Kiwifruit

This report contains the key results from the Ministry of Agriculture and Forestry’s 2008 kiwifruit monitoring programme. The full Horticulture and Arable Monitoring Report 2008 will be available in September 2008.

Key points

  • In 2007/08, production per hectare on the model orchard rose by 11 percent compared with the previous season, as a result of good seasonal conditions. Production in 2008/09 is expected to rise by a further 4 percent. The adoption of new management techniques is leading to sustained increases in average yields per hectare.
  • Orchard gate returns per tray fell in 2007/08 as a result of unfavourable exchange rate movements, increased crop volume, smaller fruit size in the green variety, and higher post-harvest and shipping costs. Prices are expected to improve in 2008/09 due to favourable opening market conditions in the EU, good fruit size and quality, an early start to the season and reduced foreign exchange rate impacts.
  • Orchard working expenses fell by 6 percent in 2007/08 on the model orchard, but are expected to rise by a similar percentage in 2008/09 due to increased wage rates and input prices. Growers cut spending in 2007/08 in response to lower revenue, aided by seasonal factors such as reduced fruit thinning and frost fighting requirements.
  • The model orchard made a loss before tax in 2007/08, and is expected to make a small taxable profit in 2008/09. These profit levels are well below those achieved in the period from 1999/2000 to 2003/04, and are primarily the result of an exchange-rate related fall in orchard gate returns, rather than falling international prices.
  • The model orchard surplus for reinvestment remains negative in 2007/08 and 2008/09. However, orchard maintenance and development is continuing, albeit at reduced levels, as many growers have off-orchard income and/or investments, and most have high equity levels, providing a degree of financial resilience.

Table 1: Key parameters, financial results and forecast for the kiwifruit model orchard

Kiwifruit model orchard budget and expenditure

Table 2: Kiwifruit model orchard budget

Table 3: Kiwifruit model orchard expenditure

Kiwifuit model orchard profitability trends

Figure 1: Kiwifruit model orchard profitability trends

Figure 1: Kiwifruit profitability trends

Information about the model

The model kiwifruit orchard is in the Bay of Plenty, the growing region that produces around 80 percent of the New Zealand kiwifruit crop. The model budget represents an established owner-operator orchard. The model is created from data collected from 17 orchards located from Te Puke to north of Katikati, and information from a wide cross-section of agribusiness representatives.

Financial data relates to the year ending 31 March. Kiwifruit income spans two financial years, with the residual payment for each crop occurring in the next financial year. For example, final payments on the crop harvested in May 2007 occur in the 2008/09 forecast year.

The aim of the model is to typify an average kiwifruit orchard for the region. Budget figures are averaged from the contributing orchards and adjusted to represent real orchards. Income figures include off-orchard income, new borrowing, and other cash income. Expenditure figures include costs of management, production, debt, leasing, drawings, and development and capital purchases.

For more information on this model contact: irene.parminter@maf.govt.nz.

Published by:
MAF Policy
Ministry of Agriculture and Forestry
Pastoral House
25 The Terrace
PO Box 2526
Wellington 6140
New Zealand
Tel: 64 4 894 0100
Fax: 64 4 894 0720

Web: www.maf.govt.nz

ISSN 1178-2765 (Online)

© Crown copyright - Ministry of Agriculture and Forestry 2008

The information in this report by the Ministry of Agriculture and Forestry is based on the best information available to the Ministry at the time it was drawn up and all due care was exercised in its preparation. As it is not possible to foresee all uses of this information or to predict all future developments and trends, any subsequent action that relies on the accuracy of the information in this report is the sole commercial decision of the user and is taken at his/her own risk. Accordingly, the Ministry of Agriculture and Forestry disclaims any liability whatsoever for any losses or damages arising out of the use of this information, or in respect of any actions taken.

 

Contact for Enquiries

Manager
Monitoring and Evaluation
MAF Policy
PO Box 2526
Wellington
NEW ZEALAND
Phone: +64 4 894 0623
Fax: +64 4 894 0741
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