WELLINGTON - The recent high New Zealand dollar and diseases are causing huge losses among many of the country's orchardists and winegrowers but markets in China and India were offering hope, the Ministry of Agriculture and Forestry announced Friday.

The ministry's kiwifruit, pipfruit and winegrowing analyses, which form part of its annual Farm Monitoring Report series, showed the relatively high value of the New Zealand dollar against key trading currencies was battering the export-oriented kiwifruit, pipfruit and wine industries.

"Exporters are unable to raise prices high enough to compensate because of competing supplies overseas and options for consumers to substitute products," said MAF senior policy analyst Annette Carey.

Many pipfruit growers suffered losses last year because of the adverse weather and poor returns on late-season varieties sold in Europe.

Despite most markets performing well this year, the high New Zealand dollar would erode export returns resulting in poor financial outcomes again for many growers, according to the ministry.

The outlook for the medium term was encouraging, with potential for market expansion in Asia, particularly China and India, and the possibility of selling apples in Australia for the first time in decades, said Carey.

Meanwhile, global oversupply and tough economic conditions in the main markets had reduced average grape prices for winegrowers by 8 percent.

Vineyards could expect a profit for the coming financial year, but only through cutting expenditure, such as labor costs, said Carey.

"Many expect it will take three to five years to return to more sustainable profit levels. In the meantime, businesses with high debt levels may be forced into asset sales."

The typical kiwifruit orchard business achieved its highest profit level for a number of years, with 54,840 NZ dollars for the year to March 31, thanks to favorable weather lifting yields to record levels.

The typical owner-operated business was projected to see a profit of 33,010 NZ dollars for the year to March 2012, despite increased expenses in fighting the vine disease, PSA.