Wednesday 18th January 2017
|Text too small?|
New Zealand’s kiwifruit industry continues to surge ahead and a recent orchard sale underscores confidence in the sector.
A 66-hectare kiwifruit orchard in the Hawkes Bay area recently sold for $40.2 million, something PGG Wrightson Real Estate general manager Peter Newbold said was unusual.
“Not many of this size come on the market. Kiwifruit orchards normally sell in the 100s of thousands or single digit millions,” he said.
Just over six years ago, New Zealand’s Kiwifruit sector was decimated by a bacterial disease called PSA-V or Pseudomonas syringae pv Actinidiae. Zespri International, which controls exports of New Zealand’s Kiwifruit has instead focused on marketing and developing gold varieties that have proven to be more resistant to the diseases. That strategy is now paying dividends with the latest season marked by record sales and the highest ever grower returns. Total sales revenue for the 2015-16 season was $1.9 billion, up 22 percent on the year.
Newbold said the orchard sale attracted overseas interest and there were a number of genuine inquiries and solid tender offers. The orchard was sold to the Ngai Tukairangi Trust, which already has kiwifruit interests. The trust was not immediately available for comment.
The property, which grows SunGold kiwifruit, sold for $700,000 per canopy hectare and Newbold said more upside might be possible. He said the price per canopy hectare had risen from around $400,000 two years ago.
“The returns are driving the per canopy rate and I think there’s a good future at the moment. Without overdoing it, we think demand will continue,” he said.
Late last year, Zespri announced it would sell licences for another 400 hectares of the SunGold variety in 2017, with a further 400ha to be released in 2018, 2019 and 2020 subject to the product's performance and global demand.
Newbold noted that people are more confident about Kiwifruit and “the whole horticulture space is in good stride,” he said.
Fruit was New Zealand’s fourth-largest export in the 12 months ending November.
No comments yet
MARKET CLOSE: NZ shares fall as raft of earnings loom; Heartland, Fletcher drop, Sky TV, Air NZ gain
NZ dollar falls vs greenback, Aussie as investors seek clues over diverging rate tracks
NZ's housing-related imbalances set to peak in 2018, S&P Global says
Bapcor's ex-Hellaby auto unit still exceeding expectations
KiwiRail operating earnings rise despite Kaikoura line outage
Used car import body says 'short-term' hit from MPI's stink bug strategy worth it
CBL's European subsidiary fights Irish central bank ban on new business
ASX-listed Super Retail Group pays $144M for Macpac, more than twice the 2015 price
Mark Tume appointed chair of Ngāi Tahu Holdings board
ANZ extends Veritas' debt for a third time, seeking shareholder approval to sell Mad Butcher