By Bryan Parkes
19 April 2018
The idea that a twig can embody years of research might sound odd, but when the New Zealand kiwifruit industry was struck by the vine-killing bacteria PSA in 2010, it was this - a disease-resistant cultivar/twig - that came to the rescue. Grown from a seedling with outstanding genetics, in a programme with Plant and Food Research and Zespri to explore new varieties of kiwifruit, this twig was the key to producing award-winning, high-tech product, the Zespri SunGold kiwifruit.
Bryan Parkes, Innovation Team Leader, New Cultivar Development at Zespri International, explains. “A new cultivar can be a radical step change for the kiwifruit industry,” he says. “And that twig of the Zespri SunGold cultivar embodied tens of millions of dollars of financial investment to develop a very efficient biological factory – a factory that produces golden kiwifruit.”
The investment turned out to be a smart one. Not only was the SunGold cultivar resistant to PSA, it actually had superior yield, flavour (a balance of sweet, acidic and tropical, according to Parkes) and a long eating window. "We can hardly keep up with demand," says Parkes. "Everytime we get some more feedback from the market we’re having to extend our production to meet forecast demand, so it’s been an amazing story."
Above: Bryan Parkes.
Zespri SunGold as a high-tech kiwifruit factory is all the more valuable when you consider it can be deployed to rural regions to produce an amazing kiwifruit product that's in demand around the world. These kiwifruit "factories" have the advantage that there is no need for the huge infrastructure normally required when creating a conventional factory, but they're still able to generate significant value for the owner, region and community. They are also environmentally friendly factories, absorbing carbon dioxide and improving the soil.
Parkes recalls the days when some growers questioned the need for investing in cultivar development when they already had a green (Hayward) and gold (Hort16a) variety. The PSA disease was a factor that demonstrated the importance of continuing to innovate. With it came the harsh realisation that a good performing product today does not assure you of good profits in the future.
"The disease demonstrated the importance of continuing to innovate...a good performing product today does not assure you of good profits in the future."
The reality is, says Parkes, Zespri’s ability to evolve and invest in long term innovation investments like new cultivar development could not have occurred without critical mass. This critical mass was achieved when the entire New Zealand kiwifruit industry effectively collaborated to form Zespri, and collaborated again to invest in research and development. Added to that has been the hugely important contribution of Plant & Food Research and the support of the New Zealand government.
“Part of our success is absolutely driven by critical mass," says Parkes. "Being one of New Zealand’s biggest export companies gives us the ability to invest long-term, and we have scale to then commercialise and extract value from investment long term.”
“A lot of smaller New Zealand companies can’t get that critical mass to allow for long-term investments. This is one of our big challenges as a small country. We need to play on our strengths, which is often areas where we have critical mass. We have good scale in the primary industries, so investment in high-tech primary industries innovation is a good investment for New Zealand in my opinion. A challenge is, however, the parts of each primary industry investing jointly and extracting value in a well-coordinated way.”
I would like to see industries invest more in research and development to benefit all of New Zealand. It's time to address disappointing global benchmarks that show New Zealand is light on private company investment in research and development.
The challenge is taking the ideas that bubble up through government-supported research, or separately, and channeling them to something commercially valuable for all New Zealanders. Then the next challenge is to ensure the ideas are not sold to a foreign company before New Zealand captures the benefit. There’s also the need for capability and support to traverse the ‘valley of death’: that period between an idea’s gestation and it being mature enough to stand on its own two feet.
New Zealand would also benefit from a strong venture capital fund culture, I think we are a bit light in that space, but have improved significantly in the last several years. I want to see New Zealand companies capture value from innovation for New Zealand, rather than be picked off by bigger international companies before they reach their prime.
"It's time to address disappointing global benchmarks that show New Zealand doesn’t invest in research and development enough"
New Zealand companies need the expertise to identify the opportunities and the culture to be interested in progressing them. The fact New Zealand has “so many” small to medium enterprises (SMEs) can be a handicap in long term R&D investment to generate these ideas.
SMEs don’t often have the budgets to contemplate long-term investments in innovation. Nor do they necessarily have the scale to be the best partner to commercialise those opportunities with. The result? Many SMEs heading offshore to find healthier business environments – for example, New Zealand businesses in the IT sector heading to San Francisco.
I believe the ‘Precision Seafood Harvesting’ technology developed in New Zealand by Plant & Food Research with Aotearoa Fisheries, Sanford and Sealord, is an exciting primary industry technology to keep an eye on, thanks to the “revolutionary” approach to how seafood is harvested, which improves quality of the fish caught and minimises bycatch.
From a global perspective I think this technology offers a massive opportunity, but I wonder if the New Zealand companies can find a model that successfully commercialises this technology around the world. Can they transition from a commodity mind-set to a high value offering to consumers, and will consumers be willing to pay for the better quality product with stronger sustainability credentials?
It’s a classic example of a New Zealand primary industry with huge opportunity generated from research investment. It will however need the companies that developed it to work together with critical mass to realise the global opportunity.
Techweek is delighted to call Zespri a partner for Techweek'18 event 10 Billion Mouths,. You can hear many more discussions about the success and challenges at the event on the 23rd May. Buy tickets here.
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