Matapihi based Ngai Tukairangi Trust has paid $40.2 million for a Hawke's Bay kiwifruit orchard in what is believed to be a record price for any horticultural land.

'We are fielding quite a bit of interest,” says Trustee Neil Te Kani.

'It's a strategic decision, we signaled it at last year's AGM we said we need to get bigger in terms of our footprint in the industry. We see that footprint having an impact on returns back to growers so it's an exciting industry and we wanted to continue the legacy of our grandparents who started with this.”

How the trust intends to run the orchards is not decided.

'That's a decision that's going to be made by the board looking at that particular question on February 1,” says Neil.

They aren't planning to buy any more orchards just yet.

'A purchase of this size will require us to sit back and see how it's going to perform. So there is going to be a period of review around what this looks like. It may be that we look at increasing our footprint in other areas as well, but again those are decisions that will be made by the board. We shall see how this one here rolls out.”

NZ Farmer reports the trust bought five orchards comprising the 66.47 hectare Fernhill properties, marketed by Stan and Chris Robb at PGG Wrightson Real Estate, Tauranga. It is one of the largest sales, by value, of any New Zealand rural property says PGG Wrightson Real Estate general manager, Peter Newbold.

"Many observers will be gratified that this transaction took place between two New Zealand-based entities. Even for sales of this magnitude, locals have the capacity to purchase New Zealand rural property, despite competition from overseas interests," says Peter.

The orchards are in their third year of producing SunGold, and are yet to reach maturity.

"At present about 5-600,000 trays are being harvested, but there is potential to reach up to 1 million trays," says Stan Robb.

Located 12 kilometres north-west of Hastings, the orchards were developed over 20 years ago. They have artificial shelter, frost protection and irrigation.

At just over $700,000 per canopy hectare, the 66.47-ha Hawke's Bay sale is slightly cheaper that an earlier purchase of a Te Puke kiwifruit orchard, which went for more than $800,000 per canopy ha.

Prices for gold kiwifruit orchards have soared in the past two years, from $450,000 per ha in 2015 and leaping to $600,000 per ha last year.

In response to global demand for the SunGold variety, Zespri has been steadily releasing more licences to grow it. Kiwifruit growers have paid out a median price of up to $200,000 per ha each for licences to the sought-after variety.

Zespri forecast that the release of 400 ha of SunGold licences in 2017 and successive releases could boost kiwifruit exports by $500m by 2020. Total green and gold earnings for 2016 are set to hit almost the $1 billion mark.

Zespri's chief operating officer Simon Limmer say the co-operative interpreted the sales in light of the reception SunGold had enjoyed with customers and consumers around the world.

"We're forecasting SunGold volumes to double over the next five years to 90 million trays to meet this strong demand, backed by up investment in marketing and in-market development. Orchard sales reflect the confidence of the New Zealand industry in this great new product," says Simon.