Zespri responds to monopoly barbs

More than 100 million trays of Zespri kiwifruit were exported this season. Photo / Alan Gibson

Kiwifruit exporter Zespri is defending its record in the face of criticism by Turners & Growers that industry rules are outdated and monopolistic.

Turners & Growers chairman Tony Gibbs, speaking at this week's annual meeting, said the company exported 11.7 million trays of kiwifruit in 1987 - the same year the Government established the Kiwifruit Marketing Board and prohibited the company from exporting.

"I believe the time has come to challenge this outdated monopoly," Gibbs said.

Monopolies were a thing of the past, usually inefficient and slow to react to changing market conditions, he said.

"This is a disgraceful protectionist action which will ultimately disadvantage growers."

The industry has operated a single-desk system in export markets since 1987 when the Kiwifruit Marketing Board became responsible for marketing New Zealand's crop.

The majority of growers voted then to exclude numerous exporting firms because of a perception they were undercutting each other in overseas markets and consequently reducing orchard returns.

Zespri International won its single desk exporting status in 1999 when the kiwifruit industry was restructured. Under legislation sought by growers only Zespri or those exporters with a collaborative contract can legally sell kiwifruit in overseas markets other than Australia.

Zespri director of corporate and grower services Carol Ward said the company was owned by the growers and the industry was successful.

"I guess the key for us is over the past 10 years we've doubled in volume, doubled in export value and we're looking to double again in the next 10 years," Ward said.

"We're proud of our results, we deliver value back to New Zealand growers."

Zespri earns over $1 billion a year in export revenue and is widely regarded as New Zealand's most successful fruit exporter.

There were 2700 growers, 10 registered suppliers and more than 80 pack-houses, Ward said.

"So there is an intense level of competition within New Zealand but the growers have agreed to make sure that the kiwifruit sold offshore goes through a single point of entry into the markets because that for them delivers them the most value back."

Turners & Growers chairman Gibbs evoked history, arguing his company gave kiwifruit its name and pioneered its marketing.

Turners & Growers first proposed the phrase "kiwifruit" in 1956 - but did not seek a trademark or other intellectual property protection for the branding - and by 1987 was responsible for 25 per cent of New Zealand's kiwifruit exports.

The company had interest from markets outside of the Zespri distribution network, Gibbs said.

"Offshore retailers are crying out for alternatives and now that Turners & Growers has its own green, gold and red varieties we are in a position to become, once again, a major force in the kiwifruit industry."

- NZPA