Lower North Island Process and Fresh Vegetables
Lower North Island Process and Fresh Vegetables
The main vegetable crops grown in the Gisborne, Hawke’s Bay, Manawatu and Rangitikei regions are process tomatoes, process sweetcorn, fresh export squash, asparagus, process peas, potatoes and process carrots.
Key Points
- The lower North Island experienced one of the wettest springs and early summers on record.
- The wet October and December conditions delayed planting and establishment resulting in increased disease problems, and reduced yields and quality in squash, tomato, sweetcorn and potato crops.
- Asparagus production is expected to increase from 5,500 tonnes in 2001 to 8,500 tonnes by 2005, but returns for asparagus are expected to reduce.
- There is increasing competition for cropping land, especially around Gisborne.
- Minimum tillage is being recognised as having great potential to enhance sustainability of annual cropping enterprises.
Physical Factors
Climate
Gisborne
The 2001/02 growing season was one of extremes for Gisborne growers. The spring and early summer was wet and cloudy with October and December rainfall double the long-term average. Late summer produced dry, warm weather with March and April rainfall 14% and 39% of the long-term average respectively. These conditions resulted in below average sweetcorn and squash yields.
Hawke’s Bay
The 2001/02 Hawke’s Bay growing season was characterised by early dry conditions, and October, December and January rainfall was nearly three times the long-term average. Tomato planting began on 5 October and was not hindered by the weather. However, the wet growing season resulted in an increase in bacterial canker which caused root damage and stunted plant growth. Harvest conditions were extremely difficult and the wet weather during January and early February caused delays in harvesting.
Despite a slow start caused by cold spring conditions and the wet weather during October and December, growers commented that the growing season was good. The wet conditions caused some post-harvest rots which led to quality problems for both the fresh export market and processors.
Due to the rain in October, planting sweetcorn was very difficult and resulted in gaps in production. However, early growth was good because of the rain. Harvest conditions during February and March were excellent.
Peas planted during September benefited from good conditions at sowing. However, the wet conditions from the end of November to mid January caused yields to taper off towards the end of the harvest period.
The wet spring conditions also caused problems for the planting of squash with reports of some paddocks being flooded. Harvest conditions from January to April were excellent but quality was mixed because of the earlier weather conditions.
The wet conditions also resulted in extensive late season blight in potatoes in central Hawke’s Bay.
Manawatu
The Manawatu also experienced a wet spring/early summer with the October and December rainfall 50% above average. Below average temperatures were recorded in this period.
These conditions resulted in increased disease problems for potato growers with lower yields and quality in potato crops.
Pea growers also experienced significant disease problems which caused root damage. There were also significant weed problems, resulting in below average yields and quality.
Conversely, asparagus growers found early growing conditions ideal. The season started two weeks early and two-thirds of the season’s crop was produced in September and October. The cooler, wet conditions during November and December reduced yields.
Manawatu carrot growers were the least affected by one of the wettest planting and growing seasons on record. Wet conditions made access to paddocks difficult for controlling pests and diseases, and resulted in compaction problems. However, irrigation requirements were reduced significantly.
Source: NIWA (Readings taken at airports in Gisborne, Napier and Palmerston North)
Production
Asparagus
Hawke’s Bay yields were 2-8 t/ha with an average of 3 t/ha for 2001, compared with an average of 3.5 t/ha in the previous two years. Quality was reported as average to very good.
Production is increasing as new plantings mature. In central Hawke’s Bay, 25 ha were planted last spring. However, no further significant new plantings are expected in the coming planting season.
Manawatu produced very good quality asparagus this season with yields above average at up to 6 t/ha.
Manawatu yields are increasing as new plantings come into production from land previously in pasture or scrub.
Waikato has seen 140 ha of new plantings in the past two years. It is not anticipated that there will be any significant new planting in the coming year. Older, less viable asparagus beds continue to be phased out. In Taranaki about 80 ha were ploughed in, to convert land back into dairying.
JWC1 is seen as a successful new variety in terms of grower plantings and timing into the market.
Carrots
About 160 ha of carrots were grown in Manawatu this year, with production averaging 60-70 t/ha. Total production was down considerably on previous years.
Thirty-five tonnes (4 ha) of organic carrots were grown in Hawke’s Bay for export to Australia. Yields were poor because of pre-Christmas rain.
Sweetcorn
In Gisborne, sweetcorn yields were significantly down averaging 7.0 t/ha compared with 16.5 t/ha last season. The key reason was the very high rainfall recorded in December and the generally cloudy weather that prevailed in the early part of the season. The slow start, increased weed competition and disease problems (northern leaf blight), all combined to reduce yields. In addition, the dry, late summer reduced the yield potential of late-planted crops.
In Hawke’s Bay, early-harvested crops had above average yields and late-harvested crops had lower than expected yields because of the late, dry summer. Yields were more variable than usual. The average yield of 17 t/ha was similar to previous seasons. Yields were 9-32 t/ha depending on variety, and quality was excellent.
Forty hectares of organic sweetcorn were grown yielding 20 t/ha. This was exported to Japan, Korea and Australia. A small amount (less than 5%) was sold on the New Zealand market.
In Manawatu, several growers grew organic sweetcorn, but the wet and cold weather resulted in very low yields with most growers not harvesting the crop.
Peas
Forteen hundred hectares of peas were planted in Hawke’s Bay, an increase of 10% over last season. Due to the wet season, yields averaged 5.0 t/ha, down from 5.8 t/ha last year.
The area planted next season is likely to increase as increasing demand from processors is already outstripping the available supply.
In Manawatu the area planted increased by 50% to 1,800 ha. Average yields were 5 t/ha, similar to Hawke’s Bay but down on last year. Fifty hectares of organic peas were grown with a total production of around 100 tonnes.
Potatoes
The area planted in potatoes in Manawatu dropped by 20% this season, from 2,220 ha to 1,754 ha. This follows a drop of 15% the previous season. The difficult growing conditions resulted in below average yields of 39 t/ha and quality was also poor. Seventy-five percent of the potatoes went to the process market, 17% to the fresh market and 8% to the export market.
Squash
In Gisborne the area planted remained at 2,880 ha, but yields were down 15-20% to an average of 10.9 t/ha due to the wet conditions, increased weed competition and increased disease pressure.
Yields for squash in Hawke’s Bay averaged 11 t/ha. Quality problems, due to disease, resulted in only 70% of the crop being exported – 95% to the Japanese market, 5% to Korea and less than 1% to the Pacific Islands and the United States. The rest of the crop was processed or went to stock food.
Tomatoes
Gisborne tomato crops were generally good. The drier conditions during the harvest months of February and March resulted in good quality and a low incidence of field rots. Ninety-one hectares of tomatoes were grown with an average yield of about 100 t/ha.
In Hawke’s Bay the wet season resulted in average fruit quality and yields were down 10% to 80 t/ha. The area in production was stable at 500 ha. Mixed maturity, rotten early set fruit and later set fruit not maturing, caused quality problems at harvest.
Onions
Twelve hectares of organic onions, yielding 25 t/ha, were grown in Hawke’s Bay. Sixty percent of these were exported to the United Kingdom.
Table 2: Production Data | ||||
|
2000/01 |
2001/02 | |||
|
Crop |
Area |
Production |
Area |
Production |
|
Gisborne: |
||||
|
Sweetcorn Squash Tomatoes |
2,000 2,875 100 |
33,000 40,000 8,000 |
1,700 2,880 62.5 |
30,000 31,680 5,000 |
|
Hawke’s Bay: |
||||
|
Asparagus Peas Sweetcorn Squash Tomatoes |
350 1,275 2,250 2,700 445 |
1,250 7,000 40,000 32,000 39,200 |
350 1,400 1,800 2,700 500 |
8,750 7,000 30,600 30,000 40,000 |
|
Manawatu/ Rangitikei: |
||||
|
Asparagus Carrots Peas Potatoes Squash |
370 N/A 1,200 2,200 1,700 |
780 17,000 6,000 90,000 20,000 |
420 160 1,800 1,580 950 |
10,500 10,000 9,000 61,300 10,900 |
|
Source: Agriculture New Zealand Ltd, New Zealand Vegetable & Potato Growers’ Federation (Inc) and New Zealand Buttercup Squash Council | ||||
Financial Factors
Revenue
Asparagus
Asparagus is processed in both Manawatu and Hawke’s Bay. The process price in 2001 was $1.90-$2.10/kg, the local market was $2.00-$2.20/kg and export was $2.40/kg.
The value of the New Zealand dollar is expected to be the only reason for any price change for asparagus next season. Export and process prices are expected to reduce over the next few years as new plantings begin to increase production and supply exceeds demand. In addition, there is increasing competition from Australian producers exporting fresh asparagus to Japan during November and December. The New Zealand tonnage is expected to increase from 5,500 tonnes in 2001 to 8,500 tonnes by 2005. Reduced prices are likely to push marginal growers out of production.
Carrots
Prices paid for carrots were similar to previous years. Organic carrots export prices were $1,300/tonne free on board (FOB).
Sweetcorn
Gisborne sweetcorn prices varied greatly depending on varieties and end use. Some processors offered incentives to reduce the amount of trash (weeds, etc.) entering the factory. Prices were $140-$165/tonne.
In Hawke’s Bay the price paid for sweetcorn was $119.00-$132.50/tonne, depending on variety. The price paid for organic sweetcorn was $220/tonne, a $20/tonne increase from last year.
Peas
Pea prices paid this season increased slightly from around $260-$280/tonne to $300/tonne. The organic pea price was around $400/tonne.
Potatoes
Prices for potatoes were from $220/tonne for export, $300/tonne for local market and $200/tonne for process crops. The process price is expected to increase in the coming season as demand is greater than supply. Growers are making very little money at current prices, particularly following on from last year’s very difficult season.
Squash
In Gisborne the average return was 55-60 c/kg. Returns increased to 70-80 c/kg as yields dropped in the latter part of the season.
Fixed price contracts offered to growers were 45-65 c/kg from the packhouse. Prices for the Japanese market varied widely at $0.45-$2.00/kg. The high prices were related to shortages later in the season. The process price for squash this year was 15 c/kg and 3-4 c/kg for stock feed.
It is expected that some growers did not make a profit from squash this year as a result of the very difficult growing season.
Tomatoes
Tomato prices were stable at around $100/tonne.
Onions
The price for export organic onions was $1,150/tonne (FOB).
Expenditure
In Hawke’s Bay, tomato production costs increased as a direct result of the wet weather. There was a 30% increase in the cost of fungicide because extra applications were required. All vegetable producers reported an increase of around 20% in fungicide use and costs.
Producers report that the cost of agrichemicals is increasing by 10-15% as new generation agrichemicals come on to the market.
Producers commented that other costs of production are increasing due to a range of reasons including:
- increased diesel and labour costs;
- increased seed cost due to the additional testing for the presence of any genetically modified material;
- additional compliance costs related to biosecurity; and
- higher transport costs.
The increasing cost of airfreight is having a negative effect on fresh market exports to Japan where exporters are experiencing difficulty competing with countries like Australia which can get its product to the market more cheaply.
Net Result
The average gross margin for asparagus is $5,850/ha for a 15-year average, including set-up costs and up to $9,000/ha for the higher-yielding blocks of Jersey Giant or GWC1.
Issues and Trends
Competition for lease land on the Poverty Bay flats is more intense than ever. The maize and the maize seed industry are now offering to pay rentals that compete very well with traditional crops such as sweetcorn and squash. Rates for annual leases are now $1,200-$1,500/ha. Some growers are offering $900/ha just over the winter months for vegetable production. Some of the larger growers have each bought 100-200 ha of additional land in the last 2-3 years to strengthen their productive base and to reduce their reliance on leased land.
Growers are very unhappy at the indication from the Gisborne District Council that rates on the Poverty Bay flats could increase by 20%. Strong submissions have been made against the proposal and growers hope that the proposed rises will be reduced when the rates are finally set in June this year.
This season of weather extremes and the intense competition for land has indicated a need for more tile drainage in Gisborne and especially the Wairoa area. Tile drainage costs are $3,000-$4,000/ha, and the process can turn so-called marginal land into “good” land which would, in turn, attract higher rentals and possibly lead to higher crop yields.
Increasing quantities of squash are being sold on the Korean market, which takes the smaller squash in the 1.0-1.2 kg range. Growers hope that this market can be further developed to reduce the reliance on the main Japanese market.
Good, flat cropping land for sale is a rare commodity these days. Bare land is selling for around $27,000/ha. In Gisborne a former dairy farm of 77 ha, with two houses, recently sold for $3 million (nearly $39,000/ha).
Gisborne organic vegetable growers had another very disappointing season. Some sweetcorn crops were so stunted and contaminated with weeds that they were not harvested. Growers spent large amounts on hand weeding, with some just breaking even and some losing money. Some growers are re-trenching and growing a smaller area while others are looking for crops such as maize which have less stringent growing specifications.
Currently the future for organics in the Gisborne region does not look bright. Industry New Zealand is trying to co-ordinate a plan to stimulate the local organic sector through additional research and support. Growers await the outcome of this initiative with interest.
The old Heinz Wattie’s Limited (Heinz) factory site in the heart of Gisborne is still bare 18 months after the buildings were demolished. However, the development of shops, apartments and a hotel is still likely to proceed as resource consents have been sought.
The asparagus industry continues to expand as new plantings come into production and replace older uneconomic blocks.
The number of small asparagus blocks is reducing and the number of growers with larger holdings is increasing. There is a goal in the industry to double the yield per hectare by improving varieties and land quality, and increasing the number of plants per hectare.
Airfreight costs to Japan are impacting on potential returns for export asparagus.
The export market for asparagus looks very difficult. Japan (the major customer) is in recession and Australia has increased its position in the Japanese market through more competitive airfreight rates. As a result, export returns to New Zealand growers are likely to decline.
For growers to get sufficient land to meet market demand for squash, sweetcorn and onions, they are growing on more marginal cropping land and reducing rotations. This is resulting in an increase in the risk of crop failure, especially in years like the one just experienced.
In Hawke’s Bay the tomato industry is static in terms of growers, area and tonnage. No organic tomato production is planned. Integrated Pest Management (IPM) has been successful, with all growers involved. The introduction of a parasitic wasp to combat the tomato fruit worm has been successful.
Heinz is continuing its “Totally GMO-free” policy internationally.
The Chinese are expected to have a big impact on the future of the export potato market. They have been exporting to New Zealand markets for three years and are selling at lower prices than New Zealand.
There is on-going research in the pea industry to find more disease resistant cultivars.
Opportunities to grow organic crops for processing are reducing. One reason is the certification compliance issues for processors. The cost and difficulty of segregation is creating a reluctance to expand organics by some processors.
There is still steady growth in organic production. However, it has slowed compared with two years ago. There is pressure from supermarkets to reduce the premiums paid to organic producers both in New Zealand and overseas.
Expansion of organic export markets is being restricted by poor government-to-government recognition of some phytosanitary issues. This results in non-tariff trade barriers, particularly to Australia.
There are still major issues in the cost of organic production, particularly in the area of weed control. However, developing new technology, such as thermal weeding, is expected to assist in this area.
Minimum tillage or strip tillage is recognised by many growers as one of the most likely areas of progress for improved sustainabilty.
Demonstration fields in Wairoa (maize), the Heretaunga Plains (sweetcorn), Otane (squash) and the Ruataniwha Plains (peas) showed minimum tillage can produce good crops and improve gross margins. However, this was not universally the case.
There is some concern in the squash industry about future Japanese market requirements regarding traceability, records and residue testing, and the likely extra costs for growers.
Growers have increasing compliance costs as they require more than one quality management accreditation system to supply different markets. They believe the reason is a lack of standardisation of quality management programmes. The cost of compliance is higher when a range of different quality management protocols is involved, e.g., GREENgro and EUREP GAP.
LandWISE Hawke’s Bay is a joint initiative involving farmers, processors, science providers and local government. It is primarily concerned with sustainable cropping, but extends to include a wider participation and audience where there is mutual benefit. The overall co-ordination has been made possible through the Sustainable Farming Fund. The Hawke’s Bay Regional Council is ensuring valuable knowledge is made freely available to all. Most activities and results are reported on the LandWISE website http://www.hbrc.govt.nz/landwise.asp?menu=15.
The AGMARDT-funded Irrigation Efficiency Enhancement project was completed. Six recommendations were made that will improve performance and profitability and minimise environmental impacts. The full report is available on-line at http://www.hbrc.govt.nz/l_lincoln.asp. On-farm assessments of three systems were also conducted using a procedure developed by the California Polytechnic. This showed that even some of the “very best” systems are less efficient than generally assumed.
Contact for Enquiries
Farm Monitoring Programme Manager
Monitoring and Evaluation
MAF Policy
PO Box 2526
Wellington
NEW ZEALAND
Phone: +64 4 894 0623
Fax: +64 4 894 0741
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