BCG New Zealand says Hawke's Bay growers are still facing tough economic conditions a year on from the cyclone. (file image) Photo: Supplied
The Hawke's Bay horticultural sector needs at least $410 million additional funding to fully recover from Cyclone Gabrielle, a new report shows.
Boston Consulting Group's (BCG) report updates the estimates done shortly after the February 2023 event, dropping the initial budget ($920 million) by about a quarter of a million dollars.
BCG New Zealand managing director and partner Phillip Benedetti said since May 2023, the government had provided $240m in grants and concessionary loans to support the sector's recovery.
"Effective clean-up activities and favourable growing conditions have reduced initial economic losses and replanting costs, reflecting a slight positive deviation from initial forecasts," Benedetti said.
But the report calculated at least $345m more was needed for replanting and reinstatement and $65m more was needed for on-orchard clean-up.
Benedetti said Hawke's Bay growers were still facing tough economic conditions a year on from the cyclone.
"The new report has shown growers are facing tightening margins with increasing production costs and challenges that have been exacerbated by Cyclone Gabrielle's impact on harvests and infrastructure. SMEs [small and medium-sized enterprises] in particular have struggled to bounce back post-cyclone."
Apples and Pears New Zealand chairperson Lesley Wilson welcomed the report, saying growers were already struggling with high costs and low returns prior to the February event.
The money would need to come from a range of sources, Wilson said.
"We understand that the government's books are very tight at the moment, but rest assured, at every chance we get, we talk to our local MPs and our ministers. They will be looking with interest at the BCG report too, and (therefore) we're hoping they will find a way to help us out further."
"Hawke's Bay and Tai Rāwhiti and other regions that were hit - orcharding [is] in an integral part of the community. [There are] huge employers in those regions. So Apples and Pears is committed to its vision of being a $2 billion industry by 2035 and we're looking at all the ways possible to let growers achieve this."
It cost $250,000 to replant one hectare of apple orchard, after the silt and other remediation work was completed, so small family-sized businesses needed help to complete the re-establishment job, Wilson said.
Silt removal was still happening, but trees were also going, she said.
Replanting will take another three years because there is a shortage of apple trees with the cyclone creating unplanned for demand.
