Asian Markets Drive Recovery in New Zealand's Fresh Apple Exports

In the wake of Cyclone Gabrielle's devastation, New Zealand's apple industry is turning around, mainly due to burgeoning demand from Asian markets. As New Zealand emerges from a 15-year production low, the latest forecasts and trade dynamics point to a more positive export season. On Feb 23, Cyclone Gabrielle caused considerable floods and strong winds in the key apple-producing regions of Hawke's Bay and Gisborne, severely damaging numerous orchards. As a result, total production for the 2022/23 season was 443,000 metric tons (mt), the lowest since 2007/08.

However, New Zealand fresh apple production is set to rebound to 480,000 mt in the 2023/24 season. Notable factors contributing to increased apple production in New Zealand include favorable El Niño weather patterns, farm system innovations, and an increase in seasonal labor through the Recognized Seasonal Employer (RSE) scheme. However, the path to recovery has not been without its challenges. Due to dry conditions, the cyclone's impact significantly reduced planted areas and led to smaller fruit sizes, making the apples smaller. New Zealand's Ministry for Primary Industries anticipates that the country's apple planting area for the 2023/24 season will be around 9,200 hectares (ha), with 9,000 ha harvested.

Figure 1: New Zealand Fresh Apple Export Volume 2019-2023

Source: Tridge

Despite these hurdles, New Zealand's apple exports are recovering, especially in Asian markets. The Q1-24 export volume increased by 36.08% YoY to 58,058.81 mt compared to the same period in 2023, indicating a solid rebound in production and infrastructure. In 2023, 55.8% (45,600 mt) of the 81,700 mt of fresh apples imported into China came from New Zealand, highlighting the country's significant market share in China. China and India were the leading New Zealand fresh apple markets in Q1-24, with India showing the most substantial export growth of 495.53 % YoY to 11,080.76 mt in the observed period. Besides China, Vietnam, Taiwan, the United States (US) and Thailand are expected to sustain New Zealand's fresh apple exports.

The New Zealand fresh apple industry is also capitalizing on opportunities by shifting focus to newer, premium apple varieties like Rockit, which promise higher returns and meet the demand for high-quality produce. Additionally, the prospect of tariff relief and expanded quotas from Free Trade Agreements (FTAs) with the United Kingdom (UK) and the European Union (EU) present further avenues for growth.

As New Zealand's apple industry navigates the post-cyclone landscape, its counter-seasonal production advantage and strategic focus on Asian markets are pivotal in driving its export recovery. Tridge expects that, with a combination of strategic market positioning and a commitment to quality, the New Zealand fresh apple industry is poised to solidify its standing in the global apple market.