September 6, 2024

By Gerelyn Terzo, Global AgInvesting Media

New Zealand’s Craigmore Sustainables has scooped up a pair of apple orchards as it seeks to expand its horticulture footprint. The deals include the Ngaruroro orchard in the Twyford region of Hawke’s Bay and Patutahi orchard in Gisborne, which are expected to have a combined canopy area of more than 110 hectares (271 acres). The assets, which Craigmore acquired from Kiwi Crunch and Judco, respectively, are situated in tier-one apple-growing regions boasting desirable climatic conditions and nearby apple-market infrastructure.

Craigmore’s latest orchard deals, the price of which remains unclear, represent the maiden investment it has made on behalf of a European institutional investor-owned client. Craigmore will oversee governance and management services for the client. These orchards add to Craigmore’s 290 hectares (716 acres) of existing apple orchards under management across Hawke’s Bay and Gisborne, the most recent of which includes a 180 hectare (444 acre) canopy in the Ongaonga region.

Craigmore CEO Che Charteris stated, “In line with Craigmore’s strategy, there will be a high level of New Zealand control over both investments and operational decisions for these orchards.” He added that Craigmore recognizes a “significant need for additional patient long-term capital in the New Zealand apple sector.”

New Zealand’s apple industry has been in recovery mode after severe flooding and winds rocked key apple-producing regions in early 2023, owing to the wrath of Hurricane Gabrielle. In the 2023/24 season, total production is predicted to hit 483,000 metric tons (MT), reflecting a 9 percent increase year-over-year. Positive catalysts include a weakening El Niño phenomenon, a stronger labor force, ag innovation and favorable weather conditions. Last year, New Zealand’s apple season faced a perfect storm of severe flooding and fierce winds, which wreaked havoc on numerous orchards and resulted in the smallest harvest in over a decade.

Since the hurricane, Hawkeye’s Bay, the location of Craigmore’s Ngaruroro orchard addition, has been the subject of headlines of late, where approximately 66 percent of New Zealand’s apples are grown. Apple orchard sales have been unfolding fast and furiously in the region of late, including Kiwi Crunch’s recent divestment comprising 72 hectares (178 acres) to Germany’s Beehive Demetra, a subsidiary of Munich Re created to invest in New Zealand’s horticultural assets, according to reports. Beehive is expected to add value to the orchard by replanting more profitable apple varieties.

New Zealand’s apple exports are forecast to reach 330,000 MT in the current season, reflecting close to a 7 percent increase year-over-year. While the apple is the No. 1 fruit consumed in the United States, it takes the No. 2 ranking in New Zealand, surpassed only by the banana.

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