT for the same period in MY2012.

Please click here to view the full USDA Gain report.
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