Changes for 2018 harvest

The Board of Directors of Walnuts NZ Co-op has decided that the co-operative will no longer be involved in the arrangement of drying services for growers. The board wants to see our staff time and resources focused on those tasks that growers cannot easily do themselves, namely processing and marketing. In contrast, drying of walnuts is a job that can practically be done on-farm. By focusing our efforts like this, we aim to maximise the value for growers’ crops.

This decision means that you will need to either:

  • make your own arrangements with a drying service – either as an individual or working as a collective with a group of growers who are using that service; or
  • build your own drying equipment – again, either on your own orchard as an individual grower, or working with nearby growers to set up a shared facility.

The co-op, along with the NZ Walnut Industry Group, aims to help you get set up with your drying arrangements for 2018.

Moisture content and moisture measurement for 2017

Given the weather and being aware that some growers are having difficulties with the changed moisture content standard and moisture measurement method for 2017 (8% whole-nut moisture) we have decided to treat the 2017 harvest as a transitional year as we move toward these standards, and allow some variation around these ideals. To that end, for 2017, walnuts will be accepted as meeting the moisture standards if they are below 9% whole-nut moisture OR if they are below 5.5% kernel moisture. We hope this will assist growers with the transition.

As always, if you require any further information / clarification please, in this instance, contact our GM, Shane, direct.

Supply information

Our General Manager, Shane, writes:

We will also be sending a further update on Grading within the next two days but essentially the only key difference is that, in addition to the main Categories:

  • REX, MEYRIC, NZ PURPLE, WILSON WONDER & SEEDLING (previously referred to as WILD),
  • we have introduced a new Category “ GRAFTED – OTHER”. This category covers Grafted Cultivars other than those listed. These other Grafted Cultivars (eg. 101, Vina, etc) can be combined into one bag or bin but will still be considered a single line for Grading purposes based on Quality and Size.

 

News from the factory

Our GM, Shane, reports to the board at our monthly meetings, covering operational matters at the factory, health & safety, and the previous month’s financial results. Items of interest include:

  • There is work underway on a new grading system for the 2017 harvest – details should be out to you soon. The new grading system should be robust and transparent from a financial audit point of view, and provide quantitative data to growers on the quality of their crop so the grower can see why a particular grade was given.
  • We are considering the purchase of a second cracking machine to enable us to deal with the high volume of walnut supply predicted for this coming year.
  • There has been work done at the factory to determine the costs involved in each of our products. A lot of data have been gathered and analysis is underway to help us understand which products are most profitable for us.
  • We are participating in a business evaluation and coaching programme called ‘Enterprise DNA’ run by KPMG, with funding assistance through Callaghan Innovation. This will help us identify and act on areas for improvement in our leadership, strategy, marketing, networking with other businesses, customer relationships and other areas.

Board strategic planning

The board met on 3 February for a strategic planning session to look forward over the next three years and develop goals for that period. Critical Success Factors were agreed on at themeeting.  We decided that for Walnuts NZ to be successful it must be especially good at thefollowing activities:

  1. Marketing and selling all our products to the most profitable markets
  2. Efficient processing
  3. Maintain the full support of our shareholders.

We analysed our strengths, weaknesses, threats and opportunities, and decided on the following specific objectives:

  1. Walnuts NZ enjoys an engaged shareholder base as a result of being well regarded and successful. Growers become financially successful and enjoy participating in their industry and new participants are being attracted
  2. Financially successful
  3. Participating in high margin “Super Profit” market sectors
  4. Significant improvement in operational efficiency
  5. Build capacity to process and sell the increased supply volumes predicted in coming years
  6. Committed and stable management team.

We are still working on the details of quantitative ways of measuring our success in these areas.

Grades and sizing

We are currently reviewing our grading system and will get the new grade definitions out to you as soon as we
can. As in previous years, however, there will be higher prices for:

(a) certified organic compared to conventional;

(b) larger walnuts compared to smaller;

(c) walnuts separated into certain cultivar lines compared to mixed cultivar;

(d) walnuts that are clean and light-coloured compared to discoloured walnuts.

You need not size-sort your walnuts as the factory is purchasing sizing machinery. Your walnuts can come in to
the factory with all sizes mixed into your bags or bins. However, your pay-out will take account of the
proportion of walnuts that fall into each size grade (in addition to the other factors above). Regarding (c)
above, we are currently deciding which cultivars can be mixed together and which should be separated (to
attract the higher price). This separation has to do with shell thickness, shell seal and other factors, which can
impact on the efficiency of our cracking process at the factory. However, we appreciate the extra labour it can
take on the orchard to keep cultivars separate and will try to make this as practical as possible for growers.

  • Nuts that have been left wet for too long with deteriorating kernel, discoloured and mouldy nuts will
    be downgraded or even rejected;
  • The most helpful thing that you the Grower can do for yourself, the industry and the Co-operative is to
    supply high quality clean walnuts

Changes for suppliers from last year

  • The co-operative has negotiated a walnut drying price with Southern Seed Technology (SST) near Irwell,
    Canterbury. We are not operating the drying service ourselves but are just facilitating the arrangement
    between the grower and SST. For ease of administration (of both SST and growers), the co-op will pay
    SST in bulk for all walnut drying then deduct the relevant amount from the final payout of growers who
    choose to dry their walnuts at SST. The price for drying (with transport to factory and storage included)
    will be not more than 55c per kg of wet walnuts, but we are still finalising details. See also notes below
    about storage. Alternatively you can dry your own walnuts.
  • We are changing the method of measuring the moisture content of walnuts. In the past we have
    measured the moisture content of the kernel only, but from 2017 onward we will be measuring the
    whole nut, i.e. both shell and kernel broken up together. In addition to the method of measurement, we
    will be requiring walnuts to be dried down to a lower moisture content than has been the case in the
    past. See further details in this newsletter.
  • Storage space will be limited at the factory because our rising crop volume means that more space is
    now taken up with processing equipment. The factory will need to hire off-site storage to supplement its
    own. At the same time, to meet our HACCP food control plan and to ensure quality walnuts, we are
    placing a greater emphasis on the suitability of storage facilities this year. This means we are in a
    transitional situation with regard to storage.
  • To safeguard walnut quality, all growers should ensure their nuts are either sent in to the factory or
    placed in an approved storage facility as early as possible after drying. If you supply over 1 tonne and
    believe you have suitable facilities to store your own walnuts (and perhaps those of other growers) we
    are happy to discuss this on a case-by-case basis. We may need to inspect and approve your facilities.
    We would call these walnuts in for delivery when we are ready to process them. For those drying at SST
    and storing their own walnuts at an approved facility, the storage and transport components of the
    drying cost would be subtracted from the total. Our biggest growers need to store their own walnuts in
    an approved facility as we do not have space in the factory storage for these large volumes immediately
    after harvest. For smaller growers drying their own walnuts, please phone in advance to arrange for
    your walnut delivery to the factory. We may charge a small storage fee to assist with off-site storage.
  • You will not need to size-sort your walnuts on-farm as we are purchasing size-sorting machinery for the factory. Proportions of your crop in different size categories will still be considered in determining your
    payout, but you do not need to separate these size categories yourself.
  • We are currently reviewing the grading system and will send out the new grade definitions to you in a
    future newsletter. For now, however, in this newsletter, we have listed the factors we will consider in
    the grading system.
  • In future, we will need to view a copy of your orchard spray diary as part of our food safety plan. At the
    present time, we appreciate that some growers may not keep such records, so we don’t expect you to
    have these available this year. However, we aim to work with you on developing a standard recording
    template in the coming year. This year, as usual, you will just be required to record on your consignment
    note the names of the sprays used on your orchard. For this year, this will be your formal
    record/declaration.
  • As a co-operative, we are here to help our growers. If you’re unsure of any of these arrangements,
    please free to contact us at the office.