Zespri's Kiwifruit Bonanza: Can Record Harvests Overcome Regional Demand Risks?

Zespri, the global kiwifruit giant, has once again defied expectations by forecasting a record-breaking 2025/26 season, with production expected to surpass 205 million trays—equivalent to 738,000 tonnes. This marks the third consecutive year of historic volumes, driven by new orchards, improved yields, and strategic expansions. However, the company faces a critical balancing act: leveraging this abundance to maximize returns while navigating headwinds in key Asian markets and managing quality risks. For investors, the question is whether Zespri's operational prowess and strategic shifts can offset these challenges.

The Production Boom: Prices, Profits, and Per-Hectare Gains

The core of Zespri's 2025/26 outlook centers on record-breaking yields and adjusted pricing. While total crop volume has surged, the company has narrowed its price guidance for most varieties, signaling cautious optimism about demand. For instance, Green Kiwifruit prices are expected to range between NZ$8.25–9.25 per tray, slightly lower than earlier projections, while Organic SunGold prices have dipped slightly to NZ$13.50–15.00.

The most compelling data lies in per-hectare returns, which Zespri CEO Jason Te Brake highlighted as surpassing previous records. Green Kiwifruit's returns now sit at NZ$95,000–107,000 per hectare, up 9–10% from March projections. Organic SunGold, however, saw a modest dip, reflecting potential softness in premium markets. underscores the financial confidence underpinning this outlook, driven by economies of scale and higher volumes.

Regional Demand: A Tale of Two Hemispheres

Zespri's success hinges on its ability to navigate divergent market dynamics. In Europe and North America, sales programs are performing “well,” with strong demand for both Green and RubyRed varieties. The latter's berry-like flavor has proven a hit in U.S. markets, where it recently debuted. However, Asia—a critical region accounting for roughly half of global kiwifruit consumption—presents challenges. Japan's inflationary pressures and shifting consumer preferences have dampened demand, while China's market remains volatile amid trade tensions.

This geographic disparity creates a dilemma: while Zespri can lean on resilient Western markets, it cannot afford to let Asia's slowdown undermine overall profitability. The company's focus on expanding RubyRed production in Italy—a strategic move to ensure 12-month supply—aims to mitigate this risk by broadening its product mix and reducing reliance on seasonal demand.

Strategic Shifts: Ownership, Expansion, and Long-Term Planning

Zespri's governance structure has evolved in tandem with its operational ambitions. Over 60% of growers now hold shares in the company, up from 48%, reflecting a deepening alignment between growers and corporate strategy. A 2024 vote saw 91% of growers support offshore expansion, a vote of confidence in Zespri's global vision.

The company's 2035 strategy, still in development, emphasizes long-term value creation for growers through market diversification and supply chain optimization. The recent approval of 170 hectares of RubyRed orchards in Italy exemplifies this approach, blending innovation with geographic diversification.

Risks and the Road Ahead

Despite these positives, risks loom large. Quality control remains critical: if the record crop leads to fruit degradation during shipping, costs could rise sharply. Geopolitical tensions, particularly in Asia, could further constrict demand. Additionally, the slight downward adjustments in Organic SunGold pricing hint at potential oversupply concerns in premium segments.

Investors should also monitor Zespri's execution of its 2035 strategy. The company's ability to balance short-term profit goals with long-term market resilience will determine whether this season's bounty translates into sustained growth.

Investment Takeaways

For investors, Zespri presents a compelling but nuanced opportunity. The record harvest and per-hectare returns suggest a strong near-term tailwind, especially in high-margin varieties like RubyRed. However, the reliance on Asia's recovery and the need to manage quality costs introduces volatility.

The stock—though privately held—can be indirectly accessed via agricultural ETFs or New Zealand equities tied to agribusiness. For direct investors, Zespri's share structure offers a unique ownership stake in a dominant brand.

highlights its trajectory, but the next phase will test its ability to navigate demand imbalances.

Final Verdict: Zespri's 2025/26 season is a testament to its operational excellence and strategic foresight. Investors should take a measured, long-term view, focusing on execution of its Asia strategy and RubyRed expansion. While risks remain, the combination of record volumes and premium pricing positions Zespri to weather near-term headwinds—and possibly emerge stronger in the decade ahead.