New Zealand’s kiwifruit industry is on a powerful growth trajectory. This is largely driven by the extraordinary success of the SunGold variety, which is sought-after by a growing number of consumers around the world. Zespri, the world’s largest marketer of kiwifruit, has developed a hugely successful brand that stands for quality and commands top prices globally.
With the SunGold variety powering the industry’s growth, the new Zespri Red variety has the potential to capture premium markets and create new opportunities. There’s plenty of room for expansion so it’s a great time to take advantage of SCH’s track record of developing top-quality, fast-cropping orchards.
As New Zealand’s single desk exporter, Zespri is the world’s largest marketer of kiwifruit, selling to more than 50 countries and targeting global kiwifruit sales of $4.5 billion by 2025. Since 2014, Zespri has achieved 15% compounded annual growth in sales.
Zespri has developed a hugely successful brand that stands for quality and commands premium prices globally. Responsible for approximately one-third of global trade in kiwifruit, Zespri-branded fruit is now enjoyed 12 months of the year by consumers around the world.
While the traditional green Hayward variety still comprises roughly half of kiwifruit production, the production and sales of SunGold kiwifruit are growing rapidly and generating high Orchard Gate Returns (OGR) for growers. SunGold now comprises more than 50% of sales, surpassing Hayward.
Since 2015, Zespri’s tray sales have increased by a compounding 8.8% per annum. Hayward tray sales have been relatively stable across this period, while SunGold tray sales has achieved compounded average growth of 31.4% per annum.
The success of the SunGold variety has been the primary driver of growth in the New Zealand industry in recent years. Zespri owns the worldwide plant variety rights (PVR) to SunGold, which is sought after by a growing number of consumers around the world due to its taste and consistent quality, health and nutrition attributes, and convenience.
In December 2019, the Zespri Board approved the commercialisation of a new red kiwifruit cultivar. Zespri RubyRed is a premium product, and research confirms it a nutritionally rich fruit with higher vitamin C and potassium levels than other fruits, and higher concentrations of both than Hayward and SunGold. Zespri Red also contains polyphenols which contribute to antioxidant capacity and, while higher on the Glycaemic Index (GI) than Hayward and SunGold, it is still low GI making it suitable for those concerned with blood sugar levels.
The launch of Zespri RubyRed aligns well with current international trends for increased consumption of premium fruit, and market research indicates it could attract customers of other premium and exotic fruits, rather than being substituted for Zespri’s other kiwifruit varieties.
SCH already has experience with Zespri Red, planting small pre-commercial trials in 2017 and 2018 and actively monitoring the performance of the oldest Zespri RubyRed vines from Zespri pre-commercial trials. This accumulated knowledge will inform its future developments.
Kiwifruit is already New Zealand’s largest horticulture export, and global demand for kiwifruit has largely been unaffected by the COVID-19 pandemic. The next 20 years could prove even more fruitful, and New Zealand needs more orchards, growers and investors to support this growth.
There’s a growing desire for healthy foods, driven by a focus on health and wellness, ageing populations, and growing middle classes in developing economies. Consumers also want food that comes from safe, trusted producers.
Zespri has achieved good penetration in Asian and European markets, but kiwifruit consumption is still an under-developed category at only 1.2% of all internationally-traded fruit. Substantial markets such as the USA and Canada are largely untapped and represent a significant opportunity for future growth.