The connections between Central Otago and China extend back over a century to the gold mining heydays and today those links have become even firmer, this time thanks to a small juicy fruit bringing a gold rush all of its own.
The New Zealand cherry industry is a minnow internationally, producing just over 5,000 tonne last year off only 650ha, a volume that pales against the United States’ massive 110,000t annual crop. Of New Zealand’s total production over 90% of exported cherries are grown in the Central Otago region as areas like Marlborough have moved into apple and vineyard production.
“Of New Zealand’s total production over 90% of exported cherries are grown in the Central Otago region as areas like Marlborough have moved into apple and vineyard production.”
In recent years the profile of this high quality niche fruit has grown as an increasing number of Asian consumers have been introduced to its taste sensation.
A high level of local expertise and efforts to market it in the premium fruit sector are paying off as Otago cherries build on their reputation as being among the world’s best.
Summerfruit NZ chief executive Marie Dawkins said the Central Otago region has cemented its reputation for premium grade fruit, thanks in part to its dry climate, cold winters and soils proving well suited to a range of cherry varieties.
“And as a marketed crop they have a novelty element to them – they are only available for a certain length of time during the year, making them particularly sought after when they do come onto the shelves. We are very much being drawn by market pull demand at present.”
The 2016-17 season had the cherry industry achieve some new records, including a 5,000t harvest that earned the industry $88 million, of which two thirds came through export sales, largely to China and Taiwan.
“The 2016-17 season had the cherry industry achieve some new records, including a 5,000t harvest that earned the industry $88 million.
This season is proving a particularly fruitful one for all stone fruit thanks to some record breaking hot ripening weather pushing maturity dates at least two weeks ahead of where they would normally be.
Bayleys Cromwell real estate agent Gary Kirk has had close contact with cherry orchardists and investors looking to expand their operations. He works alongside Doug Macgillivray and the two agents report healthy interest in the sector.
In an industry where intergenerational family ownership is common, they have noticed increased interest from larger scale fruit growing investment companies and operators in the past 18 months.
“We have seen a large Hawke’s Bay company making a substantial investment in the Roxburgh district developing a 200ha cherry orchard on the side of Lake Dunstan.
“Another operator has established a 1,000t capacity pack house at Bannockburn, and another at Pisa Moorings, both just commissioned. All up we would be looking at about 350ha of cherries going into the ground in the coming seasons,” says Gary.
With their short shelf life a quick turnaround between picking, packing and air freighting shelf ready for retail is vital for growers to maintain their reputation as top end premium suppliers to increasingly discerning consumers.
“This has been a vital part of our success, keeping that reputation for quality. Chilean growers have higher volumes, but tend to containerise their cherries, which lowers their value from the start,” says Marie Dawkins.
Gary Kirk cautions while market prospects for the small red fruit are positive, getting root stock to start an orchard can prove a challenge, with supplies so tight investors can expect a two year wait for trees, before they even get them in the ground.
“Add in the time it takes to start producing, and you could be looking at up to seven years before you are seeing a real return on your $200,000 a hectare set up cost, so you do need to be prepared to be in it for the long haul.”
And despite their appealing returns there is a high level of risk in a crop that can be wiped out by hail or rain in a single weather event.
Gary and Doug have witnessed local orchardists removing apricots to make way for cherries, and the accepted district boundaries for growing them spreading as new varieties become available.
“Typically you would look at an economic investment block being around the 40-50ha size, with land being sold for $25,000-$40,000 a hectare.”
The agents predict the biggest challenge for the industry will be finding places for the additional 500-600 people needed to pick the high value crop in coming years.
“Accommodation is a real challenge even for the locals here, and will need to be addressed,” says Doug.
Overall however the industry has responded well as a small sector that is punching well above its weight globally to deliver consistent quality and high value produce to discerning consumers.