46 | Central Otago: 45 South REGIONAL DEVELOPMENT Covid curveballs for cherry industry Richard Loader 45 South CEO Tim Jones: “We’ve had a couple of really tough seasons with fewer options for air freight and obviously at a much higher cost than what it was pre-covid.” Like many industries around the country, labour shortages and logistics issues resulting from Covid are the two biggest challenges currently faced by New Zealand’s cherry industry, says Tim Jones, CEO of 45 South, New Zealand’s biggest grower and packer of export cherries. “For us the impact that Covid has had is the lack of tourists coming to New Zealand, because it was the planes that those tourists came to New Zealand on that used to take our cherries back to our overseas markets. We’ve had a couple of really tough seasons with fewer options for air freight and obviously at a much higher cost than what it was pre-covid.” Established in the mid-eighties, 45 South’s cherry orchards are located in the Cromwell basin in the traditional fruit growing area of Ripponvale. On average 45 South grows about 25% – 30% of New Zealand’s cherry crop every year, with about 70% exported. “South East Asia is a very important market for us. We used to have a lot of South East Asian tourists and that was perfect for us to get our fruit back into those markets. With Covid and virtually no airlines flying into New Zealand overnight we were faced with having to look at different options. We went from a passenger plane flying with passengers and a few cherries in its hold, to a passenger plane flying with no passengers and forty tonnes of cherries in its hold, but at a much higher cost. What we learned was how much the passengers were subsidising the freight cost.” In broad numbers, pre-covid air freight was about $2.50 a kilo for air freight. That jumped to $5.00 a kilo and more in the post-covid world. Looking ahead, Tim says it’s great news the boarders are open and tourists will start coming back to New Zealand, therefore more planes and flights. But he sees challenges next season if the planes heading out of New Zealand are full of passengers as they will have much less capacity to carry cherries. “It might only have capacity for ten - fifteen tonnes of freight, over and above everyone’s suitcases which means we need to have three times as many planes coming, just to take the amount of fruit that has gone out of the country in the last couple of years. The flights going out of the country at the moment are jammed packed and you can’t get a seat, but at this stage we’re not seeing the reverse coming back into the country.” Tim hopes backpackers will start streaming back into the country because of the impor- “South East Asia is a very important market for us. We used to have a lot of South East Asian tourists and that was perfect for us to get our fruit back into those markets.” tant part they play in the cherry harvest, but says the holy grail for anyone in the industry is how reliance on seasonal labour can be reduced. “At the moment that’s in the packhouse because that’s the easiest place to automate. Over the last three years 45 South has developed its own software in conjunction with the manufacturer of the grader, to give better grading accuracy. Instead of having a machine just look at how big a cherry is, artificial intelligence will determine whether or not it has a defect on it. Our grading equipment is now doing an accurate enough job getting defects out of the line that we’ve been able to reduce packhouse staff by 20% over the last two years.” 45 South’s next project is looking at the ability to put automation into the singulation of clustered cherries. Cherries grow in clusters of three to four on the tree, which get picked off in its cluster. Those cherries are manually singulated in the field by the picker after being picked from the tree, enabling the fruit to be sized. “We’re looking at ways to automate that but some R&D is still required to make that work successfully. We estimate that if we had the right equipment, it would reduce the number of pickers by a third, and that flows right down to the need to provide accommodation, which is a very expensive part of our operation.” Over its 35-year history, innovation and having key people in the business have been at the heart of 45 South’s success. “You can put all the fanciest gear in the world into a business but if you haven’t got the right people to run it, you haven’t made as much progress as you could have,” says Tim.
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