Profit trends upset pip-fruit board

Press, 18 September 1976, Page 18

Profit trends upset pip-fruit board

PA Wellington Sales and pa> ment trends of the 1970 s are causing the Apple and Pear Board "considerable concern” and cannot be allowed to continue indefinitely, according to the board's annual report. The report said the board had record sales of $49,169,026 in the year ended November 30, 1975, resulting in a trading surplus of $10.17,905. This represented a return of 2.07 per cent on sales, or 13c per tra\ carton equivalent.

But because of the deficit in the industry reserve account from the 1974 -season, and the need to apply the 1975 trading surplus to reduce the special overdraft loan advance by the Reserve Bank, it was not possible to make any distribution to growers, it said. "This is disappointing, in view of their difficult times. However, the full value paid to growers over the last six vears has been in excess of that justified by the subsequent

very conscious of the urgency to re-establish the industry on a better foundation.

As well as working with the Fruitgrowers’ Federation in commissioning the report of the market research centre of Massey University, it is undertaking a comprehensive review of its total operations, with particular emphasis at' distribution, management and quality control.

Exports of apples and pears had risen by 102 per cent, from $9,166,000 in 1970-71 to $18,540,000 in 1974-75. This was compared with an increase of 6.7 per cent in total agricultural exports, and 26.6 per cent of all exports.

The volume of sales now bypassing the board was jeopardising an orderly marketing programme, it said. Even worse was the increasing illegal sales direct from growers to retailers, or grower to grower. "These law-breakers only profit because of the umbrella provided by the board, or rather that provided by their fellow growers, for the board is in effect a growers’ cooperative.” The board was also upset about the abuse, intimidation and risk to which its inspectors were exposed in attempting to prevent illegal selling.

The board was also the “splendid support” from watersiders and harbour people at its fruit ports, which contributed to its capability to compete against other Southern Hemisphere suppliers who enjoyed geographical advantages.

Total fruit intake amounted to the equivalent of 6,970.000 traypack cartom. comprising

246,000 cartons, despite and 441,517 cartons of pears. This was again a record, exceeding 1974 by 246,000 cartons, dsepite unfavourable conditions in both Nelson and Otago. Nearly 58 per cent of the total crop was submitted for export.

Sales increased by 8 per cent, with an over all improvement in gross revenue of 49 per cent. There was a drop of 9 per cent (97,000 cartons) in sales to the United Kingdom, but the average price improved by 41 per cent equivalent to $2.60 a carton.

Sales on the Continent increased by 13 per cent (209,000 cartons), at an increased average realisation of $3.32 a carton (an increase of 52 per cent). Direct costs for the year rose by almost 18 per cent, representing $6.4M, of which S3.BM was freight cost increases.

Total sales to all markets outside Europe increased by 179,443 cartons to 1.244.420 or 31 per cent of total exports. In North America sales rose bv 130,000 cartons over 1974.

Sales in South-East Asia showed a relatively small increase to 432,000 cartons, with Indonesia holding the major potential. Thirty-four thousand cartons of apples were sold to the Middle East, but port congestion was a real problem there, said the report.

On the local market the board sold 1,596,400 cartons of apples and pears, an increase of 44.500 cartons over 1974. Apple sales totalled 1,273,500, an increase of 51,200, while pear sales showed a reduction of 6000 carton equivalents, to 322,900.