John Bostock says the Honeycrisp investment near Timaru provides access to a high-value variety with strong North American demand.
In a first-time joint venture for Bostock New Zealand, the company has partnered up with equity company Milford Private Equity to purchase orchards growing a high-value apple variety for the North American market.
Bostock NZ owner John Bostock said the partnership with Milford Private Equity gives the company the ability to purchase, manage and expand from the 76ha base of five orchards purchased near Timaru growing the Honeycrisp variety apple.
Not available in NZ, the Honeycrisp commands a premium four times that of a conventional Gala apple and is popular for its slightly acidic taste profile and extreme juiciness.
The apple was developed in Minnesota in the mid-70s and is capable of withstanding the region’s extreme winters and is recognised as one of the 15 most popular cultivars in the United States.
According to the most recent apple category data, Honeycrisp accounts for over 30% of apple sales in the US. In the Midwest, Honeycrisp makes up 41% of apple sales.
The five orchards near Timaru were planted seven years ago by North American investors who have exited the project.
Bostock said the orchards are coming into 80% full production this season, and until now production has had to be trucked to Nelson for packing.
“If the project proves successful then we will be looking to develop more infrastructure in Timaru to handle the fruit,” he said.
He said Timaru lends itself well to growing the cold climate apple variety, which brings its own challenges to grow, but commands a premium and is almost a separate category within the apple section of the US market.
Bostock is the largest organic apple growing company in the Southern Hemisphere, with a strong North American marketing presence already in place.
Having orchard capacity to grow the Honeycrisp here organically means NZ can fill shelf space in the North American offseason, with harvesting in March for April retailing.
Milford investment director Brooke Bone said the investment was an exciting opportunity for investors to get access to a premium horticultural investment in partnership with one of NZ’s top horticulturalists.
“We’re pleased to invest in the local economy, exporting a great New Zealand product,” Bone said.
Should the venture prove successful, Bostock said there could be an opportunity for further orchard investment in the Timaru district.