North America is set to be Zespri’s next kiwifruit growing territory as consumer demand there soars for its Sungold variety. Chief executive Dan Mathieson said Sungold sales jumped 32 per cent this year in the US and Canada. Trials are underway to grow the fruit locally to meet demand in what is becoming a major target market for the Mount Maunganui-headquartered global kiwifruit marketer.
Total Zespri sales in North America this year will be 8.2 million trays, compared to 5.1m last year, Mathieson said.
Sungold fruit comprised 4.7m trays, compared to 3.3m last year while 2.6 million green fruit trays were sold against 1.3m. Zespri also cashed in on what Mathieson called an organic foods boom across North America, with 640,000 organic fruit trays sold compared to 370,000 last year. Much of the Sungold fruit for North America was sourced from Zespri’s Italian growers.
Zespri has been pushing hard into North America for about four years. Its target consumer cities include New York, Chicago, Washington DC, Los Angeles and Boston. The company now has an office in California and 12 account managers across the US. “We expect to see demand grow and we want to make sure we have great quality fruit available for North American customers for 12 months of the year. We believe the best result would be locally grown quality fruit.”
The New Zealand kiwifruit harvest kicks off about March. Zespri transitions to supplies from its northern hemisphere-contracted growers in Italy in September to fill the gap until New Zealand orchards are producing again. Zespri-branded fruit is also grown in France, Japan and Korea for those markets. Around 150 million trays, equivalent to 520,000 tonnes of kiwifruit were shipped in the New Zealand season this year. Zespri’s revenue was $2.4 billion in the 2018 financial year.
About 80 per cent of Zespri fruit is grown in New Zealand.
“I think for the foreseeable future the majority of our fruit will be grown in New Zealand. As we look out in our 10 year plan towards 2025 it will still be about 80 per cent … New Zealand and 20 per cent grown in the northern hemisphere for those four or five months when we can’t supply from New Zealand,” Mathieson said.
“What we are focused on at the moment is trying to create sources of really great quality fruit outside New Zealand. But rather than going far and wide we want to focus in, and we see Italy as a really good opportunity to do that. It’s very similar to New Zealand and we believe we can scale up production more quickly there than in other areas. That will be our focus.” Mathieson expects sales of Sungold, a variety that helped the industry recover from a severe strike of the bacterial disease Psa in 2010, will overtake green sales next year or in 2020 for the first time.
“In North America, Sungold sales are already double the volume of our Zespri green.”
But there’s still a future for New Zealand green kiwifruit, he said. “Sungold has become such an exciting fruit because it’s helped raise the profile of all our fruit (varieties). It’s certainly helped bring more customers to the kiwifruit category. When they come to it they are buying green, gold and organic products.” Sungold has revitalised the market for kiwifruit because it has a very consistent sweet flavour, unlike green fruit which, because it is grown in so many countries, can have a marked difference in quality, he said.
Consumers who had a bad experience with a green fruit were likely lost to the market before Sungold was developed. Also Sungold was always ready to eat. It was considered a “convenience” fruit, like bananas, apples and oranges, he said. But kiwifruit was still “tiny in the world of fresh fruits”, said Mathieson. “It’s still only about point five of total fruit consumption so having three categories in our portfolio helps us get more shelf space and more consumers to the category.” Along with mainstream fruit, whole berries are emerging strong competition for Zespri kiwifruit in North America, Mathieson said. Like kiwifruit, berries are marketed as healthy and nutritious and are convenient to eat.