Latest news with #JasonTeBrake
NZ Herald
23-07-2025
- Business
- NZ Herald
Agribusiness and Trade: How Fonterra and Zespri are navigating US tariffs
'We're still working through it.' For the horticulture sector's biggest exporter, Zespri, growth in American consumer demand this season has been a 'pleasant surprise', says chief executive Jason Te Brake, offsetting to a degree the 10% extra tariff and prompting the global marketer to pump more fruit this year into a market it's been carefully nurturing in recent years. Photo by Jamie Troughton/Dscribe Media. Zespri CEO Jason Te Brake. Photo / Supplied In response to the higher demand, Zespri will this season deliver 13.5 million trays of New Zealand-grown fruit to the US, compared with a record 11.3m trays in the 2024-2025 season, which earned around $280 million (US sales in 2023-2024 were around $206m.) Zespri will also this season launch its recently commercialised RubyRed fruit to the US. The importer of record in the US is getting no hint Trump is eyeing New Zealand for higher tariffs. 'At this stage we don't expect it. I guess things can change but we're not getting any indication there might be more to come,' says Te Brake. 'Actually, we have a bit more faith in the US market. We anticipated there might be a slowdown in consumption or we might have more local product to compete against, but we're not seeing as much of an impact as predicted. 'There's actually been a bit more of a favourable outcome with demand there.' Zespri did not expect to pass the tariff cost on to US customers at this stage. Mount Maunganui-headquartered Zespri recorded global kiwifruit sales of $5.14b in 2024-2025. New Zealand-grown fruit international sales passed $3b. (The grower-owned company also has the Northern Hemisphere to compensate for New Zealand's off-growing season. On the general mood in international food markets after the new tariffs, Te Brake believes nerves have settled after countries 'booked' the likely impacts. 'It feels like it has stabilised quite substantially in the last two months and actually people are just getting on now. I think they're saying, 'Look we don't know what will happen and we'll respond or react once it's happened.'' The US has surpassed Australia as New Zealand's second most important export market, nearly doubling value in the past decade. Last year the US accounted for around 13% of total New Zealand export value, returning $9b from products led by dairy, wine, meat and machinery. When the 10% tariffs were announced by Trump in early April, it was forecast that if fully passed on to American consumers, they could cost New Zealand exporters $900 million more a year and prompt a drop in demand for Kiwi products. Meat exports to the US last year were valued at $2.7b. The Meat Industry Association anticipated the new tariffs would increase producers' costs 17-fold. Kiwi winemakers sell around $750m of wine to the US each year. Their industry body, NZ Wine Growers, reportedly said the new tariff would cost them $75m. On July 8, Trump announced new tariffs of up to 40% on a swathe of countries. New Zealand wasn't on the list. Fonterra's Allen says the exporter was already dealing with 'very significant' US tariffs on most of the products it exports to America. 'Where we had better access was in some of our more specialised protein products. In those products we were already facing really high hurdles – the 10% tariff effectively is additive to that ... on other products there's no kind of blanket tariff. 'Some faced a per metric tonne charge and it was relatively immaterial. Some faced a percentage charge. But for the products we did enjoy relatively good access on, effectively what it means is that the importer of record – that could be our customers or Fonterra, depending on the relationship or the way we bring the product into market – that importer of record will pay 10% on the product.' Allen says it's still early days on the tariffs. 'It's a top five market for us and we've seen some really significant growth in that market over the last few years and we will continue to see it. It will continue to be a really, really important market for us ... this is just what I would call the reality of doing business and working through it with our customers.' Dairy is one of the world's most trade-protected products globally, Allen says. As to the impact of the US tariffs, there's a whole range of factors that go into contract negotiations with markets and customers, he says. 'So now for us going into the US, this is an additional cost. Where that cost sits is just one of the many costs that come into the equation of international negotiation and setting up these multilateral long-term agreements. 'Remember, for a lot of our large contracts with our large partners, these are multi-year agreements and they're multi-faceted in terms of the inputs and the dynamics that go into them.' As to knock-on effects of the US tariffs in Fonterra's other markets, Allen says they're not yet significant. The escalation of tariffs between the US and China had the potential to impact the US dairy industry in its lower-grade lactose and whey product sales. A by-product of the US' major cheese industry, these products went into animal feed in China. But they're not products Fonterra makes in any quantity. 'In that example, most likely the Europeans or the South Americans or someone would have stepped in. 'Dairy has a pretty unique way of rebalancing itself. It's a bit of a balloon. If you poke it somewhere it tends to poke out somewhere else.' But Fonterra is 'watching carefully' the US-Europe relationship and potential for tariffs, Allen says. 'The EU is a major exporting bloc and they do export a pretty significant amount of product into the US. Again, it's anyone's guess as to what actually happens, but that potentially would have more knock-on effects into the globally traded dairy market.' Trump has since threatened a 30% tariff on EU imports. A Fonterra spokesman said it would be speculative to talk about any potential impact on the globally traded dairy market. For Fonterra, the 'explosion' in US consumer demand for protein and protein-fortified beverages in the past five to seven years presents a 'super-important opportunity', he says. 'Protein consumption has gone from the kind of product weightlifters and hardcore fitness people consumed to being now very much an everyday consumption habit for everyday Americans. Everyday foods are becoming protein-fortified.' Fonterra has for years been investing in creating protein that can go into other foods and is good to eat, he says. 'That's where we hold intellectual property. We hold some really important trade secrets and that's where we think our proteins are a huge opportunity. We've seen double-digit growth in that market in the past few years and we will continue to see protein consumption grow in the US. 'It's being spurred on now with the rise of GLP-1 and weight loss drugs.' GLP-1 receptor agonists mimic the effect of the natural GLP-1 hormone, helping to regulate blood sugar and promote weight loss. 'So the US continues to be a top five market for us.' Fonterra-supplied figures sourced from S&P Global show New Zealand dairy exports to the US between and including 2020 and 2024 totalled $5.5b. In 2020 exports were worth $887.5m. In 2024 they rose to $1.35b. With more than 75% of New Zealand's milk market, Fonterra was responsible for the majority of the exports.
Yahoo
19-06-2025
- Business
- Yahoo
Zespri targets doubling of sales in China
New Zealand-based kiwifruit marketer Zespri has signed MoUs with distributors and retailers in China in a bid to double its sales in the market over the next decade. In a statement, Zespri said the agreements were signed with its two largest distributors in China, Joy Wing Mau and Goodfarmer, as well as fruit retailers Pagoda and Xianfeng Fruit. According to Zespri, these four companies collectively account for approximately 80% of its business in China. Zespri CEO Jason Te Brake said annual sales from Greater China exceed NZ$1.4bn ($840m). 'We expect China to remain a strong market for us,' Te Brake said, adding the agreements 'will help increase both sales and the number of cities where Zespri Kiwifruit is available'. The MoUs set a joint goal to expand Zespri's market reach from 60 to 120 cities by the 2033/34 season. In the last season, Zespri exported more than 1.5 billion pieces of fruit to China. Te Brake, who took the role last May, said: 'This season we are on track to grow our volume in China by more than 8%, and with sales set to double over the next ten years, we are pleased to be right behind New Zealand's ambition to double the value of the country's exports.' He added, Zespri, which is majority owned by its fruit growers, is 'committed to continuing to invest and grow in the China' and 'delivering strong value back to our growers'. In 2024, 91% of Zespri's growers voted in favour of expanding the company's operations beyond New Zealand. The agreements coincide with Zespri's forecast for another record crop year. In the 2024/25 season, the company sold a record 220.9 million trays, up from 164.2 million trays in 2023/24. For the 2025/26 season, Zespri forecasts a total crop exceeding 205 million trays, equivalent to 738,000t. This season, Zespri has already shipped over 110 million trays of kiwifruit, constituting more than half of the total crop. The company's corporate net profit after tax, including licence revenue, is projected to be between NZ$248m and NZ$258m, up from NZ$155.2m last year. In 2024, Zespri's global operating revenue was NZ$5.14bn "Zespri targets doubling of sales in China" was originally created and published by Just Food, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
RNZ News
17-06-2025
- Business
- RNZ News
Economic headwinds in Asia considered in Zespri's new season kiwifruit forecasts
Zespri SunGold Kiwifruit Photo: Zespri / supplied Kiwifruit marketer Zespri has updated its indicative forecasts for the current kiwifruit season, as its 2800 growers examine how well licensed varieties will bear fruit for them. Zespri was expecting another record crop for the 2025/26 season of around 200 million trays, more than half of which had already been shipped to global markets. Average orchard returns per hectare for this season are steady or higher for most varieties, compared to last year's. The highest per hectare returns were seen across SunGold at $171,000-$187,000 and SunGold Organic at $154,000-$172,000. Whereas, the lowest per hectare returns were for Green14 at $63,000-$75,000 and RubyRed at $74,000-$79,000. Higher per hectare returns were forecast across most varieties, when compared to last year 24/25's average rates . Most average returns per tray last season (2024/25) matched this season's forecast ranges - except for Organic SunGold and RubyRed, which were down. RubyRed was 75 cents lower per tray than last year. Green kiwifruit had the lowest return at $8.25 to $9.25 a tray, while RubyRed had the highest sitting at $15.25 to $16.25 per tray. Chief executive Jason te Brake said the sales programme for 2025/26 had started well, particularly in Europe and North America where it was seeing "strong demand". He said forecasts reflected increased yields this season, improved fruit size for Green and RubyRed and extra SunGold and RubyRed volumes coming from new orchards. "This forecast is encouraging, though there are some economic headwinds in Asia, including inflationary pressures in Japan and our teams are working hard to secure good value in generally softer market conditions," te Brake said. "We've now shipped more than 110 million trays of Zespri Kiwifruit, which is over half this season's total crop, with RubyRed sales now complete. Our teams in New Zealand and in market are focused on continuing the positive momentum we've started the season with to deliver strong value back to our growers." He said overall, the outlook was positive. On a per hectare basis, all ranges increased on guidance provided in March, except for RubyRed which nudged down $3000 a hectare at the lower end of the range. However, returns were forecast to fall for Green and Organic Green when compared to last season. A recent report by University of Waikato Professor Frank Scrimgeour on the risks the kiwifruit industry was facing under current governance, highlighted concern that fewer than half of the 2800 growers supplying Zespri were shareholders . "Shareholder interests are not identical to grower interests," Scrimgeour said in the report. However, te Brake said provisional uptake of the recent share alignment initiatives meant more than 60 percent of growers will own Zespri shares, up from 48 percent. "Aligning the commercial interests of growers - i.e. ensuring all growers and shareholders clearly see the benefit to them in new opportunities - will be critical to this. "With strong demand and the industry continuing to perform well we are making the right steps set ourselves up for the future and we're committed to continuing to do so." Last month, the kiwifruit marketer reported an after-tax profit of $155.2 million for the financial year, down 10 percent on last year to $173.3m. Sign up for Ngā Pitopito Kōrero , a daily newsletter curated by our editors and delivered straight to your inbox every weekday.
Yahoo
17-06-2025
- Business
- Yahoo
Zespri forecasts 'strong' kiwifruit season but adjusts price ranges
New Zealand kiwifruit grower Zespri is forecasting another record crop year but has selectively narrowed the price guidance for the 2025/26 season. Although the so-called orchard gate return (OGR) "indicative" forecast from the group signals a 'positive start' to the season, the firm has adjusted its price per tray ranges from the preliminary outlook released in March. For the Zespri Green kiwifruit variety, the range is now NZ$8.25 ($5.01) to NZ$9.25, compared to the March outlook of NZ$8-9.50. The Zespri SunGold Kiwifruit is expected to be between NZ$11-12 per tray versus NZ$11-12.50. For Zespri Organic Green, the range is projected at NZ$11-12.5, compared to NZ$10.50-12.50. According to CEO Jason Te Brake, the anticipated average returns per hectare for Green, Sweet Green, Organic Green, and Organic SunGold Kiwifruit are set to exceed the figures recorded in the prior year. The grown was attributed to 'increased yields', along with 'improvements' in fruit size and additional volume from new orchards. Te Brake said: 'We have another bumper crop of more than 200 million trays from New Zealand this season and our sales programmes have started well, particularly in Europe and North America where we have seen strong demand.' Despite the 'encouraging' forecast, the CEO, who took the role last May, warned of 'some economic headwinds in Asia, including inflationary pressures in Japan'. He added that the Zespri 'teams are working hard to secure good value in generally softer market conditions'. In the 2024/25 season, Zespri sold a record 220.9 million trays, up from 164.2 million trays in 2023/24. Zespri forecast in March, a total crop exceeding 205 million trays for 2025/26, equivalent to 738,000t. This season, Zespri said it has already shipped over 110 million trays of kiwifruit, which constitutes more than half of the total crop. The company's corporate net profit after tax, including licence revenue, is projected to be in the range of NZ$248m-NZ$258m, an increase from NZ$155.2m last year. In 2024, Zespri's 'global operating revenue' was NZ$5.14bn. Te Brake said that in addition to the priority of ensuring a successful season, the industry is also making progress on 'key strategic issues' such as boosting grower ownership in Zespri, with more than 60% of growers now holding shares, an increase from 48%. The development follows a 2024 grower vote, where 91% backed offshore expansion. The CEO went on to say that currently the company is 'developing our 2035 strategy to set our sights on the next ten years and how we ensure we are best positioned to deliver the greatest value to New Zealand growers'. "Zespri forecasts 'strong' kiwifruit season but adjusts price ranges " was originally created and published by Just Food, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Scoop
17-06-2025
- Business
- Scoop
Zespri Forecasts Strong 2025/26 Season Returns For Growers
Zespri's indicative forecast for the 2025/26 season has the kiwifruit marketer on track to deliver strong value to growers in another record crop year. The indicative June 2025/26 OGR forecast reflects a positive start to the season, with ranges narrowed from the initial guidance provided in March 2025. CEO Jason Te Brake says average per hectare returns for Green, Sweet Green, Organic Green and Organic SunGold Kiwifruit are now forecast to exceed last year's record returns. 'This reflects this season's increased yields, improvements in our Green and RubyRed fruit size, and additional SunGold Kiwifruit and RubyRed Kiwifruit volume from newly producing orchards. 'We have another bumper crop of more than 200 million trays from New Zealand this season and our sales programmes have started well, particularly in Europe and North America where we've seen strong demand. 'This forecast is encouraging, though there are some economic headwinds in Asia, including inflationary pressures in Japan and our teams are working hard to secure good value in generally softer market conditions. 'We've now shipped more than 110 million trays of Zespri Kiwifruit which is over half this season's total crop, with RubyRed sales now complete, and our teams in New Zealand and in market are focused on continuing the positive momentum we've started the season with to deliver strong value back to our growers.' Zespri corporate net profit after tax including licence revenue is forecast to be $248-$258 million, up from $155.2 million last year. Mr Te Brake noted that while the focus remains on delivering the season well the industry was also making progress on key strategic issues. This included increasing grower ownership of Zespri, with the provisional uptake of the recent share alignment initiatives meaning more than 60% of growers will own Zespri shares, up from 48%. This also follows the successful grower vote in 2024 with 91% of growers supporting offshore expansion, supporting Zespri's ability to continue to lead the category. 'Our industry is creating significant value for growers and grower shareholders and the communities they support, and the outlook is positive with strong demand. We are currently developing our 2035 strategy to set our sights on the next ten years and how we ensure we are best positioned to deliver the greatest value to New Zealand growers. 'Aligning the commercial interests of growers – i.e. ensuring all growers and shareholders clearly see the benefit to them in new opportunities – will be critical to this. With strong demand and the industry continuing to perform well we are making the right steps set ourselves up for the future and we're committed to continuing to do so.' 2025/26 Indicative June OGR Forecast per tray and per hectare returns Pools (Fruit Categories) 2025/26 Indicative Per Tray Range – June Forecast 2025/26 Indicative Per Tray Range – 20 March Guidance 2025/26 Indicative Per Hectare Range – June Forecast 2025/26 Indicative Per Hectare Range – 20 March Guidance Zespri Green $8.25 - $9.25 $8.00 - $9.50 $95,000-$107,000 $86,000-$103,000 Zespri Organic Green $11.00 - $12.50 $10.50 - $12.50 $85,000-$97,000 $80,000-$95,000 Zespri SunGold Kiwifruit $11.00 - $12.00 $11.00 - $12.50 $171,000-$187,000 $162,000-$184,000 Zespri Organic SunGold Kiwifruit $13.50 - $15.00 $13.50 -$15.50 $154,000-$172,000 $147,000-$169,000 Zespri Green14 $9.00 - $10.75 $9.00-$11.00 $63,000-$75,000 $55,000-$69,000 Zespri RubyRed Kiwifruit* $15.25 - $16.25 $14.50-$16.50 $74,000-$79,000 $77,000-$88,000
