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North Canterbury News: July 08, 2021

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NEWS<br />

16 <strong>North</strong> <strong>Canterbury</strong> <strong>News</strong>, <strong>July</strong> 8, <strong>2021</strong><br />

Truffle ‘price war’ divides growers<br />

The harvest of Perigord black truffles has started and a‘‘price war’’<br />

continues as values remain athird of historical prices. Allied Press’<br />

Shawn McAvinue investigates the factors impacting the price of the<br />

‘‘black gold’’ and the state of the industry.<br />

Ablack truffle‘‘price war’’ is ragingin<br />

New Zealand.<br />

LimestoneHillsowner Gareth<br />

Renowden, of Waipara Valley, grows<br />

Perigord blacktruffles in his truffiereof<br />

about 220 trees in <strong>North</strong><strong>Canterbury</strong>.<br />

The truffle species was the first type to<br />

be planted in New Zealand, had the most<br />

growers devoted to it and fetched the<br />

highest prices,hesaid.<br />

The average market price for a<br />

premium Perigordtruffle in New Zealand<br />

had been about $3 agram for the past 20<br />

years,hesaid.<br />

In the past two years, more growers in<br />

New Zealandhad beensupplying<br />

Perigord truffles to the domestic market.<br />

Demandfor truffles dropped lastyear,<br />

after restaurants closeddue to the<br />

financial impact of Covid­19.<br />

Consequently, some‘‘newcomers’’tothe<br />

sectorbegansellingPerigord truffles fora<br />

‘‘ridiculously low price’’last year.<br />

A<strong>North</strong> Island truffle co­operative<br />

‘‘triggered the price war’’ by workingwith<br />

Bidfresh—adivision of foodwholesaler<br />

Bidfood —bymarketing truffles for $1 a<br />

gram.<br />

Bidfreshused lowprices as a‘‘weapon’’,<br />

ratherthan creating aclient base by<br />

building relationships,like truffle growers<br />

had over several years.<br />

George’sTruffles owner and New<br />

Zealand Truffle Associationacting<br />

presidentGeorge Wilkinson,ofTasman,<br />

sold his Perigord truffles from $1 agram ­<br />

‘‘undercutting’’ the market,MrRenowden<br />

said.<br />

Many growers were‘‘ropeable’’bythe<br />

price being ‘‘hammered’’ down.<br />

‘‘There was alot of ill­feeling about how<br />

the markethad been devastated by these<br />

veryrash and ill­considered short­term<br />

plans.’’<br />

Asteadyprice was important, as<br />

growers created abusinessplan on a<br />

forecast financial return,sowhen the<br />

price dropped it had aseriousimpactona<br />

truffiereoperation, he said.<br />

As Mr Wilkinson had ‘‘ledthe price war’’<br />

he was in no positiontoadvocate for the<br />

sectorand to get growers co­operating to<br />

create exportopportunities, or to make<br />

efforts to rebuild grower returns.<br />

‘‘Dumping truffleinthe market is not a<br />

verynice thing to do to your colleagues.’’<br />

The sharpfall in pricing was an ‘‘eyeopener’’<br />

for growers.<br />

‘‘No­one expected the pricing in the<br />

market to collapse quite as dramatically.’’<br />

The drop had resulted in him losing ‘‘a<br />

few sales’’ but most of his clientsstayed<br />

withhim because he had built ‘‘close<br />

relationships’’ withthem overthe past 15<br />

years.<br />

Mr Wilkinsonsaid he grew Perigord<br />

truffles among the 2200 treesofhis<br />

commercialtruffiereinMotueka.<br />

He beganselling in 2016 and was now<br />

selling a‘‘high volume’’oftruffles ­<br />

offeringthree grades exclusively to chefs<br />

in New Zealand.<br />

The lowest grade soldfor $1 agram.<br />

He sold truffles at pricesheconsidered<br />

to be fair, ratherthanworkingtoa‘‘price<br />

point’’, like some other growers.<br />

The aim was nevertopoachclients from<br />

other growers but to offer aproduct at a<br />

price and let the chefs decide on the best<br />

deal.<br />

Truffle scuffle ... Limestone Hills owner Gareth Renowden, of Waipara Valley, smells a<br />

truffle in <strong>North</strong> <strong>Canterbury</strong>.<br />

PHOTO: PAUL THOMPSON<br />

‘‘It’ssimple business. Idon’t see it as a<br />

price war.’’<br />

Bidfresh Hamilton generalmanager<br />

Gus Tissink said he rejectedMr<br />

Renowden’s claim Bidfresh had triggered<br />

aprice warbyreducing prices.<br />

About 30 percentofBidfreshtruffle<br />

supplylast season —about 15kg —was<br />

offered at $1 agram to specific clients.<br />

The remaining 70% of truffle was<br />

offered to the market at the normal price<br />

of $2.50 agram.<br />

Bidfresh was selling all its truffle at<br />

$2.50 agram this season and the produce<br />

was ‘‘moving’’ at that price.<br />

He expectedanoversupplyoftruffle to<br />

be an ongoing issue as there were more<br />

than 250 truffieres in New Zealand<br />

producing up to 400kg of produce.<br />

‘‘The marketisnot goingtobeable to<br />

holdthat value domestically.’’<br />

Mr Renowden doubtedtruffleprices<br />

would recover to the $3 agram price but<br />

expected it to settlebetween $2 and $2.50<br />

agram if the sector beganexporting.<br />

An association member and former<br />

president, Mr Renownden saidexporting<br />

was asolutiontothe issue of oversupply<br />

on the domestic market.<br />

Truffles had a10­day shelf­life and<br />

would need to be airfreighted to<br />

international markets.<br />

He agreed international markets would<br />

wantmuch more than individual growers<br />

could supply, so the industry neededto<br />

‘‘pool their crop’’ to meet the demand.<br />

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