The future of Nelson’s apple industry could be in doubt.

One of the country’s top businessmen is predicting that within five years the region won’t have a viable apple export industry.

Former Kiwifruit Marketing Board chairman, and current chairman of Air New Zealand and Solid Energy New Zealand, John Palmer, says matters have reached the stage where many orchards are more valuable without their trees.

John Palmer, who has horticultural interests in the region, says  it would be 'less of a cash drain, growing grass than growing apples'.

" Well I think that is what growers have to look carefully at and we are looking at that, even on our own family orcharding situation, to say would we be better off not growing apples, rather than continuing to produce.

"When you’ve got operational cash losses, that’s the reality of the business.”

John Palmer says it is a sad reflection on the state of what was one of Nelson’ most lucrative  export industries, which last year contributed about $100 million to the local economy, and employs about 4000 people at the height of the season.

He says orchardists have quietly kept on, expanding and trying to get costs and scale right, but at some point one has to question if that path is viable.

“ I think there has been a general unwillingness to do that and people expect that things will get better.

"Well the evidence of the last two or three years is that you shouldn’t necessarily rely on that."

John Palmer says local growers have been slow switching from traditional European and North American markets to moving into stronger emerging markets in Asia.

He believes part of the problem is that people aren’t prepared to admit how serious the situation has become.

“Well I think that there’s been a reluctance. Individual operators like to put on a brave face on things because firstly, people aren’t prepared to admit that they’re maybe either worse off with their current export and organization arrangements then their neighbors, or an unwillingness to admit that, in fact, their personal financial situation has deteriorated markedly.

"I think now is the time to simply face that and say we need to accept the reality, and the industry needs to face up to that and see what organizational changes need to be changed.”