Financial Factors
Revenue
Asparagus
Prices for process asparagus have continued to increase, rising about 10% from the previous season to between $2.25/kg and $2.40/kg. Average local market prices were generally similar to process prices. Process prices are expected to fall slightly for the coming season.
Depending on the exporter, prices for export asparagus rose from $2.50/kg to between $3.00/kg and $4.45/kg. Prices are expected to remain at similar levels for the coming season.
Prices for organic asparagus were $3.00/kg for process, $3.50/kg for local market, and $2.50/kg for export.
Carrots
Organic carrots achieved $1.25/kg for export grade and $1.10/kg on the local market. The improvement in the New Zealand dollar against the Australian helped in these returns.
Sweetcorn
Average prices for corn remained stable at $128/tonne for Jubilee and $150/tonne for Supersweet. Some processors operated a bonus system to reward good quality corn. Prices for organic corn were $200/tonne for fully certified corn and $122/tonne for conversion.
Peas
Prices for peas again remained stable, ranging from $260-$280/tonne.
Potatoes
Prices for potatoes for the export and local market have dropped dramatically due to oversupply in New Zealand. Increase in yields and area grown has meant production is well above that needed to satisfy demand. Local market prices dropped below cost, with growers struggling to get $1.50 for a 10 kg bag. Export prices were also struggling at around $80/tonne. Prices for process potatoes dropped about 5% to around $175/tonne.
Organic potatoes achieved 50ÿc/kg on the local market and 21ÿc/kg for processing.
Squash
In Gisborne returns for squash were disappointing. Prices between 35ÿc/kg and 45ÿc/kg operated for most of the season. With many crops only yielding 50% of normal, at around 7ÿtonnes/ha, growers barely covered costs or lost money. Prices did improve at the end of the season.
In Hawke's Bay the squash price started weak, improved mid-season, and tapered off again at the end of the season. Average prices were around 10% higher than last year, bringing them to around 50ÿc/kg. The improvement mid-season was caused by a shipping shortage which resulted in a stockpile here and tightened market supply, driving prices up.
Organically grown squash was exported as conventional squash and received 65ÿc/kg. Growers were offered contracts which gave a minimum price of 40ÿc/kg and maximum of 80ÿc/kg.
Tomatoes
The price for tomatoes remained stable at about $97/tonne. Growers were offered one-year contracts.
Expenditure
Exchange rates have increased costs for potato growers as most inputs are imported. With the cost of diesel continuing to rise, and the price of machinery and other inputs expected to rise, growers are generally pessimistic about the future of the industry.
Net Result
Asparagus
The 15 year average gross margin, including set-up costs for asparagus, is $5,850/ha. Once asparagus is in full production the average gross margin is $11,000/ha.
Sweetcorn
The gross margin for sweetcorn based on a yield of 20 tonnes/ha, is $2,445/ha.
Peas
At the current price and at an average of 5ÿtonnes/ha, the average gross margin is $625/ha.
The pea industry remains stable, although a gradual increase is expected in both peas and corn in the next 12 months. There is a further increase in the use of irrigation in peas and sweetcorn.
Squash
After the second year in which returns for squash were marginal, some growers are looking to grow less squash in the future. This was already reflected in the plantings this last season which were 10% down on the area planted in the 1997/98 season. Other crop options have included onions and seed maize.
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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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