New Zealand Kiwifruit Growers Inc. (NZKGI) has reiterated its role to monitor Zespri's market behavior, but claims the Chilean industry hasn't provided any information that would enable investigations into alleged unsavory practices. 

On the weekend Chilean newspaper El Mercurio published explosive allegations from Chilean Fruit Exporters Association (ASOEX) president Ronald Bown about New Zealand kiwifruit marketer Zespri.

For those who haven't been following the issue, the accusations not only included claims the single desk marketer had a "monopolistic attitude" with "anti-competitive" practices in Asia and North America, but that this alleged attitude was supported by the New Zealand government. 

The publication also reported Bown and Chilean Kiwifruit Committee president Carlos Cruzat also claimed Zespri executives had visited Chile to address the situation. 

Photo: Pixabay

In recent statements sent to Fresh Fruit Portal, NZKGI and New Zealand's Ministry for Primary Industries (MPI) gave their views on the matter.

NZKGI CEO Nikki Johnson emphasized her organization was an independent representative of her country's kiwifruit growers, and such its role was to ensure Zespri operated in the best interests of growers and in accordance with all laws and regulations.

"Representatives of NZKGI recently visited Chile and met with representatives of the Chilean industry to confirm our role in monitoring Zespri," she said.

"A commitment was made to the Chilean industry that any information that they have regarding Zespri’s performance or behaviour in markets would be investigated by NZKGI as an independent party. 

"As yet, no information has been received to enable NZKGI to undertake any investigations but we reiterate our commitment to ensuring that Zespri is operating appropriately."

A spokesperson for the MPI said the New Zealand Government's regulatory structure that governs the country's kiwifruit exports is consistent with New Zealand's trade obligations.

"Like any other company operating in any market around the world, Zespri has to comply with local laws, including those relating to competition," the spokesperson said.

"Since 2000 Zespri has exported the majority of New Zealand’s kiwifruit to markets other than Australia.

“The New Zealand Government’s regulatory structure that governs the export of kiwifruit from New Zealand is consistent with New Zealand’s trade obligations. 

"Under the Kiwifruit Export Regulations (1999), however, anyone wanting to export kiwifruit from New Zealand to any market other than Australia is able to seek approval from the independent regulator, Kiwifruit New Zealand, to export in collaboration with Zespri."

Johnson highlighted 97% of growers who voted in a 2015 industry referendum supported the structure, and that support continues.

"Growers believe it offers the best opportunity to deliver consistent premium quality to consumers and return value to growers," she said.

"We also believe that the activities that growers fund through Zespri have benefits to the kiwifruit industry internationally and by working together we can maximise the value of the category to all growers around the world.

"NZKGI continues to be committed to building relationships with kiwifruit growers around the world for the benefit of all."

The MPI spokesperson added the New Zealand Government had no equity share in Zespri, and that the company was not a government-owned enterprise.

"Zespri does not receive any trade distorting subsidies, tax advantages, special financing, or preferential access to foreign exchange from the New Zealand Government," the spokesperson said.

"It does not receive any form of support from the government, other than having access to contestable Crown funding for research and development that is available to all companies and industries."

Zespri recognized for Chinese trade

On a more positive note, Zespri won two distinctions at the HSBC New Zealand-China Trade Association business awards held in Auckland on Wednesday night - the China business award and exporter of the year award.

The kiwifruit marketing giant has been exporting fruit to China for over a decade but the past three seasons have seen sales volumes more than double, with sales of more than NZ$400 million (US$283 million) last year.

Zespri chief operating officer Simon Limmer said signing e-commerce and Importer of Record agreements, along with moves to work more closely with larger, quality-focused retail customers, had been key factors to sustain that growth.

"We’re incredibly proud of these awards and we’re delighted we can go back to our growers and tell them our sales strategy in China is thriving,” Limmer said in a release.  

"Our forecasts this season suggest China could overtake Japan as our biggest market for kiwifruit and the potential for further growth is extraordinary but none of this could have been achieved without a lot of hard work and strong vision."

In the release Zespri claimed its brand was the most-recognized fruit brand in the cities where its fruit was sold, and it was expanding into more tier 2 cities, opening a regional office in Beijing and launching regional representation in Guangzhou, Xian and Chongqing.

Zespri now employs over 50 staff in China.

The company has invested heavily in Chinese e-commerce, as well as working closely with key retailers.  Last year, online distributor Fruitday became the first e-commerce retailer to buy directly from Zespri, while JD.com recently set up a flagship store for Zespri Kiwifruit to serve its 225 million consumers.

Limmer said becoming the Importer of Record in China had also made a huge difference to Zespri’s business, mirroring the model used in Japan and major European markets.

"It gives us more flexibility and responsiveness in China and lets us develop those connections with retailers and online consumers," he said.

Zespri is also looking into sourcing premium quality kiwifruit from China with trials in their second year in Shaanxi Province, which could provide 12-month supply to Asian markets in the New Zealand offseason.

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