Kiwifruit industry to create 29,000 new jobs by 2030, add $3.5B to annual GDP, new report says
By Jonathan Underhill
June 27 (BusinessDesk) - The kiwifruit industry will generate 29,000 new jobs and add an annual $3.5 billion to NewZealand's gross domestic product by 2030, with much of the growth driven by new cultivars such as Gold 3, according to a Waikato University report for Zespri International.
The nation's statutory kiwifruit exporter commissioned the report to look at the economic contribution of the industry to the Bay of Plenty, Northland and New Zealand as a whole. The report finds that both the Bay of Plenty, which has the lion's share of the industry, and Northland will enjoy a similar impetus to regional GDP - 135 percent between 2016 and 2030, with the contribution to Bay of Plenty GDP rising to $2.04 billion from $867 million and Northland's to $72 million from $30.6 million.
The report is based on Zespri production forecasts by variety out to 2030 and uses a '106-sector economic model' developed by Professor Warren Hughes to assess the input and output gains across the whole economy.
While it was completed in January it is being released after the publication this month of the latest Situation and Outlook for Primary Industries report from the Ministry for Primary Industries, which forecast out to 2021 and had the value of kiwifruit exports surging to $2.1 billion from $1.5 billion in 2016. That forecast growth is almost entirely based on gold kiwifruit, with exports jumping to $1.3 billion from $524 million, while exports of green fruit actually fall by 2021 to $810 million from $917 million.
The Waikato University study estimates annual growth in production of kiwifruit over the 14 years to 2030 of 5.4 percent for the entire crop but growth of individual varieties ranged from 1.7 percent to 11.7 percent a year.
"New varieties have proven critical to the economic viability of the industry and its ongoing contributions to the economy," the report says. "For instance, if Gold 3 had not been available and rolled out following PSA and there had been no replacement available it is estimated the industry in 2030 would have been approximately 46 percent of our projections for 2030."
"Industry profits would be even lower given the proportion of industry fixed costs having to be spread over a small volume of production, and as a result, gold growers would have had fewer opportunities to recover their accumulated debts associated with PSA," the report says. "The availability of Gold 3 led to less exits from the industry, fewer personal, community and social crises. Gold 3 provided a platform for sustained regional employment. Further, in the absence of a productive gold cultivar there would have been the temptation for growers to over produce green kiwifruit and stricter crop management protocols would have been required."