Time For ‘Unfair’ Kiwifruit Monopoly To Go - Poll

18 April 2011
News Release

Time For ‘Unfair’ Kiwifruit Monopoly To Go - Poll

The Government should repeal Zespri's monopoly on the export of kiwifruit and promote free trade for all New Zealand kiwifruit exporters, say more than two-thirds of New Zealanders surveyed in a new nationwide poll.

The phone survey conducted by Colmar Brunton's Consumer Link Research found that nationally 85% of respondents say the Government should be promoting free and fair trade for all New Zealand kiwifruit exporters, as it does for other New Zealand exporters, and 82% say that in light of the PSA outbreak Zespri's monopoly should be repealed and growers should be allowed to export other exporters’ varieties.

The survey commissioned by Turners & Growers also found that 73% of respondents believe Zespri's monopoly is unfair given New Zealand wants other countries to practice free and fair trade.

The poll also revealed concern that a New Zealand company, originally granted monopoly powers to protect New Zealand kiwifruit growers, retained those powers while planning to grow kiwifruit in competing countries. The majority of those polled (62%) said the Government should repeal Zespri's private kiwifruit monopoly given Zespri wants to grow kiwifruit in China and other countries which compete with New Zealand kiwifruit.

Unlike Fonterra in the dairy industry, Zespri is not a cooperative owned by growers, but a private company. Shares in Zespri are not linked to production, with many as many as 30% of growers unable to get shares in the company they are forced to supply fruit to. The poll found 72% of New Zealanders believe it is unfair for a private company and its private shareholders to reap the profits from an entire industry.

The survey results back the call from the Government's own Taskforce, which is calling for Zespri's monopoly to go. In its 2009 recommendations to Government, the 2025 Taskforce didn't accept the Government's excuse for inaction, that it would continue to prop up the monopoly as long as kiwifruit growers supported it. The Taskforce stated that: “We are not persuaded by the test that the monopoly should only be removed when a majority of growers favour such a change. It is not clear what public policy interest would justify a Zespri monopoly that prevented, say, 35 percent of growers who wished to do so from selling their fruit abroad through other companies. The vines and the fruit are private property: in successful market economies governments need a compelling public interest case to constrain property rights in such a way.”

Turners & Growers Chairman, Tony Gibbs said "as a country championing free trade, New Zealand had to be 'squeaky clean' when it came to its own affairs and yet it has the world’s last remaining statutory monopoly, Zespri. New Zealand kiwifruit growers and owners are banned by their own country from exporting fruit which they own."

In a letter to all MPs (attached), which included the poll results, Mr Gibbs said, "As the Southland Times Editorial recently stated: New Zealand, which lives or dies on its ability to tap into large overseas markets, champions free trade and consequently must be beyond reproach when it comes to such matters. Turners & Growers agrees and, as shown by this poll, so do New Zealanders.

"We cannot ask other countries to remove trade barriers when all New Zealand kiwifruit growers are forced to sell through Zespri, and owners of non-Zespri kiwifruit varieties are banned from selling their fruit anywhere but Australia and New Zealand. New Zealand growers should have the right to choose which fruit they grow and who they sell to, especially considering there are now numerous innovative new kiwifruit varieties, while Zespri still only markets two."

The telephone poll was conducted by the independent research firm Colmar Brunton’s Consumer Link Research unit and surveyed 503 respondents nationwide between 29 March and 4 April 2011.
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