Monday, April 22, 2024

What it would take to land Rockit in India 

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Better IP safeguards would pay dividends for Kiwi apples on sub-continent.
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India’s aim to lift the value of its agricultural production may be met in part by a New Zealand company that is turning apples and pears into high-value branded food items.

At the recent India-NZ Business Council trade summit in New Delhi, Shri Sanyal, an economic adviser to India’s Prime Minister Narendra Modi, cited the country’s high reliance on agriculture as a focus of government policy. 

With 40% of the workforce engaged in agrarian activity, which generates only 11% of the country’s wealth, a key focus is to move more labour into higher paying manufacturing and tech occupations.

Sanyal also acknowledged the need for India to add greater value to its agricultural output to meet the expectations of its burgeoning middle-class population, expected to top 700 million by 2030.

Tony Martin, CEO of pipfruit genetics company Prevar, said the company’s Rockit apple provides a good foundation to work from, with Indian colleagues to develop such a value-add branded product in what is traditionally a commodity market.

Rockit apples, already well established in a variety of global markets, are grown by selected growers around the world, including in NZ. The fruit’s snack-size and clever tube packaging mean it manages to command solid premium on conventional fruit. 

As a licensed variety, it generates Prevar royalties for every single apple sold. The company also has licensing rights on the Dazzle apple variety and PiqaBoo, a red-skinned, white-fleshed pear.

Martin said as highly efficient, productive apple growers, the NZ industry is now facing a tougher environment as competing countries across the southern hemisphere catch up, particularly South Africa and Chile.  

“Simply growing more and putting more apples in boxes is not the pathway to future wealth gain for the sector,” he said.

India’s ability to meet its own demand for apples is falling short, in a market that on average consumes only 1.5kg of apples a year per capita, compared to about 28kg a year in China, and 20kg in NZ.

“Apples are not as accessible as a lot of tropical fruits, and the quality is not good, with a lot of fruit lost in the supply chain.”

In the short-term for Prevar, India is about growing the presence of its fruit brands in a market that attracts 30% tariffs, with a view to longer term collaboration with growers to supply the value-added fruit.

This raises the challenge of protecting the company’s IP around the fruit germplasm, something that can be challenging within NZ, let alone India.

Zespri is all too familiar with the challenges, dealing with a surge in illegally grown SunGold fruit in parts of China after a NZ grower illegally sold germplasm to growers there.

“You need local personnel here with boots on the ground to maintain a watchful eye on where plant material is going,” Martin said. 

“The quarantine facilities here are a long way behind other countries, with material usually moving pretty quickly from quarantine to orchards …
“You have to have that local personnel. Just one graft means you could suddenly have 8000ha of your fruit growing there.”

The company is considering opportunities on apples that could be grown in India, including the foothills of the Himalayas in Himachal Pradesh, and the Kashmir region.

“This brings us to collaboration. We really want to focus on knowledge transfer and to shore up IP protection, to also ensure Indian growers are protected. We see a runway of 20-25 years.”

He said NZ cannot be a scale producer in the global apple market.

“So, let’s get our fruit grown closer to the consumer and keep NZ as the niche/development and skills market. The challenge is, how do we get growers on board with that philosophy?”

With a background that includes work with NZ Trade and Enterprise and multiple visits to India, Martin said NZ’s latest trade delegation to India represents a big step forward for engagement.

“There is a good sense of momentum here. The company QualityNZ [see article here] is very much a pioneering one for those who have the wherewithal to do it.”

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