Zespri’s warning over China production of pirated New Zealand-bred gold fruit

Zespri-branded SunGold kiwifruit is a global best-seller for New Zealand. Photo / Supplied

Kiwifruit marketer Zespri is warning the problem of rogue production in China of New Zealand’s best-selling gold fruit variety is growing.

The company estimates production in China of what it calls “unauthorised plantings” of New Zealand-bred and developed G3 gold fruit is now 40 million trays, of which 20 million trays are equal to Zespri first-class quality standard.

For context, Zespri exported a total of 190 million trays of kiwifruit this record season, of which 124 million trays were SunGold.

China is an important market for Zespri – 20% of New Zealand kiwifruit is sold there. China and Japan are Zespri’s biggest export markets.

Zespri, New Zealand’s biggest horticulture exporter, owns the rights to SunGold, or G3, and growers in this country pay hundreds of thousands of dollars per hectare each year for a licence to grow it.

A grower took clippings to China in 2016.

Zespri estimates 8387ha of unauthorised G3 plantings are now in the ground in China.

“Though we consider that the rate of planting has slowed, with less successful local growers switching to other varieties or land uses, overall production is increasing, as more of the plantings reach maturity,” the marketer said in an industry update.

“While it continues to be challenging to identify where all the UAG3 [unauthorised G3] is going, including in which cities and channels it is being sold, where possible Zespri continues to collect intelligence on sales of UAG3.

“Some UAG3 is being sold under competitor brands for 60-70% the price of Zespri Gold3 [SunGold brand], some through e-commerce platforms, some with counterfeit Zespri packaging and/or blending with genuine Zespri product – the most lucrative – and some is exported to other markets in Asia.”

Zespri said it is successfully using Chinese legal channels in its efforts to protect the Zespri brand but this will not lead to plantings being removed.

Those efforts have included working with local authorities to successfully prosecute three individuals in China recently for online sales of locally grown fruit with counterfeit Zespri labels to the value of more than $700,000.

The offenders were each sentenced to three years and nine months in jail and ordered to pay a fine of 550,000 yuan ($125,000).

Another successful judgment earlier this year was against an online seller who received a three-year non-custodial sentence and a fine of 20,000 yuan.

Zespri’s civil case in China to address unauthorised Gold3 plantings continued, said the marketer, which has the statutory right to export all New Zealand kiwifruit except to Australia.

The Minister of Trade and Agriculture Todd McClay and grower advocate body NZKGI have been approached for comment.

“We have also been operating a verification of origin audit programme since 2020 which tests where Zespri-branded fruit was grown, providing an opportunity for commercial consequences if China-origin fruit is found in Zespri packaging in authorised channels.

“We continue to work to understand the impact that unauthorised plantings have on New Zealand growers and our market position, and we will continue discussing our response with industry.”

Andrea Fox joined the Herald as a senior business journalist in 2018 and specialises in writing about the $26 billion dairy industry, agribusiness, exporting and the logistics sector and supply chains.