Strengthening fruit quality to endure longer transit shipping timelines will help ensure prospects remain positive for New Zealand’s fast-growing avocado industry with its long-term focus on developing markets outside of Australia.
New Zealand is on track to significantly lift volumes of export avocados over the next five years, following investment by growers in new orchard plantings. Historically, the New Zealand industry has shipped the bulk of its fruit across the Tasman however, industry leaders say changing market dynamics is forcing a reset, with an understanding that Asia will be expected to take on a significantly greater market share in years to come.
The New Zealand Avocado Industry recently released a five-year market plan which coincides with Avoco presenting their business plan to their grower governance group Avoco Grower Relationship Committee (AGRC). Avoco marketing and communications manager Steve Trickett says with good planning and a collective industry effort in addressing certain challenges, the horizon still looks promising.
“Although it’s hard to be accurate this far out the forecast is for significant growth,” he says. “Industry projections see the export crop growing from current levels of 4.5 to 5 million trays to around 7.5 million by 2026/2027, while the exporter group forecast is even higher. Australia remains New Zealand’s largest and most important market, however as volumes build, we need to find more homes for fruit in other global markets and we will continue to concentrate on Asia, and perhaps even see the USA back on the radar,” says Steve.
The industry has a long history with Australia and Steve is careful to point out that this market remains significant and Avoco has plans and commitments to continue to supply their key retailers and wholesalers.
“These relationships have been built up over more than 30 years and we are not giving up on that market. We just need to be realistic about increased production there and where we will place all of New Zealand’s increasing crop volume.”
The progressive reduction in the percentage of crop allocated to Australia will lead to a significant projected increase in volumes for markets beyond. Steve says while it is important to pursue new opportunities, addressing current challenges around product quality, market compliance and shipping will be a prerequisite to success.
While fruit quality remains critical, growers will also need to strive to achieve ‘all market compliance’ to give marketers flexibility and reliability in serving markets. Orchard yield and export pack percentage will become a key focus area also to underpin sustainability long term,” says Steve.
As global competition heats up there are more countries accessing New Zealand’s new and emerging markets, using price as a point of difference to penetrate.
“Success also relies on investment to develop markets. Not only in building our brand story to create a localised and compelling consumer message for each market, but more investment is needed in technical support both onshore and offshore. As well as continuing spend in trade and consumer education, Avoco is considering investment in providing in-market resources to support our customer network in selected markets”.
Although the industry focus is very much on Australasia and the Pacific Rim for the next five years, China features heavily in the future.
“Five years out we hope to see Vietnam and Indonesia added to the market mix and subject to the development of new shipping technologies and shipping services, other markets further afield can be explored,” says Steve.
“It isn’t all doom and gloom, especially when considering per capita consumption and significant population markets with a low base for growth, and the growing wealth and appetite for healthy foods – it just takes time, a lot of effort and significant investment.”