John Lewitt
Head of Operations & Logistics

First quarter update

We started our packing season on the 28th of February packing RubyRed in Packhouse 2. We have now completed all our RubyRed packing for the season and our total volume packed was 125,000 trays, which is three times the volume we packed last season.

While the SunGold harvest season started relatively slowly compared to a normal season, we are still well ahead of 2023 packed volumes.  As of 26 March, the industry had packed just under 25 million trays of fruit compared with only 6.7 million trays at the same time last year.

Hayward clearances have been slow to come through and as of 26 March, we had still not packed any trays of fruit in this fruit group.

All 10 of our shifts have been up and running since the 21st of March and are operating seven days a week across both day and night shifts, on all four of our export packing lines. This is well ahead of last season, when we didn’t start our last shifts until early April.

The availability of seasonal staff has been good, and all our shifts operate at, or close to, our budgeted staff numbers.

The fruit arriving on site so far this season has been in good condition overall, with low levels of explosives and low levels of physical damage cuts. We are hopeful this trend will continue for the remainder of KiwiStart and through to Mainpack. We are very appreciative of the efforts by the harvest contractors and growers to ensure fruit arrives ready for packing in the best condition possible.

Mike Perrett
Head of Kiwifruit Grower Services

Harvest update

After the reduction in crop volume in the 22/23 season due to climatic conditions; frost, hail and poor budbreak, we began the 23/24 season by significantly increasing our winter bud numbers to ensure a higher yield was possible.

A combination of higher winter chill hours and the increased bud numbers produced a good budbreak across all varieties. Regular rainfall events through the spring and summer months coupled with sufficient sunshine hours have allowed the fruit to size well even with the increased volume.

An increase in available orchard staff over the 23/24 season has allowed us to fine-tune the crops in a timely manner and complete the required canopy work to a high level, further improving fruit quality.

Poor pollination in some Hayward orchards has led to higher-than-normal thinning costs, but generally these orchards have respectable crops remaining.

For Gold orchards, TMO’s focus has been on managing fruit numbers to productive levels – a range of 55 to 70 fruit per square metre.

Canopy growth has been strong, and there has been additional effort placed on controlling vine growth to both keep the canopy open and set up next year’s fruiting wood.

Maturity monitoring data to date suggests that fruit size is smaller than last season, but dry matter levels are similar. Although it is early in the harvest and packing program, completed lines have confirmed this trend, as outlined below.

With compromised vine health due to the ongoing effects of Gabrielle, the season has been challenging for some in Gisborne and Hawkes Bay. This has meant managing crop levels to “nurse” vines through to the harvest period and protecting future production capacity. Below is a summary of fruit size and dry matter levels of Gisborne Gold lines harvested and packed in the year to date:

We are approximately 94% through our Red harvest. Of the 10 hectares completed, we are running 3% lower than estimate, with an average count size of 40.1 and an average pack out of 92%.

It’s been a good start to the season for Trevelyan’s with an increased volume of Kiwistart product in Gold and a pleasing Red 19 result to date.

Daniel Birnie
Head of Avocado

What will our industry look like in five years’ time?

It is now the end of March, and we have a decent southerly wind blowing; it feels like the seasons are changing. Hopefully, it signals a change in fortune for our avocado growers, too.

Recently, Steve and I went up North and visited a number of growers, packers and marketers to understand their views on the future of our industry. We met with Ross Mutton, a grower on Hukatere Road, Tom Clark and Brett Jeeves, owners of packhouses in the Far North and Whangarei, and  Jared Redwood and Blair Morris, who are involved with packing and the marketing of three  large, new developments. Additionally, we met a few others along the way.

Everyone agreed. In the recent past, after years of strong returns, large players entered the industry and planted significant orchards. As supply increased our largest market Australia also had strong volumes domestically. This situation, coupled with a challenging environment in Asia (shipping issues, competition from South American supply) meant that returns have been barely above the cost of production.

When we asked what the future holds, we had a diversity of answers. Some growers felt that the large orchards will struggle, as they have high overheads, and some were planted in marginal land, plus getting experienced  staff into remote areas will always prove to be  challenging.

However, others felt that the large orchards would survive the current environment and would have significant volumes over the next few years.

So, on arrival back into the Bay of Plenty, I sat on the tractor mowing my own orchard, and I felt I had more questions than answers: what will our industry look like in five years’ time?

My general feeling is that there will be some rationalization. Some growers will exit the industry, and alternative land use options will be considered. However, here in the Bay I think we have a good chance of weathering this challenging time, as we have;

• great soils and a maritime climate,
• access to competent staff and contractors, and,
• excellent supply chain options (think packhouses and the Port).

We look forward to discussing this further at our upcoming grower meeting on Thursday, April 11th, at Papamoa Surf Club.

Picture of Steve Butler (GM) and Blair Morris, an NZ Avocado Board member, Chair of the NZ Avocado Collective, and GM of Southern Paprika, a large capsicum grower and who also operate an avocado export packhouse.

Bex Astwood
Organic Category Manager

Harvest update and more

Welcome to the first quarterly newsletter, where we are full speed into harvest. So, what have we got in store?

Industry-wide, GAOB (Organic Gold) is estimated at 3.7 million trays, which works out to approximately 10,400 trays/hectare compared to the 2.3 million trays or 7,715 trays/hectare for 2023. HWOB (Organic Green) is estimated at 3.5 million trays, working out to 7,203 trays/hectare compared to 2.0 million trays or 4,476 trays/hectare in 2023. This year at Trevelyan’s, we have 1.6 million trays and an average of 12,180 trays/hectare for GAOB and 461,500 trays of HWOB at an average of 7,352 trays/hectare. The 2024 OGR Guidance from Dan Mathieson has GAOB at $12-$14 per tray and $130,000 – $151,000 per ha, and HWOB at $9.50-$11.50 per tray and $67,000-$81,000 per ha.

As of March 25th, the industry has submitted 473,732 trays of GAOB, which is equal to 39% of the FPP demand cap (1.2mil trays). This is well ahead of this time last year, when only 13,718 trays of GAOB had been submitted.

Speaking with Tracey Armstrong, Zespri’s Organics Product Manager, we agree that it is an exciting time for the organics category, with expected growth of +10% CAGR (the mean annual growth rate) between 2024 – 2029. To deliver on this expected growth, we need to ensure ongoing market access, especially in the high-paying markets of Japan, Korea and Taiwan. We can do this by staying on top of scale and other pests. Remember that for the 2024 season there is a load-out premium for all organic fruit that meets market and taste requirements for Japan and Taiwan.

The March 2024 Kiwiflier featured an article called ‘USDA Strengthening Organic Enforcement: Changes to Come into Effect 19 March 2024’. This gives an update on what needs to be updated in your Biogro licensee portal to meet the new requirements, including a Fraud Protection Plan. You will need to list all transporters that you use in your Organic Management Plan and have a signed transporter declaration on file. We are working with our transport providers, and I will provide you with a copy of this for the trucking company that you use.

An update from COKA: we were intending to have our AGM on Thursday 21st March, however due to the low number of attendees, we have deferred this meeting to June. A reminder that your input and contributions are important to COKA, and we hope to see many of you there in June.

All the best with harvest, and no doubt I’ll be in touch soon!

Debbie Robinson
Head of Supply

Trevelyan Growers Ltd (TGL) – what is it and what does it do?

Put simply TGL looks after: The supply of fruit to Zespri Grower payments and forecasting Service provider payments Industry representation

The industry structure was changed in 2000 which resulted in post-harvest operators and their growers needing to set up new legal entities to become Registered Suppliers to supply of kiwifruit to Zespri.

Many post-harvest facilities set up shell companies as their Registered Supplier.  They also set up Supply Entities for their grower groups to agree on pool rules, to make decisions on grower equity issues, and to discuss industry matters.

Trevelyan’s decided to establish TGL as a single legal entity, to act as both the Registered Supplier and Grower Entity and for it to be grower weighted. TGL is governed by nine elected grower directors and three appointed Trevelyan Pack and Cool Ltd (TPCL) directors.

TGL receives all funds and pays for services provided as per the terms of annual agreements. An overview of these terms is listed below:

• As a registered supplier of kiwifruit to Zespri, TGL is contracted to supply kiwifruit to Zespri and must meet the terms in the annual Zespri Supply Agreement.
• TGL provides financial forecasts, indicative cashflows, grower payments and numerous administrative duties, as detailed in the Grower and Registered Supplier Agreement.
• TGL contracts TPCL to provide coolstorage services to TGL via a Coolstorage Agreement. Services include cool storage condition checking, repacking, and loading out fruit as required to meet TGL’s obligations to Zespri and Growers.
• TGL contracts TKL Logistics Limited for the provision of logistics services (delivery of fruit to the Port),
• TGL contracts TPCL to provide various management and administrative services via an annual agreement.
• Note: TPCL contracts directly with Growers to pick, transport and pack the Growers fruit per the Trevelyan Packing Agreement.

The TGL structure has endured the test of time.  A genuine partnership between TPCL and growers via the TGL Board, has resulted in cooperation to advance all mutual interests, whilst being well respected within the industry.

Gordon Skipage
Head of Technical

The true cost of compliance

Compliance is an ever increasingly difficult and complex area of horticulture that affects us all. Customers, consumers, regulators, and communities are increasingly concerned about how and where food is grown. While GlobalGAP typically underpins a growers’ compliance requirement, there is an increased focus on Integrated Pest Management (IPM), otherwise known as AvoGreen or KiwiGreen. While New Zealand horticulture has been adhering to IPM for decades, it seems that many of our export countries are just catching up.

A decade or so ago China relied heavily on New Zealand’s systems to regulate food safety. Over the past five years, however, China has become extremely vigilant around compliance, setting their own standards and demanding some of the strictest requirements of any country we export to. Failure to meet these requirements by a single grower has the potential to derail the industry for all, as some of our more common pests (i.e., leafroller caterpillar) are serious quarantine pests for China. While a known failure to adhere to IPM automatically excludes your crop from China, the consequence of an unwanted pest found on your fruit in the market could be significant. Such finds may exclude any fruit packed at Trevelyan’s (or your packhouse of choice) being exported there. As an industry, if we get it wrong too often (and they have little tolerance for “getting it wrong”), we may lose the ability to export to China. And they are not alone – MPI recently advised Zespri that due to an increase in pest interceptions at the Australian border in 2023, the Australia Department of Agriculture, Fisheries & Forestry (DAFF) have requested to audit New Zealand’s kiwifruit export systems and processes for fruit to Australia.

Compliance, however, goes further than GlobalGAP and IPM. Just this week we’ve had two examples of non-compliance actions made by kiwifruit growers.

One grower decided to harvest too soon after rain and supplied wet fruit to the packhouse. As such, the packed fruit did not meet Zespri’s strict fruit label compliance requirements (fruit labels don’t stick to wet Gold3 kiwifruit). The pack-run therefore, had to be reworked to ensure compliance was met. This required every fruit to be checked for a fruit label – an extremely time consuming and costly exercise.

In the second scenario, an organic grower applied a foliar fertiliser (Acadian seaweed) that was not listed in the Zespri Allowed Other Compound list (as it doesn’t have organic certification in Japan). Failure to adhere to the Zespri standard has meant that this fruit, packed into an organic box carrying a logo for a certification body, now, does not meet their requirements. Each packed box, therefore, had to have a required sticker applied over the logo on the outside of each and every box – another time consuming and costly exercise.

While the cost of resolving such issues is absorbed by the packhouse, ultimately, these costs are passed on to the grower – and are easily avoidable if growers consider the repercussions of their actions.

As growers and business owners it’s important to understand the fundamentals of what is required and what makes a good grower. At Trevelyan’s we’re fortunate to have a team of experts who are available to assist and educate. Always feel free to pick up the phone and contact us – we’re only too happy to help.

Sarah Lei
Head of Sustainability

The benefits of setting targets

At the start of 2023, Trevelyan’s worked with ASB and Deloitte to develop four Sustainable Finance Targets for the next three years. These can be seen in the table below. Our performance against these targets is reviewed annually, and if we meet the targets, we get a discount on the amount of interest we pay on our loans.

At the start of 2024, we were required to assess our performance against these targets and have this reviewed by Deloitte before it was submitted to ASB. We were pleased to report that we had achieved all four of our targets for 2023. Not only does achieving our targets provide financial benefit to Trevelyan’s, but it is also worthwhile to consider the wider benefits that arise from target-setting itself.

1. Targets give accountability
   SMART is a widely used acronym that defines the criteria for good target-setting practice. It stands for Specific, Measurable, Attainable, Relevant and Timely. Because we follow international sustainable finance guidelines, our targets must meet all these criteria. When reporting on our progress, these criteria also help keep us accountable and provide confidence in the results.

2. Targets provide a sense of personal contribution
   Everyone at Trevelyan’s makes daily decisions that impact our ability to meet our targets, such as which bin to put their waste in or whether to reuse their hairnet. At the beginning of 2023, we introduced a new weekly tracking and reporting system to share progress across our organisation so that everyone could see the impact of their efforts to help reach our targets.

3. Targets help maintain motivation, especially during setbacks

   With a lower volume of fruit to pack last year, our intensity-based emissions target became more challenging. A refrigerant leak early in the season meant we had to be hyper-vigilant throughout the rest of the year to achieve it.

4. Targets help broader change
   Sustainability is a very broad term that can be used in a range of different contexts. Our targets are closely aligned with our values – Work Smart, Tread Lightly and Respect our People, which means they target specific goals under those headings, but our efforts towards achieving those targets also help support our bigger goals, such as reducing resource consumption.

5. Targets provide direction and focus
   The seasonal nature of our industry means that it is easy to get caught up in the business of doing, especially at the height of the season. Our regular weekly and monthly target reporting provided the opportunity to pause and reflect on our progress and correct our course as required. We started some coolstores early in preparation for an early season, which saw our power consumption increase. When we recognised that the fruit would arrive later, we adjusted our plans to help meet our annual target.

6. Targets help define expectations
   Measuring and reporting on carbon emissions is an evolving science. Updates to the Ministry for the Environment’s (MfE) emissions factors part way through the year required a recalculation of our baseline data (2021). Delays in having our Science-based Targets (SBTs) verified required further discussions with ASB to realign our targets.

7. Targets provide an opportunity to reflect and celebrate
   While we were pleased to achieve our targets for 2023, we are keen to reflect and learn from the process. Working to a tight deadline with Deloitte and ASB early in the year when everyone was still returning from holidays provided some challenges. In 2024, we plan to undertake interim reviews to help avoid the end-of-year rush.

 “A person should set his goals as early as he can and devote all his energy and talent to getting there. With enough effort, he may achieve it. Or he may find something that is even more rewarding. But in the end, no matter what the outcome, he will know he has been alive.” —Walt Disney.

Colin Olesen
TGL Chair

A Plan ‘A’, a Plan ‘B’ and a Plan ‘C’ is better than no plan at all

Your Directors recent meeting examined the detailed planning for the current harvest and discussed future years’ possibilities and potentials. We are a dynamic industry experiencing significant growth because kiwifruit is such a positive and sort after food.

Industry decision making was also discussed. Changes will need to be made to the present ‘norm’ sometime in the future. It is better to address these now, rather than when a significant challenge presents itself.

The February forecasts again displayed a positive return to growers when compared to Industry wide figures – a reflection of the good work on the orchard by our growers, and then the excellent care of our fruit taken by the packhouse.

The Trevelyan (TPCL) Packing Agreement has been sent to all Trevelyan growers with the Trevelyan (TGL) Supply Agreement shortly to be finalised; hopefully in your hands for signing by the time you read this page. Please attend to signing both agreements promptly, as this will assist the Kiwifruit Grower Services Team in their work.

I wish you all a safe and high-quality harvest.

Ashby Whitehead
TAGL Chair

My thoughts

Trevelyan’s Avocado Growers Limited (TAGL) was established twelve months ago, morphing from a grower committee to a board of directors. This was to give growers a voice at the Trevelyan’s table. The board consists of nine directors and Trevelyan’s representatives.

Topics of discussion include but are not limited to;

• input into the Avoco grower group,
• local market updates from Zara Marra,
• fruit quality issues and,
• harvesting strategies.

TAGL and Trevelyan’s Pack & Cool Ltd is in the process of purchasing Bayfarms and will form a fifty-fifty partnership of the BayFarms local market brand. Growers supplying Trevelyan’s with either export or local market fruit can feel proud to be part of the BayFarms brand established by Ron Bailey and Alister Hawkey in 1995. As chairman, I would like to foster the relationship between the growers and Trevelyan’s, creating an improved working relationship with our exporters.

As an industry, we are all feeling the pain of an oversupplied market, both local and export. It is not only the growers facing tough financial times but other industries like the packing facilities, exporters, and contractors; all are feeling the pinch, with some, unfortunately, exiting the industry due to low returns.

Fruit quality is a major issue that we face. Approximately two million dollars was associated with the cost of repacking export fruit in Australia, because of quality issues.  Some of the quality issues arise at the orchard level and those growers not following best practice procedures; including applying a minimum number of coppers in a timely manner, harvesting after a rain event, monitoring, and spraying when required, and if the threshold has been exceeded. Quality issues may arise in the packing and storage of the fruit and furthermore, shipping times can greatly affect fruit quality.

Crop estimation is an area we could quickly improve on. It is vitally important to give our exporters and packhouses accurate numbers, so they can plan for their coming season.

I encourage any growers that have any issues they would like to discuss to contact one of your grower directors.

Developing a more environmentally friendly fleet

A Trevelyan’s Improvement Group recently assessed how we could reduce emissions from our company vehicles, including driving less or adopting hybrid, fully electric or hydrogen vehicles.

The leases for several vehicles on our fleet were due to expire at the end of 2023, and this provided a real opportunity for change.

After collecting and analysing the data on where fuel was being used, surveying those who drove our vehicles and test-driving a range of vehicles, we decided to include four Skoda Enyaq electric vehicles (one still to come in the photo below) into our fleet. We are committed to continuing to collect and analyse the data to understand the social, environmental and financial impacts of this change – small steps can yield BIG results!