6.1.1      Kiwifruit industry profile

The kiwifruit industry is the biggest sector in New Zealand's horticultural industry. Today, 2,792 kiwifruit growers produce approximately 150 million trays for export from 12,905 productive hectares. In 2019/20 this was worth $2.967 billion in gross sales, which was 4.5% up on 2018/19.

The Bay of Plenty is the focus of kiwifruit growing (principally Katikati, Te Puke, Tauranga, Opotiki and Whakatane), producing over 80% of the crop.

The New Zealand kiwifruit industry continues to recover from the devastating effects of a bacterial canker disease specific to kiwifruit, Pseudomonas syringae pv. actinidiae (termed Psa). Psa was detected in New Zealand in November 2010, and rapidly caused widespread and severe impacts to New Zealand's kiwifruit industry. It is now well managed year-round through monitoring, canopy management, spray protectant use, hygiene and movement controls. Psa is also present in other countries including Italy, Japan, South Korea, Chile and, most recently, Australia. There is no current cure for the disease.

The New Zealand kiwifruit industry’s ‘Hayward’ variety (‘green’ kiwifruit) is relatively tolerant to the disease, and new varieties are being developed.

Gold cultivar. There are 5,483 productive hectares of the gold kiwifruit cultivar, commonly known as Gold3 or SunGold, licensed in New Zealand. These produced 72.8 million trays in 2019/20. The cultivar was fast-tracked to commercial launch in response to the identification of Psa in 2010, and is a cornerstone in the Psa recovery pathway and the major driver of the kiwifruit industry’s expansion. SunGold’s market performance has been very strong, and as a result Zespri released an additional 400 hectares of licence in 2016, 400 hectares in 2017 and 750 hectares in 2018, 2019 and 2020.

Red cultivar. In 2020, 150 hectares of licences for the red cultivar Red19 were released to New Zealand growers. The new cultivar is subject to provisional plant variety rights (PVR) protection in New Zealand and elsewhere in the world. Based on the current expected market demand of 15 million trays in Asia during the current supply window for Red19, Zespri plans to license 1,500 hectares between 2020 and 2023.

Table 6.1.1: Kiwifruit industry statistics

Season (to 31 March)	2011	2012	2013	2014	2015	2016	2017	2018	2018-19	2019-20
Trays submitted (million)	105.9	119.5	105.7	97.69	97.8	123.4	148.9	125.8	157.7	150
Trays sold (million)	98.1	109.1	101.3	95.1	95.2	117.0	137.7	123.2	148.8	145.2
Yield (trays/ha)	8,255	9,556	8,621	8,684	8,076	10,157	11,838	9,913	12,373	11,650
Planting (ha)	12,825	12,500	12263	11,250	11,233	12,185	12,578	12,692	12,747	12,905
Growers	2,706	2,662	2636	2,556	2,540	2,516	2,435	2,405	2,756	2,792
Pack-houses	67	63	59	54	50	51	50	47	44	44
Coolstores	83	79	76	68	62	64	73	67	64	63

 

Kiwifruit Vine Health (KVH). KVH is the industry-funded entity that leads New Zealand’s recovery in Psa-affected regions. This includes a comprehensive research and development programme involving researchers from New Zealand and around the world, working to develop strategies to combat the disease. KVH is also tasked with leading wider biosecurity for the kiwifruit industry. Its vision is 'a biosecurity resilient kiwifruit industry'. The key focus areas in support of this vision are: advocacy, promoting best practice biosecurity to growers, providing technical advice, removing wild kiwifruit and abandoned orchards, profiling new and emerging risks, managing industry preparedness and response, and ensuring innovation in biosecurity management.

Zespri. As a result of the Kiwifruit Industry Restructuring Act 1999, Zespri Group Ltd is a single-desk exporter of kiwifruit to countries other than Australia. Zespri Group Ltd (Chief Executive Dan Mathieson, www.Zespri.com) is a private company owned by current and past New Zealand kiwifruit growers, employing around 600 people.

Kiwifruit to Australia Product Group. Kiwifruit exported to Australia are a prescribed product under the New Zealand Horticulture Export Authority Act (see page 11). NZ Kiwifruit to Australia Product Group Manager is Neil McLoughlin. The nine HEA-licensed exporters to Australia are represented by Kiwifruit Exporters to Australia (KETA).

Kiwifruit New Zealand (KNZ). KNZ is the industry regulator charged with applying the Kiwifruit Export Regulations 1999. Kiwifruit can be exported to countries other than Australia in collaboration with Zespri, by applying to KNZ for a collaborative marketing programme. In 2019/20, 17 companies operated 21 collaborative marketing sales programmes with Zespri, exporting just over 2.9 million trays of kiwifruit from New Zealand to markets other than Australia.

New Zealand Kiwifruit Growers Inc. (NZKGI). The interests of growers are represented by NZKGI. NZKGI’s vision is ’innovative leadership — succeeding through change’. Its mission is to advocate, protect and enhance the commercial and political interests of New Zealand kiwifruit growers. NZKGI activities are led through strategic objectives in the areas of communication, labour and education, external relations, industry stability, performance and organisational management.

 

Kiwiberry industry profile

The kiwiberry (Actinidia arguta) is a species within the genus Actinidia (which kiwifruit belongs to). The main plantings are in the Bay of Plenty, with smaller plantings in Canterbury, Nelson and Auckland. Harvesting of kiwiberries occurs from late February to mid-April. In 2020, total production increased to 260 tonnes from 35 hectares of vines.

Exports of kiwiberries are regulated under the Kiwifruit Export Regulations, and by the Horticulture Export Authority for exports to Australia. New Zealand KiwiBerry Growers is the industry body representing the interests of kiwiberry growers, and is a product group affiliated to Horticulture New Zealand.

 

Exports

Kiwifruit. Kiwifruit continues to be New Zealand’s largest single horticultural export by volume and value. Exports exceeded $2.5 billion in 2020, representing a 36% increase in value from 2018, while volumes have only increased 15% during this period. Kiwifruit continues to achieve increased returns per tonne exported. In 2018 this was $3,661/tonne, and increased to $3,989/tonne in 2020.

Much of the growth is from a 69% increase in the value of exports to Japan to $670 million in 2020. Japan has replaced the European Union as the number one export market. This is the first time since 2012 that Japan has been the most valuable market for kiwifruit. The EU and China have increased in value by 25% and 24% respectively. These top three markets take 74% of exports. The top ten countries have all shown an increase in export value from 2018 to 2020, and together are 95% of the total export value. Vietnam has shown strong growth increasing by 86%.

New Zealand kiwifruit and kiwiberry is exported under four HS Codes (see Appendix 1):

• 0810.50.00.10: kiwifruit, gold fleshed, fresh
• 0810.50.00.19: kiwifruit, green fleshed, fresh
• 0810.50.00.29: kiwifruit, other than gold or green fleshed, fresh
• 0810.90.00.55: kiwiberry

Table 6.1.2: Kiwifruit (0810.50.00) export markets 2018-2020 (year ending June, tonnes and $NZ FOB)

Market	2018		2019		2020
	Volume	Value	Volume	Value	Volume	Value
Japan	96,122	396,703,399	130,550	589,525,865	125,521	670,496,781
European Union	204,370	511,287,055	214,749	563,577,341	225,330	637,190,640
China	101,457	457,159,330	107,558	510,135,168	112,905	564,743,221
Taiwan	35,360	137,711,850	35,155	142,374,074	33,289	146,859,006
South Korea	28,196	91,591,502	33,829	149,757,277	38,664	126,798,972
United States of America	22,119	65,637,899	30,126	91,658,643	29,100	120,010,975
Australia	16,043	42,383,802	17,600	50,953,429	17,534	54,393,858
Hong Kong	6,559	29,129,510	7,365	36,081,746	7,669	40,774,245
Singapore	3,033	15,517,921	3,596	20,681,602	3,979	25,131,106
Canada	4,959	14,196,861	7,554	22,829,949	7,109	24,695,963
Vietnam	3,240	12,651,264	4,335	19,062,835	4,848	22,848,691
India	7,380	16,139,068	9,715	19,114,020	5,924	16,739,071
Malaysia	2,965	10,543,035	3,638	14,205,970	3,273	13,899,653
Thailand	2,267	7,209,883	2,662	9,492,848	2,883	10,902,358
Indonesia	2,691	9,943,090	2,740	10,812,887	2,502	10,757,762
Saudi Arabia	1,186	3,792,932	1,510	5,410,379	1,877	7,261,748
United Arab Emirates	1,969	6,487,963	1,729	6,225,235	1,901	7,211,374
Brazil	2,974	7,555,171	4,050	10,819,082	2,147	6,025,868
Philippines	1,078	2,904,294	1,285	3,988,853	1,369	4,332,890
Israel	891	2,774,632	971	2,999,780	1,278	4,211,594
Russia	742	1,937,696	922	2,640,286	1,114	3,665,054
South Africa	1,576	3,131,751	1,534	3,371,987	1,393	3,442,534
Mexico	1,848	4,689,192	2,680	7,250,954	987	3,183,023
Reunion	329	907,798	385	1,119,626	515	1,629,052
Kuwait	592	2,004,743	673	2,455,739	365	1,400,713
Mauritius	378	1,041,009	498	1,511,965	431	1,367,735
Bahrain	284	949,083	248	878,504	310	1,187,682
New Caledonia	302	764,022	276	789,260	289	856,128
French Polynesia	199	707,525	214	803,044	186	679,828
Fiji	69	198,693	86	210,611	67	181,991
Guatemala	68	178,814	94	284,716	77	178,700
Myanmar	64	220,364	75	275,990	46	168,165
Costa Rica	158	416,828	115	338,538	53	133,194
El Salvador	77	188,569	90	231,055	46	94,921
Pacific Islands	22	69,948	20	70,294	24	90,212
Cambodia	0	0	0	0	11	58,888
Papua New Guinea	1	3,232	2	6,582	1	3,117
Argentina	98	229,348	118	309,535	0	0
Qatar	0	0	22	74,694	0	0
Total	551,666	$1,858,959,076	628,769	$2,302,330,363	635,017	$2,533,606,713
% change (Yr/Yr)	0%	12%	14%	24%	1%	10%

 

Kiwiberry. Exports of kiwiberry have remained relatively stable, increasing 15% to $4.9 million in 2020. The two main export destinations are Taiwan and Australia. Volumes appear to fluctuate year on year for both markets.

Table 6.1.3: Kiwiberry (0810.90.00.55) export markets 2018-2020 (year ending June, tonnes and $NZ FOB)

Market	2018		2019		2020
	Volume	Value	Volume	Value	Volume	Value
Taiwan	59	835,526	43	701,524	85	1,404,656
Australia	116	1,627,279	106	1,219,579	91	1,334,297
Japan	26	405,011	42	672,017	42	765,859
United States of America	53	651,030	41	494,186	63	720,697
Hong Kong	28	355,214	16	257,339	21	306,951
Singapore	8	104,740	1	20,522	7	109,086
Thailand	4	57,922	4	66,107	4	54,762
Vietnam	0	0	0	0	3	50,757
Malaysia	4	56,574	2	33,425	3	40,178
European Union	2	35,151	2	31,508	2	34,102
United Arab Emirates	1	16,418	0	0	1	19,493
Indonesia	1	16,555	1	10,720	1	17,888
Philippines	0	0	0	0	1	9,780
French Polynesia	0.1	953	0	0	0	1,408
India	3	49,055	0	0	0	0
Canada	1	14,505	0	0	0	0
Total	305	$4,225,933	258	$3,506,927	323	$4,869,914
% change (Yr/Yr)	14%	9%	-15%	-17%	25%	39%

 

Barriers to export

Cost of tariffs

Kiwifruit. There are no tariffs on kiwifruit to most markets, with two key exceptions, the EU and India. The EU tariff of 8 to 8.8% is one of the higher single tariffs for exports to the EU, totalling $51.3 million in 2020 and accounting for 91% of tariffs for 25% of the FOB value. India’s 30% tariff cost $5 million on 1% of the FOB value. Under the CPTPP, the tariff into Japan has been eliminated. The tariff into South Korea was phased out in 2020 under the New Zealand-Korea FTA. Under the New Zealand-China FTA the kiwifruit tariff has been zero since 2016. FTA negotiations with India commenced in 2010 however the timeframe for completion is not clear. For the 2,792 kiwifruit growers, the $56.4 million estimated cost of tariffs equates to $20,212 per grower.

Table 6.1.4: Cost of kiwifruit tariffs (based on 2020 FOB value)

Country	Tariff rate	Value	Estimated cost of tariff ($)
Japan	0%	670,496,781	0
European Union	8-8.8%	637,190,640	51,313,929
China	0%	564,743,221	0
Taiwan	0%	146,859,006	0
South Korea	0%	126,798,972	0
United States of America	0%	120,010,975	0
Australia	0%	54,393,858	0
Hong Kong	0%	40,774,245	0
Singapore	0%	25,131,106	0
Canada	0%	24,695,963	0
Vietnam	0%	22,848,691	0
India	30%	16,739,071	5,021,721
Malaysia	0%	13,899,653	0
Thailand	0%	10,902,358	0
Indonesia	0%	10,757,762	0
United Arab Emirates	0%	7,211,374	0
Philippines	0%	4,332,890	0
Russia	0%	3,665,054	0
Mexico	0%	3,183,023	0
Kuwait	0%	1,400,713	0
New Caledonia	5%	856,128	42,806
French Polynesia	8%	679,828	54,386
Fiji	0%	181,991	0
Total	3.7%	$2,522,393,364	$56,432,844

 

Chile is a competing Southern Hemisphere supplier and has negotiated free trade agreements with 12 countries including China, South Korea, Japan, the USA, Mexico, MERCOSUR countries (Brazil, Argentina, Paraguay, and Uruguay), and the European Union. There are concerns that the trade advantage enjoyed by Chile will reduce prices in these markets and make it more difficult for New Zealand to compete. Chile also wants to double kiwifruit export to India within next 4 to 5 years.

Kiwiberry. The USA imports 15% of kiwiberries by value, however the 2.2% tariff was responsible for 81% of the overall cost of tariffs on kiwiberry exports. The EU is responsible for 15% of tariffs.

Table 6.1.5: Cost of kiwiberry tariffs (based on 2020 FOB value)

Country	Tariff rate	Value	Estimated cost of tariff ($)
Taiwan	0%	1,404,656	0
Australia	0%	1,334,297	0
Japan	0%	765,859	0
United States of America	2.2%	720,697	15,855
Hong Kong	0%	306,951	0
Singapore	0%	109,086	0
Thailand	0%	54,762	0
Vietnam	0%	50,757	0
Malaysia	0%	40,178	0
European Union	8.8%	34,102	3,001
United Arab Emirates	0%	19,493	0
Indonesia	4%	17,888	716
Philippines	0%	9,780	0
French Polynesia	8%	1,408	113
Total	0.4%	$4,869,914	$19,684

 

SPS market access barriers - kiwifruit

Kiwifruit can be exported to around 60 countries, generally with very few phytosanitary barriers.

Australia. The industry is working with MPI to investigate joining a relatively new Australian inspection regime. This would see kiwifruit included in the Compliance-Based Intervention Scheme (CBIS), which is explained in detailed in Section 7.8.3. In the meantime, all consignments must be inspected on arrival. Like many other industries kiwifruit exporters participated in the offshore pre-shipment inspection (OPI) programme which ended in mid-March 2020. The removal of OPI has raised ongoing concerns about Australia’s inability to identify pest detections down to a species level, with many kiwifruit pests not of quarantine concern to Australia at the species level (e.g. non-actionable). Also, of concern is the ongoing classification of pests as quarantine pests based on their potential to vector disease without pest risk analysis work supporting these assertions.

China. China has requested that New Zealand agree to develop an import protocol for kiwifruit and kiwiberry to China. The protocol is to bring kiwifruit, which has a long history of trade with China, in line with new import protocols that China has developed for new market access requests. The protocol will also provide renewed market access for kiwiberry (Actinidia arguta). Zespri continues to use additional pre-export checking procedures to manage the risks of the fungus Neofabraea actinidiae occurring on fruit. These additional checks were included in 2016, following the detection of N. actinidiae on exported fruit.

Colombia. A potential new market. It was clarified in May 2017 that fresh kiwifruit did not have access without a pest risk analysis being completed, so information to support a request was provided. Negotiations are continuing.

Ecuador. A potential new market. Information to support a market access request was submitted to Ecuador in 2017/18. Discussions have stalled due to unfeasible proposed conditions and reprioritisation of new markets.

European Union. A phytosanitary certificate is now needed for kiwifruit to the EU, but access is not restricted. From December 2019 the European Commission has required this additional certification for all shipments of kiwifruit to Europe. This has not caused any impact on trade.

Some EU member states still require, or have even recently begun to require, wet signatures on phytosanitary certificates, so the clearance process still remains very much paper-based. The COVID-19 pandemic has prompted some developments in electronic document exchange, and these are expected to continue.

Indonesia. Uncertain market for all fresh fruit and vegetables because of the Indonesian regulatory system. Kiwifruit is not subject to the same restrictions as other fruit and vegetable exports. However, new import licensing requirements have been introduced that may further complicate access to Indonesia. The country recognition agreement (CRA) of New Zealand expires on 26 January 2021, and formal application for renewal must occur six months prior to expiry (i.e. July 2020). New Zealand has applied for this renewal. Explanation on CRA is provided in Section 7.17.3.

Iran. Exports are not commercially viable. Requirements include compulsory fumigation with methyl bromide in New Zealand. This poses an unacceptable risk to fruit quality, due to transit times and unknown arrival conditions.

Israel. Access has been helped by a wider shipping window, though it is still restricted. Israel takes action against the rot Phomopsis sp. This is a cosmopolitan genus that can be present as a secondary rot. It is very complex and accurate species identification is difficult. As a result, several shipments of New Zealand fruit have been rejected at the border for what New Zealand regards as a rot associated with over-ripe or damaged fruit. There have been no further interceptions since 2014, however the kiwifruit industry maintains a programme of a reduced shipping window to reduce risk. Through excellent performance since the introduction of the shipping window in 2014, it was agreed to be extended starting from the 2020 season with good results to date. The shipping window however still compromises the ability to serve this market.

Japan. Unnecessary on arrival fumigation often occurs. A system of listing non-quarantine pests means that if a pest occurs in Japan but is not on that list, it is still considered to be a quarantine pest. MPI has successfully negotiated expansion of the non-quarantine pest list, but fumigation still occurs of non-quarantine pests.

Jordan. No access. A change to import permits from the 2016 season closed access to Jordan. The new requirement is for an additional declaration that the consignment is free of Pseudomonas syringae pv. syringae. Kiwifruit is a well-known host of this common bacterial blast, and Zespri has not pursued a case via MPI about this. The requirement seems to be targeted at New Zealand product as there is no such requirement for exports from Europe, where this bacterium is also present.

Kenya. Exports are possible, but no trade has occurred. MPI and the kiwifruit industry have confirmed that access is open provided original copies of the import permit and phytosanitary certificate are presented at import. No kiwifruit has yet been exported to Kenya, and there are no plans for the immediate future.

Mexico. Occasional detections of Fuller’s rose weevil result in fumigation. Fuller’s rose weevil is categorised as a quarantine pest even though records show that it is present in Mexico. Mexico has stated that the only sightings were a number of years ago, and no further sightings have occurred.

Panama. Access is now open. MPI and the kiwifruit industry worked on phytosanitary requirements for this market. While no Importing Country’s Phytosanitary Requirements (ICPR) are maintained for Panama, access is open from the 2020 season, and shipments are likely to start in season 2021.

Peru. A potential new market. A market access package was submitted to Peru in 2017/18 to support a new access request, and discussions continue.

Philippines. Access continues but is restricted. In 2019 Philippine authorities reduced the validity of import permits to only 20 days (from 60 days). This is not aligned with the industry’s supply chain order lead times and is interpreted as a technical barrier to trade.

South Korea. Regulations on residue testing upon arrival are significant. These are exacerbated by frequent MRL revisions, which mean each supplier or post-harvest operator needs to be re-tested with each change.

Thailand. A challenging market to supply. Its revised import conditions, which were implemented in October 2015, appear simple on paper but verification is difficult. In particular, they require an Integrated Fruit Production (IFP) system for controlling the actionable pests on each orchard. IFP systems are not designed to prove control measures, but Thailand requires this.

Updated labelling requirements in 2018 require pallets to be identified with shipping marks. Thailand introduced rapid residue testing requirements at the border from August 2020. All imported produce is categorised based on compliance history: very high risk, high risk or low risk. Kiwifruit is currently part of the low risk group, which means random rapid testing applies on arrival unless a certificate of analysis is presented at import. If any shipment is found to be non-compliant, the exporter/commodity combination will be re-categorised as ‘very high risk’ and future shipments will be tested for non-compliant pesticide (at the importer's cost). Shipments are generally held at the border until the test results are available.

Labelling

There are international guidelines for labelling, but South Korea, Brazil, India, Indonesia, Malaysia, Qatar, Russia, Saudi Arabia, Vietnam and Argentina all require additional labelling to be applied before export.

 

SPS market access barriers - kiwiberries

China. Access stopped. In 2016 China reviewed the list of crops permitted entry to China and added the scientific names associated with the importable commodities. Kiwiberry had previously been classed as 'kiwifruit' because of its inclusion in the Actinidia genus and had entered on this basis for several years. However, in the review China considered that Actinidia arguta was not part of the kiwifruit group so kiwiberry was excluded from the list of permitted crops. China has requested that New Zealand agree to develop an import protocol for kiwiberry and kiwifruit to China. The protocol is in line with other import protocols that China has developed for new market access requests.