New Zealand pipfruit growers expect a small improvement in profitability this year thanks to a lift in prices, the Ministry for Primary Industries said.
The ministry, in an analysis of pipfruit production and profitability as part of its annual farm monitoring report series, said import prices in Europe were substantially higher than last year, which was helping to offset the impact the high value of the NZ dollar on returns.
The report is based on models of a Hawke's Bay and a Nelson orchard and an overview of the financial performance of typical orchards, based on information gathered from a sample of growers and industry stakeholders.
A cool spring delayed flowering and harvest by around two weeks this season. Hawke's Bay also had below-average temperatures and lack of sunny weather over summer.
Overall, production and sizing achieved was more variable than usual, with Royal Gala in particular significantly smaller.
"On the other hand, fruit colour and quality were generally excellent," the ministry said.
The delay in harvest meant a shorter window than usual for early-season sales in Asia before the arrival of competing southern hemisphere supplies.
Markets in Europe seem well-balanced, helped by a significant reduction in exports from the main southern hemisphere suppliers, the ministry said.
Import prices in Europe are substantially higher than last year, and will help to compensate for the high value of the New Zealand dollar against the Euro and the British pound, Annette Carey, a senior policy analyst at the ministry, said.
Growers are particularly welcoming the expected lift in the return for "Jazz" apple variety this year to an average $22 a carton from $19 last year.
The Hawke's Bay orchard model showed that a typical owner-operated orchard in the region should make $76,000 before tax in 2012, while the Nelson model is budgeting on a profit of $13,300 before tax. This would be the first profit achieved by the Nelson orchard model since 2008, the report said.