Friday, March 29, 2024

Zespri to try again for China fruit trial

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Zespri will be working over coming weeks to convince its New Zealand growers a proposed trial with illegally grown fruit in China poses little risk to the industry at home.
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The marketer had proposed to commence a three-year trial in China on growing SunGold fruit as part of its approach to dealing with illegally grown SunGold kiwifruit there.

Zespri staff estimate that over 4000ha of the company’s licenced SunGold fruit is being grown illegally in China. This compares to the 6000ha grown here, and is almost equivalent to all the SunGold fruit grown in Bay of Plenty.

Other approaches to dealing with the illegal fruit to date have included legal proceedings against growers and distributors of the fruit. Last year Zespri had its prosecuting ability boosted by being given special legal status to deal with counterfeit claims. This is shared with other high-profile multinationals, including Disney and Nike.

But Zespri’s bid to run the trial has been declined by the regulatory oversight body Kiwifruit New Zealand (KNZ), on grounds the trial posed “more than a low risk” to the interests of producers in NZ.

Zespri’s China strategic project lead manager Matt Crawford says the trial intended to form one plank of the approach to dealing with the problematic illegal fruit.

“We felt this was the way that offered a pragmatic approach. It is a very difficult environment to eliminate the fruit from, for a number of reasons. They are often on subsistence farms and this offers us the best chance to stop the growth of the plantings,” Crawford said.

The trial intended to produce about 1.95 million trays over a three-year period off about 50ha, starting with 200,000 trays in year one. Zespri sold about 75 million SunGold trays last year globally.

Crawford says the trial was to be reviewed annually, and only be scaled up if it was proving successful.

He says there had been interest from Chinese growers in getting on board with the trial because they recognised the added value that comes from selling a genuine Zespri-branded fruit.

KNZ’s board assessed that the trial did meet one criteria of assessment, in that it would be “likely to enhance performance of Zespri’s core business.”

However, it concluded there were three areas of risk that posed “more than a low risk” to the producers’ interests. These are around fruit quality, food safety and brand reputation.

But Crawford says when placed alongside the risk of leaving 4000-plus hectares of unlicensed crop growing illegally, that was a debatable issue.

“Looking through a commercial lens the risk of doing nothing is significant. The risk with the trial is minimal,” he said.

The trial would have involved working with a select group of Chinese growers to determine if SunGold can be grown to Zespri standards and accepted by consumers with no negative impact upon the Zespri brand.

Zespri already has extensive growing relationships in the Northern Hemisphere, most particularly in Italy where a 20-year partnership has orchardists growing fruit to supply NZ’s offseason and maintain valuable shelf space all year round. 

About 20 million of Zespri’s 170 million trays are sourced from the Northern Hemisphere.

Zespri staff are embarking on a roadshow to further inform growers here about the trial’s intentions, prior to reapplying to KNZ to commence the trial.

Zespri sustainability officer Carol Ward says there is a real concern among growers here about the extent of SunGold in China and a desire to understand what actions are open to Zespri to stop it.

“We will be doing more work on the risk areas, and looking at how we can further mitigate our risk,” Ward said.

Crawford and Ward maintain the risk of doing nothing to try and corral growers under the Zespri label is significant, with prospects the illegal fruit area will only grow in coming years.

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