An economic analysis of a robotic harvest technology in New Zealand fresh apple industry : a dissertation presented in partial fulfilment of the requirements for the degree of Doctor of Philosophy in Agribusiness, Massey University School of Agriculture and Environment, Manawatu, New Zealand

Loading...
Thumbnail Image
Date
2020
DOI
Open Access Location
Journal Title
Journal ISSN
Volume Title
Publisher
Massey University
Rights
The Author
Abstract
The New Zealand apple industry is predominately an export-oriented industry relying on manual labour throughout the year. In recent years, however, labour shortages for harvesting have been jeopardising its competitiveness and profitability. Temporary immigration labour programs, such as the Recognised Seasonal Employer (RSE) program have not been able to solve the labour shortages, urging the industry to consider use of harvesting automation, i.e. robotic technology, as a solution. Harvesting robots are still in commercial trial stage and no studies have assessed the economic feasibility of such technology. The present study for the first time develops a bio-economic model to analyse the investment decision for adopting harvesting robots compared to available alternatives, i.e. platform and manual harvesting systems, using net present value (NPV) as the method of analysis; for newly established single-, bi-, and multi-varietal orchards across different orchard sizes, and three apple varieties (Envy, Jazz, and Royal Gala); and implications of orchard canopy transition and associated sensitivities are considered. The results of the analysis identified fruit value and yield as the key drivers for the adoption of harvesting automation. For relatively low value and or yielding varieties such as Jazz or Royal Gala, robots are less profitable in single-varietal orchard compared to bi-varietal orchard planted with relatively low value and yielding varieties. In a multi-varietal orchard, a relatively high value and high yield variety, such as Envy, is crucial to compensate for the costs incurred for harvesting other varieties using robots or platforms. The greatest potential benefit of utilising harvesting robots was reducing pickers required by an average of 54% for Envy and 48% for each of Jazz and Royal Gala across all orchard sizes compared to manual harvesting; and 7% in average for each of Envy, Jazz, and Royal Gala across all orchard sizes compared to platform harvesting system. This study also identified the break-even price for a robotic harvester in a single-varietal orchard, showed that the break-even prices exceeded the assumed price of the robot, and are highly variable depending on the varietal value and yield, where Envy as a relatively higher value and yielding variety returns a break-even price of $2.92 million compared to relatively lower value and yielding varieties, Jazz with $674,895, and Royal Gala with $689,608. Sensitivity analyses showed that both harvesting speed and efficiency are key parameters in the modelled orchard and positively affected the net returns of the investment and must be considered by researchers and manufacturers. However, for developers and potential adopters of robots, it should be more important that robots operate faster, but not necessarily as more efficient in order to generate a high return while substituting the highest number of pickers and leaving less unharvested fruit on trees in the limited harvesting window. Reducing robot price by 12% and 42% can generate an equivalent level of profit similar to manual or platform harvesting, respectively. Increases in labour wages, and decreases in labour availability and efficiency adversely affected the NPV and profitability outlook of the investment, but NPV was more affected by the decreases in labour efficiency and availability than wage increases. This research has important science and policy implications for policy makers, academics, growers, engineers, and manufacturers. From an economic perspective, for late adopters or those growers who may not be financially able to invest in robots or may be uncertain about their performance, platform harvesting system can be utilised as an alternative solution that is commercially available until robotic harvesting technology improves or becomes more affordable, and commercially available. Alternatively, it may be possible for these orchardists to benefit from utilising the robotic harvester in the form of a co-operative or contract-harvesting business model to avoid the capital costs associated with purchasing and operating the robots. Besides the economic factors, robotic harvesters have the potential to be considered as a solution for non-economic factors such as food safety problems. This is more apparent in the post-Covid-19 pandemic era, which has not only made it more difficult for growers to source their required workers due to border closures, but also has led consumers to be more cautious about food safety when they make purchase decisions and prefer to have their fresh fruit touchless from farm to plate. This may not be a problem for packhouses as most are automated, but it may be an issue for harvesting operations, because pickers have to pick apples by hand. Even though robots cannot be the only option for growers to rely on for the foreseeable future as they are not commercially available, in the current situation robot harvesting may be the most ideal solution.
Description
Keywords
Apples, Harvesting, New Zealand, Automation, Robots, Industrial, Apple industry, Economic aspects, labour, bio-economic analysis, net present value (NPV)
Citation