Understand climate risks.

In recognition of the potential impact that climate change can have on supply chains, businesses are increasingly seeking to understand and report climate risks. In some cases, it is mandatory to disclose climate risks. Zespri has published its first climate change report - with the goal of qualitatively determining the level of risk that climate change poses to kiwifruit production in growing regions outside of NZ that Zespri sources fruit from i.e. mainly Italy, France, Japan and Korea.

Recently, kiwifruit exporter, Zespri, has published its first climate risk report. In this, the findings are included from a piece of research that Jayson Benge of the The AgriBusiness Group undertook. Jayson’s research had the goal of qualitatively determining the level of risk that climate change poses to kiwifruit production in growing regions outside of NZ that Zespri sources fruit from i.e. mainly Italy, France, Japan and Korea. This project built on similar work completed in 2019 by KPMG which assessed the level of risk climate change poses to kiwifruit production in NZ.      

The project involved two main parts. Firstly, through a desktop analysis, we identified how climate is expected to change in each growing region. In line with the recommended methodology, this was done for two different climate scenarios i.e. a medium and high (BAU) emissions futures. Then we worked closely with kiwifruit production experts and academics in each region to identify the level of risk to production for each climate projection.

In addition to the above, we also identified transitional risks for Zespri. These are non-physical risks related to shifting to a lower emissions economy. A form of transition risk would be any regulation that limits what growers can use on their orchards, such as fertiliser, or a tax on carbon emissions. An example of regulation that has the potential to affect Zespri and other NZ primary sectors is the European Commission’s Green Deal.

One of the implications of this could be a restriction on chemicals that can be used on orchards. Another form a transitional risk is the loss of social license to operate or consumer aversion to products which are deemed to be unsustainable including having relatively high carbon emissions.

These findings are being used by Zespri to inform the development of a climate change adaption strategy, support decisions around future growth of the Industry outside of New Zealand - in order to provide Zespri kiwifruit to consumers all year round.

Written by Jayson Benge.