The Independent Kiwifruit Growers Association (IKGA) has called on marketer Zespri to explain why it is licensing the G3 variety for free in Italy when it has tendered licenses in New Zealand for upwards of NZ$45,000 per hectare and the cultivar is now fetching up to NZ$130,000 on the free market.

A Zespri spokesperson told www.freshfruitportal.com European growers paid a higher rate of commission for the gold cultivar instead of an upfront license price, but the company would not disclose the rate as the information was "commercially sensitive".

In a statement, IKGA spokesman Ted Meade likened the policy in Europe to a "handout paid for by New Zealand growers and taxpayers", as the government had been spending NZ$35.7 million since 2009 on a kiwifruit breeding program run as a joint venture between Zespri and Crown entity Plant and Food Research.

"New Zealand growers, on top of the licence fee, have to pay a 3% royalty on net sales of which 1.35% goes to Plant and Food Research. Zespri has been very quiet about what commission rate Italian growers are paying," Meade said.

The IKGA urged Zespri to disclose the commission rate, but doubted the marketer would for three reasons.

"First, because NZ Growers might finally realise that the royalty income their promotions money is generating (around NZ$1 a tray taken from all growers who by law have no choice but to supply Zespri) is accelerating for the benefit of the 28% of Zespri shareholders who own 75% of the Zespri shares and not to ordinary growers," the group said.

"Secondly, because taxpayers might question why they are not getting a fair share of the return on their investment and why their funding of variety development is being used for the benefit of Italian growers and to privilege a minority of growers who own most of Zespri's shares.

"Thirdly, because it might highlight to Italian nurseries and breeders that this scheme is not driven by anything other than a desire to shut out competing kiwifruit varieties in Italy and amounts to a State Trading Enterprise dumping a NZ taxpayer subsidized variety in the Italian market," the group alleged.

The IKGA highlighted the Jingold organization introduced three new varieties at the 2013 Macfrut Conference in Italy, of which two were yellow-fleshed - Jinyan and Donghong. Additionally, it has licensed large plantings of the Jintao variety (marketed as Jingold) and other yellow-fleshed varieties are present in the country such as Soreli, A-19 (marketed as Enza Gold), Y374 or JB Gold (marketed as Kiwi Kiss) and Dori.

The IKGA said it would be reasonable to expect Italian licensees and breeders like Jingold might complain to their government that this action by Zespri allegedly amounted to dumping of a subsidized kiwifruit variety in their backyard in breach of World Trade Organization (WTO) rules.

"Zespri is a State Trading Enterprise under WTO rules and has been notified as such by the NZ Government", the IKGA said.

The Zespri spokesperson said the company was looking to build its 12-month supply strategy to increase its product presence on shop shelves year-round.

"To do this, we need more growers in the Northern Hemisphere to plant SunGold," she said.

"Rather than charging a licence fee upfront offshore, Zespri charges a higher rate of commission. Anyone growing Gold3 outside New Zealand is obliged to supply Zespri exclusively with Gold3, and they are therefore required to pay the Zespri commission.

"The amount paid by offshore growers over time is similar that paid as NZ growers, who pay a lower rate of commission with an up-front licence fee. As I’ve said before, these commission rates are commercially sensitive.

She said profits from Zespri's global supply business were valuable source of corporate dividend returned to New Zealand grower-shareholders, with profits of NZ$9.9 million in 2013-14.

"Supply volumes and revenues from Zespri Global Supply are set to grow strongly in coming years, which is good news for the New Zealand kiwifruit industry."

www.freshfruitportal.com