Zespri Group Ltd says this week's court challenge to its statutory grip on exports outside Australasia is wasting its growers' money.GPG subsidiary Turners and Growers Ltd and two of its own subsidiaries last year filed proceedings against Zespri and its
Zespri Group Ltd says this week's court challenge to its statutory grip on exports outside Australasia is wasting its growers' money.
GPG subsidiary Turners and Growers Ltd and two of its own subsidiaries last year filed proceedings against Zespri and its subsidiary Zespri International in a bid to trigger de-regulation of the kiwifruit exports.
On Tuesday, the High Court at Auckland will consider the validity of kiwifruit export regulations giving Zespri a monopoly and whether the High Court has jurisdiction to determine if Zespri has discriminated against potential exporters or failed to allow diversification.
Kiwifruit export regulations provide for anyone to export kiwifruit under collaborative marketing procedures, as long as they can show their proposal is in the best interests of the nation's kiwifruit growers. Zespri's director of corporate services, Carol Ward, said 16 companies, including Turners, were already exporting though such programmes.
The legal challenge was "a wasteful use of grower money," she said. "Instead of concentrating on wasteful and pointless litigation, it would be better for Turners/GPG to work constructively with Zespri," she said.
"If it has serious commercial propositions that might benefit the industry, we would welcome such a programme".
Turners and Growers has previously broken the control of the former New Zealand Apple and Pear Marketing Board and in January 2003 took over the pipfruit grower-owned company Enza.
Now Turners wants to export its own gold, red and sweet green kiwifruit from New Zealand, without having them first assessed in comparison to the returns available from rival cultivars, such as Zespri's.
In November last year the Government's 2025 Productivity Taskforce labelled Zespri as an anachronistic legacy of the old producer boards whose monopoly powers should be revoked. It questioned what level of majority grower backing justified a Zespri monopoly.
But Zespri has sought assurances from Prime Minister John Key that the Government will maintain the Zespri control on exports for as long as growers support it, and the company has framed a longterm strategy around commercialisation of new kiwifruit varieties, with focus on value-added marketing and has said that a "unified collaborative industry structure", coupled with innovative and sustainable orchard practices, will be the key to its success.
The minister who pushed through the 1999 kiwifruit export regulations underpinning the present structure, National's John Luxton, said at the time that a single kiwifruit marketing desk should continue "without a sunset clause".
Observers say Turners and Growers needs to succeed in the initial four-day court case from July 20 to successfully continue a wider challenge set down for a six-week substantive hearing to begin in the same court during May 2011.
Zespri has sales revenue of $1.5 billion from fruit supplied by 2700 growers in New Zealand and 1200 overseas. It employs 250 people. Turners and Growers says it is the nation's largest corporate horticulture investor and a large-scale grower of several fruit varieties including citrus, apples and kiwifruit.
