Kiwifruit exporter, Zespri says it is boosting its "loyalty payment" by 66.6% in the 2011 season, when returns are likely to be mixed, with conventional green kiwifruit up slightly, gold fruit steady and organic green facing a "challenging&
Kiwifruit exporter, Zespri says it is boosting its "loyalty payment" by 66.6% in the 2011 season, when returns are likely to be mixed, with conventional green kiwifruit up slightly, gold fruit steady and organic green facing a "challenging" time.
The problems ahead for organic green fruit reflected an increase in supply and mixed effects for the category, Zespri chief executive Lain Jager said.
Kiwifruit have been a flagship product for the organic exports sector, and remain the single most important organic product.
Zespri said today it expected to significantly boost its "loyalty payment" from 15c/tray this season to 25c/tray in 2011.
Set at 16.5c/tray for 2008/09, the loyalty payment was initially a 10c/tray premium offered to growers in 2004 if they promised to supply only Zespri for three years.
It was seen as providing insurance against further deregulation of the kiwifruit sector, and as a way to reduce sale of top quality fruit being legally sent to Australia and then re-exported.
In the past three years Zespri has come under increasing pressure from a rival, Turners and Growers, which is taking legal action in a bid to have kiwifruit deregulated.
In 2007, the loyalty payments were boosted by 150 percent, when the company reminded growers that the integrated industry structure "provides us with the critical mass needed to generate premium returns".
Mr Jager today said the predictions for 2011 were only a very early indication of returns and Zespri would not release the full forecast until August.
In the meantime, the indicative returns per tray, not including the loyalty payment, for 2011 (with 2010 final returns in brackets) were: Zespri green $7-$7.5 ($7), green organic $8.40-$8.90 ($8.96) and Zespri gold $12 to $12.50 ($12.13).
Mr Jager said early season sales had given Zespri confidence that the markets would respond positively to the excellent eating quality of the fruit.
There had been lower crop loadings resulting from poor fruit set, but instead of the lighter crop causing vines to create large individual fruit, very dry weather in growing regions had produced excellent sugar levels, and high levels of dry matter, often used as an indicator of good taste.
"With strong early season delivery, we are well positioned for the season and expecting a modest recovery in local market returns, following a very challenging season last year," Mr Jager said.
Zespri had clear plans in place for each category which would be published in a three-year outlook to be published in November.
"The focus is on working closely with our customers to achieve the best result possible for growers with the excellent fruit quality we have been blessed with this season," he said.
