Zespri’s Annus Horribilis Continues


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Fruit quality losses incurred over this year’s harvest are hitting home hard for Zespri kiwifruit growers this summer. A late February board announcement has confirmed what many had been warned to expect, with Green kiwifruit growers experiencing a further 58c a tray reduction in payments and organic Green growers a 79c a tray reduction from what they expected last November.

The news comes after the announcement back in August 2022 when growers were informed of a $1.95 per tray reduction in Green payments and SunGold growers had a reduction of $2.80 per tray.

The latest reduction has Green growers likely to take a collective hit of $40 million across the 70 million trays harvested, on top of the $136 million already dealt to them back in August. It will leave over half Green growers barely breaking even this season.

The earlier August 2022 announcement had been accompanied by the revelation the fruit being sent to market had been the worst since early 2000s, with some fruit so bland Zespri’s own Asian GM had described them as potatoes.

Soft, stained, and rotted fruit started to reveal itself post-harvest and had failed to fulfil Zespri’s long held brand promise of delivering premium quality fruit. Chinese social media had also started to fire up on fruit quality there.

In a series of town hall meetings across the region recently, Zespri CEO Dan Mathieson has been delivering the bad news last season’s crop quality has dealt the sector. The latest payment downgrade comes from very poor quality fruit shipped in the final two export loads of the season to Asia and Europe.

Zespri chairman Bruce Cameron confirmed the write downs in a written statement to growers late February, coming after what he acknowledged has been a particularly tough year for the sector.

The news has been met with anger and dismay by growers, prompting grower group New Zealand Kiwifruit Growers Incorporated (NZKGI) to fire a sharply worded letter to the Zespri board.

In it NZKGI chair Mark Mayston asks the board to explain how they got their initial orchard gate return estimate so wrong back in November, and how the latest announcement was an extreme deviation from what they had been led to expect last November.

In the letter Mayston challenges Zespri’s supply chain transparency, grower communications and forecasting ability, denting grower confidence in the single seller model.

Industry insiders are pointing to labour shortages as the key reason for poor quality fruit outcome, and a rise in Psa infections has also been reported in some orchards.

Growers have reported poor quality harvesting techniques from contracted picking gangs resulting in fruit damage that only appears as fruit ripens, either in cool storage or on the shelf.

The bad news has continued to pile up for the sector, with Cyclone Gabrielle also hitting some Gisborne and Hawke’s Bay orchards hard, many only in early stages of establishment.

Meantime a summer with low sunshine hours and high levels of rainfall is playing havoc with efforts to ripen fruit in time for this year’ harvest, as summer daylight hours start to shorten rapidly.

Dan Mathieson has been assuring growers at a series of town hall meetings in Katikati and Te Puke Zespri has been digging deep to determine how it got its November forecast so wrong, leaving growers well short in February.

He has acknowledged the original payment forecast was “significantly overstated”, and apologised to growers for this.

He also acknowledged the on-going impacts the season’s atrocious weather was having on the sector, and said Zespri intended to continue to work closely with NZKGI to support growers.

Related: Zespri Red to become Zespri RubyRed™

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