Psa costs Bay growers millions

A new report estimates Psa will cost Western Bay of Plenty kiwifruit growers almost $26.5 million by the end of this financial year.

The Ministry for Primary Industries (MPI) this week released its annual analysis of kiwifruit production and profitability which, for the first time, showed Psa having a significant impact.

It estimates the profit of a typical Bay of Plenty orchard will fall by a third to $44,000 before tax.

If this was true of each of the 1202 Psa infected orchards in the Western Bay of Plenty, it would cost the industry $26,444,000.

Another 152 infected orchards in Whakatane and Opotiki would bring the loss to $29,788,000 across the wider Bay of Plenty region.

The report, part of the MPI's annual farm monitoring series, is based on a model of a Bay of Plenty orchard and an overview of the financial performance of typical orchards, using information gathered from a sample of growers and industry stakeholders.

New Zealand Kiwifruit Growers president and Katikati orchard owner Neil Trebilco agreed with the estimate.

"We think the numbers are pretty accurate. I think the estimate is reasonable," he said. "Growers are going to have less money to spend this year. I think many growers are going to be relying on their banks this year."

The figures in the report only confirmed what growers already knew, he said.

Kiwifruit Vine Health chief executive Barry O'Neil said it was too early to confidently predict the impact of Psa on the industry this season.

"We really need to wait until we get a bit closer to flower," he said.

Psa was first identified in November 2010 but did not affect the yield of last year's crop for most Bay of Plenty orchards. This is due to the time lag between infection and the growth, harvesting and marketing of the crop.

A MPI statement said Psa had a greater effect on the 2012 crop as large areas of canopy had been cut out, causing the productivity per-hectare to fall for both green and gold kiwifruit.

"With Psa impacts on individual Bay of Plenty orchards ranging from none to severe, MPI has modelled three additional scenarios for 2012/13," it said.

"Under a scenario of no gold kiwifruit production, it is predicted that there would be a cash operating deficit, a pre-tax loss and a negative cash position, and an injection of additional cash would be required to cover operating costs and living expenses."

MPI also extended the kiwifruit model budget out to 2015/16, and the analysis showed deficit for the next two years.