In all its markets, Zespri is committed to a twelve month supply of kiwifruit. Most of the supply for the Chinese market is coming from New Zealand. To bridge the months that New Zealand has no domestic production to send to China, Zespri currently sources the fruit from Italy. The company is researching possibilities to supply the Chinese market with domestically grown varieties. In order to so do, it is running a three-year trial programme in Shaanxi Province, at the heart of the Chinese kiwifruit industry.
Sheila McCann-Morrison is responsible for Zespri’s non-New Zealand kiwifruit supply. Outside New Zealand, Zespri grows kiwifruit in Italy, France, Japan and Korea. In addition to China, the company is also running trial programmes in several European countries and will start trials in the US this year.
“The reason why Zespri has launched its trial programmes in China is twofold. We want to be able to supply our products the full year round. It is important for retailers to be able to have a product on offer for twelve months a year, and it is important for a brand to be constantly visible on the shelves in order to invest in it. This is why the non-New Zealand supply is important for our company and brand. China is on track to become our number one market globally. We want to look at the potential of domestic supply for three to four months in the year, when there is no supply coming in from New Zealand,” explains McCann-Morrison.
Kiwifruit is a fruit native to China and there are numerous varieties on the local market that cannot be found anywhere else. Domestic fruit production and the quality of locally grown produce is improving. In addition, strong local brands are starting to emerge.
“China, being the size that it is and, given the specifics of the domestic market, is a challenging environment. We are taking our time, trying to determine whether we can endorse a Zespri quality kiwifruit grown in China. That means, in terms of fruit quality, fruit safety, and all other factors that support our brand around the world. We might actually find varieties in China that are better suited to Chinese consumers than the fruit we are growing elsewhere. The trials that we are conducting are using local kiwifruit varieties.”
“Through the consumer insight work that is done by our marketing team, we are discovering that Chinese consumers are becoming more and more willing to accept domestically produced goods. We are confident that because of the work Zespri does in areas of fruit safety, compliance, as well as taste and quality, we will be able to maintain our premium. Also when the fruit is produced domestically. So the assumption is that we will be able to receive a premium for our products, just as we do with fruit from other non-New Zealand sources like Italy and France. We will not know however until we test the fruit on the shelf. ”
Trial programme
Zespri has just come to the end of the first year of a-three year trial programme the company has launched to establish whether it can sustainably grow quality kiwifruit in China.
“We hope that after three years of working locally, we should get a good idea whether it is possible to get orchards up to the necessary Zespri levels, in terms of productivity, compliance with Global GAP, and the other criteria that we require. We will also determine whether there is a sufficiently robust infrastructure to ensure that once the fruit leaves the orchards, it arrives to the market in a good state.”
“Building relationships with different stakeholders, from the government down to the small growers, is key. We are working with the Shaanxi Provincial Fruit Administration Bureau, which is under the auspices of the Shaanxi Agricultural Bureau, Northwestern Agriculture and Forestry University and we have established demonstration blocks in Shaanxi together with two corporate partners; the Hehe Group, and the Haisheng Group. With both we are working with green varieties. The project includes technical exchange, production trials and varietal assessments. We bring growers over from New Zealand to provide Chinese partners with knowledge and vice versa. We do varietal assessments, which includes the testing of Chinese varieties in consumer testing panels in China.
PVR protection
“We have spoken to a lot of our peers in the fresh produce industry and have learned from them how they are protecting their plant variety rights (PVR). PVR laws do exist in China. However, execution is where it gets tricky. Also, some facets of the PVR protection laws protect small, family growers. That is where things get complicated. It is difficult to protect if it is in the hands of small family growers.”
“What we would like to do most is to work closely with local communities and involve the local, small growers. If we manage to get these parties committed, there will be a desire on their part as well to protect the PVR from spreading. No one would benefit from the PVR spreading; neither the growers with whom we are working, or the market. Because without the full Zespri system and the controls we have in place from grower to the shelf, we would not be seeing the full quality product if it was not under the guidance of Zespri.”
For more information:
Rachel Lynch
Zespri International Limited
Tel: +64 7 572 7757
rachel.lynch@zespri.com
http://www.zespri.com/