Zespri profit dips but growers paid record prices for fruit

Kiwifruit marketing company Zespri's profit has dipped 27 percent but growers have been paid record prices for their fruit.

It has just reported a net profit after tax of $173.3 million for the 2023-24 financial year - down from $238.7m the year before.

Chief executive Dan Mathieson said the drop was mainly driven by reduced licence revenue from lower pricing per hectare than 2022/23.

"While a difficult growing season resulted in global sales volumes falling 10.5 percent to 164.2 million trays from 183.5 million in 2022, global kiwifruit sales increased 2 percent to $3.99 billion, reflecting improved fruit quality and strong pricing secured throughout the season."

That improved fruit quality and increase in sales means growers have been rewarded with higher profits - with record per tray returns for all categories apart from organic SunGold.

Those who grow green kiwifruit saw the biggest jump, getting paid $9.55 a tray for the 2023-24 season up from $5.78 for the 2022-23 season.

Oraganic green rose from $8.68 to $12.53 per tray while Sungold was up from $9.97 to $12.92.

For the newer RubyRed variety, growers were paid $26.34 a tray for the 2023-24 season up from $22.27 the year before.

Mathieson said Zespri was delighted to be able to deliver such a strong set of returns to growers after such a challenging period for the industry.

"These strong per tray returns have been driven by improved quality and good pricing alongside our investment in the brand and ability to build demand ahead of supply."

Mathieson said there were some standout results in some of Zespri's major markets.

"We're really pleased with how things have gone in Europe, particularly in being able to deliver really strong value for our Green growers, and that's been supported by strong value for Green fruit in Japan too.

"China was a standout in terms of being able to deliver strong value for SunGold, reflecting the demand we're continuing to see for this variety, RubyRed Kiwifruit is also continuing to perform strongly and offers us a great platform to start our season in our Asia Pacific markets."

But he said it had been tougher for organic varieties.

"Particularly on a per hectare level where a really big drop in yields has made it challenging, and continuing to lift per hectare returns across all categories as we manage greater volumes remains a focus for us looking ahead."

Zespri's Non-New Zealand Supply season sales increased to $654.2m, up from $519.3m on the back of increased volumes sold of 27.2 million trays, improved pricing and a reduction in quality costs.

"Our offshore production bases are a critical part of Zespri's Global Supply strategy helping us to build the brand, to hold shelf space and to maintain our retail and supply partnerships.

"It's pleasing to see global supply sales increasing to support the launch of our New Zealand sales season, helping deliver stronger returns to growers in New Zealand and around the world."

Mathieson said the results were a credit to the way the industry has responded to recent challenges.

"It's been pleasing to see the positive momentum continue with the fantastic start made to the 2024/25 season."