Zespri set for record exports

By LIAM DANN

Zespri says it is on track to export a record crop of kiwifruit this year.

But the big volumes won't be enough to offset the effect of the high New Zealand dollar, according to the general manager of global marketing, Peter Luxton.

Zespri estimates it will sell almost 60 million trays of green kiwifruit this season. Sales of the gold variety will be about 14 million trays - up from 8.5 million last year - and organic volumes will be steady at 2.5 million trays.

This compares with total volumes of just 62.2 million trays last year.

In the past two seasons Zespri had been short of both green and gold fruit because of things like frost and hail, Luxton said.

There were fantastic weather conditions during pollination and flowering last spring through until February, and after February's rain, good ripening conditions through March and April.

With the high dollar already expected to eat into grower returns this year Zespri would need to carefully manage the supply of its fruit into international markets, Luxton said.

Traditionally in horticulture additional volume equated to lower prices so that revenue ended up about the same.

"With the way we market our product we are typically better able to manage that," he said. "Maybe we can't sell all of it for the same price but for the last few years we have either sold bigger volumes or sold the same volumes more quickly and managed to put the price up."

But foreign exchange rates would have a big impact this year.

Though the kiwi had fallen in recent weeks against the US dollar, the euro and yen were more important currencies for Zespri.

The foreign exchange cover Zespri had in place would also get spread more thinly in a high volume season, Luxton said.

Zespri doubled its profit and returned record dividends to shareholders last season, despite the rising dollar, recession in key markets and a frost-affected season.

Net kiwifruit sales rose to $860 million, up from $800 million the year before. Of that, $520 million was returned to growers at an average of $8.51 a tray.

In March chief executive Tim Goodacre signalled that the high dollar would cut grower returns by about a dollar a tray.

"We've got good volumes, the markets are looking very promising but whatever local currency returns we make in those markets we're still going to finish up with less New Zealand dollars," Luxton said.