Zespri has announced its 2020-21 financial results, reporting record global operating revenue of $3.89 billion, with global fruit sales accounting for $3.58b. This has accompanied a lift in profit of 45% to $290.5 million.
Plant variety licencing for the high-value SunGold fruit now forms a significant part of the company’s income stream and grower dividend payout, with last year’s tender round generating over $300m or about 8% of total revenue.
This year’s tender round has surged even further, with growers laying out almost $430m in licences for SunGold and the new Red variety.
For growers, the 2020-21 returns mark record levels.
They equate to an average Green tray value of $7.51, or average per hectare return of $76,722. Green’s Organic premium has grown, with the variety fetching $10.53 a tray.
SunGold fruit returned an average of $12.46 a tray, equating to an average of $177,846 a hectare.
Zespri chief executive Dan Mathieson says it had been a Herculean task to harvest last season’s crop during lockdown, and the industry continued to face significant labour constraints at home.
In the meantime, shipping and logistics challenges continued to exist, both portside here and in overseas markets.
“Our delivered volumes to date are up 25% on the same time last year under some very challenging circumstances,” Mathieson said.
“While we have built up our charter vessel fleet to take 65% of the crop, we are still relying upon containers for the rest. There are delays, a lack of ships and scheduling and port congestion both here and overseas.”
Despite this, he says to date fruit quality on arrival is still being reported as excellent, with no spoilage losses attributable.
“But this is something we will have to watch throughout the season,” he said.
The industry is managing to continue to extract value increases out of its fruit, with the 14% increase in fruit sales revenue outstripping the 10% increase in fruit volumes.
Earnings returned to New Zealand growers also increased by 15% to $2.25b.
Mathieson says Zespri was confident this season would continue to experience gains in value, with consumers clamouring for the SunGold fruit.
“And we have had a very good growing season, with good increases in SunGold volumes and organic crop,” he said.
This was likely to see the sector hit about 175 million trays of locally-grown fruit, only a few million short of its total NZ-overseas combined crop recorded last season.
Zespri is hoping to grow its Northern Hemisphere volumes after a tough growing season last year that resulted in significant crop losses due to frost, with the aim to get back to about 23m trays.
Greece is now the only country outside of NZ and China growing increasing volumes of Green crop, and now supplies almost a third of Zespri’s European Green crop.
Consumer demand continues to grow, and Mathieson says covid-19 had been a catalyst for even stronger growth.
“Consumers are looking for better, healthier food. They are not eating out as much, demand has grown and grown, helped by our value and position. We expect this to continue,” he said.
Mathieson says continuing high prices for SunGold growing licences which exceeded $500,000 a hectare this year reflected continuing growth in the fruit’s value.
“We are seeing a wide spread of growers having both Green and SunGold, which is good,” he said.
“There is also strong interest in Red, with good consumer acceptance.”
