23 Jan 2023

Pay cuts for kiwifruit growers as quality deteriorates

2:29 pm on 23 January 2023
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Fruit loss in Europe was estimated at about 20 percent. Photo: RNZ/Carol Stiles

Quality issues are continuing to haunt kiwifruit growers, with marketer Zespri informing orchardists the problem is now worse than first anticipated.

In a letter sent to growers on Friday, Zespri chief executive Dan Mathieson said quality issues had kept building as the 2022 kiwifruit season drew to a close.

"Demand for our fruit has remained as expected and we completed the 2022 season in line with previous years. However, we have seen further deterioration in the fruit quality of our final vessels, particularly in the final shipments of our Green varieties into Europe and Asia."

Mathieson said at the time of its previous forecast, fruit loss in Europe was estimated at approximately 7 percent for the last quarter of 2022, but that estimate had now been revised to about 20 percent.

"Quality claims from customers are also estimated to be nearly three times the level we experienced in 2021, and more significant than anticipated in the prior forecast," he said.

Higher fruit loss in New Zealand meant Japan was undersupplied by more than a million trays, with poorer fruit quality than anticipated in Japan also impacting Zespri's market mix, Mathieson said.

Due to these problems, Zespri planned to downgrade its payments to green kiwifruit growers, likely by more than 60 cents per tray for Green and 50 cents for Green Organic growers, although that was still subject to finalisation.

This would have a significant impact on returns for green kiwifruit growers, he said.

"We understand how tough this will be for growers at the end of what has been a very hard year.

"This is not the sort of news that any of us wanted to start the year and it is a further reminder of the importance of addressing our fruit quality given the amount of value we have lost through quality costs."

Mathieson said it was positive that despite the quality issues, it had continued to see demand for Zespri fruit.

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