Thirsty vines Summer girdling Compost teas Organic marketing The ...

Figure 2: Discussing orchard cash fl ows and budgeting with fi eld day attendees.
• An increase in the number of ]kiwifruit varieties that will
be marketed to consumers in a range of formats (not just
fresh fruit)
• Industry consolidation and an increase in the number of major
players
• More challenging standards in both tangible issues such as the
use of chemicals and in less tangible areas such as social
equity
As we move forward the New Zealand kiwifruit industry, through
the ZESPRI Brand and supported by the ZESPRI System, is well
positioned for these potential changes.
WHAT SHOULD AN ORCHARDIST’S STRATEGY BE?
What do orchardists need to be thinking about to improve their
profi tability over time? From an individual orchardist’s perspective,
the profi tability of their operation is a function of the fruit price
received multiplied by the yield produced, less production costs.
Profi tability = (Price x Yield) - Cost
In terms of price, there is a trend within the industry for a greater
proportion of returns to be associated with premium payments.
Therefore, an orchardist can infl uence the price they receive for
their fruit by their ability to attract more premium payments. There
are two types of fruit payments. For some fruit payment categories,
everyone receives a proportion, an example being taste payments
to reward the production of high dry matter fruit. For other payment
categories, some growers receive no payment, such as incentives
for pest free fruit or supply to specifi c markets. An orchardist can
increase the price they receive for their fruit by increasing the
number and level of premiums that their fruit qualifi es for. Some of
the orchardists within the Focus Orchard Network (FON) are looking
to maximising taste premiums, others targeting the premiums for
early supply and pest free status.
Real orchard yield is the number of trays of fruit sold in the export
markets, and yield is the main determinant of orchard profi tability.
Real yield is a function of the volume of fruit produced that meets
export grade standards, including phytosanitory, food safety and
production standard requirements, and can be marketed. Orchard
yield can be maximised by lifting production, minimising both
fruit reject rates and fruitloss, and meeting market access
requirements.
We need to be cost effi cient, but remember that orchard income is
dependent on producing a good quality crop that meets consumer,
customer and market demands. In terms of cost cutting, it can be
false economy to compromise on production costs. The example
was given by Fred Jordan, one of the FON participants, who in past
years of low returns cut back on thinning costs by doing it all himself,
which resulted in some of the required thinning not being
completed, compromising his yields . The reduced yields can cost
much more than any savings made on reduced orchard
operations.
All the FON participants have developed management strategies
for improving orchard profi tability revolving around increasing yields,
and/or increasing premium payments received for the fruit before
considering cost reduction. These FON growers are looking to
NZ KIWIFRUIT JOURNAL JANUARY / FEBRUARY 2008
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