Bay's $300m Ginseng revolution

A new horticulture industry, based on an ancient crop that has strong healing qualities, is poised to create up to 400 seasonal jobs and inject $300 million a year into the Western Bay economy.
Forty million high-value ginseng plants are growing under the shadehouses of three farms on either side of the Kaimai Range.
The plants - their roots have been used as a herbal remedy by the Chinese for at least 4000 years - take six years to grow and the country's first commercial crop of dried ginseng will be ready for export in 2009.
Tauranga-based Ginseng NZ, aiming to be the world's leading organic supplier, has planted so many rows that they have attracted the interest of the United States military's satellite tracking system.
The inquisitive military, wondering what lies underneath the green shadehouses, has made 40 hits on the Ginseng NZ website.
"They are checking us out - I'm quite flattered," said Ginseng NZ managing director Brian Sage. Placed end to end, the shadehouses would stretch 257km - that's from Tauranga to Warkworth, north of Auckland.
Mr Sage, a former kiwifruit grower at Omanawa, began experimenting with ginseng - which is difficult to grow - 13 years ago.
He and three other shareholders worked quietly and patiently with Crop and Food Research to discover the secrets of producing healthy ginseng roots, normally grown in North America and Korea.
They invested $15 million and planted their first commercial crop in 2003. Ginseng is now growing on 120 hectares at Fitzgerald Glade on State Highway 5 near Tirau, further south toward Putaruru, and on the Tauranga side of the lower Kaimais.
Ginseng NZ, established in 1998, is also developing another 80ha of leased farmland at the top of Pyes Pa Rd and will be sowing 60 million more seeds there this summer. The failure rate is about 20 per cent.
Mr Sage said ginseng grew superbly in the Bay because of the climate and free-draining volcanic soil. In North America, the plants have to be grown on raised beds.
Ginseng NZ, which is now seeking up to $12 million from new investors for further development and extra plantings, did not go public until it was confident it had the complex growing system under control.
"There are 20 critical success factors. Get one wrong and you are out the door. But we've got it sussed," Mr Sage said.
The company wants to finish up with 400ha of ginseng - harvesting 80ha and planting another 80ha each year - and is confident the world markets, valued at between $5 and $8 billion, will easily take the premium-priced, six-year-old organic product.
"It's the 21st-century horticulture, no doubt about that," Mr Sage said.
"There's no reason why we can't have a $300-$500 million industry right here in the Bay.
"It can be as big as the New Zealand wine industry."
Each ginseng root sells for between $6-$15 depending on its weight. Ginseng NZ aims to export a minimum of 300 tonnes a year and receive at least $350 per kilogram bag.
Canada produces 2300 tonnes and United States 1900 tonnes. The company will build three processing plants - it takes 28 days to dry the whole ginseng root - and will produce value-added products such as tea bags, capsules and body lotions.
More than 400 people will be employed, most of them seasonal workers but also a permanent contracting team of 20 putting in the posts and shade cloths.
Ginseng is known to increase energy levels, relieve stress and keep the mind alert. It is used as a medicinal herb and a health supplement in tea, sports drinks and cosmetics.
Even the world's leading brewery, Anheuser-Busch, is putting ginseng into its beer.
Crop and Food Research scientist John Follett, who worked alongside Mr Sage and his team, said the active ingredients of ginsenosides and panaxosides gave the plant its medicinal properties.
He said ginseng's high price on international markets, despite increased production, had created worldwide interest in the crop.
New Zealand growers could command a market niche if they grew larger, older roots.
Mr Follett said one of the main constraints in the traditional growing areas overseas was disease, causing growers to harvest the roots at a younger and smaller stage.
Rob Jeffrey, Bay of Plenty Export Institute president, said Ginseng NZ's plans were exciting for the Bay.
"It's great to know there are companies around prepared to take on a big challenge and I wish them well.
"They have made a large investment but ginseng has strong appeal in parts of the world and hopefully they can develop a niche market.
"I first came across it 30 years ago in Southeast Asia - but all I knew was they boiled the root, chopped it up and drank it," Mr Jeffrey said.