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A Waikato mushroom growing operation has been forced to close - with the loss of more than 160 jobs - because of the cost of fixing obnoxious smells from its composting plant.
Morrinsville-based NZ Mushrooms, a subsidiary of Christchurch-based Meadow Mushrooms, has faced more than a decade of neighbours' complaints over its "vile and gut-wrenching" odours.
The company has been tied up in a court battle over resource consents, and had to design improvements to control smells from its Morrinsville composting plant, which is 3km from its mushroom farm.
Meadow Mushrooms chief executive Roger Young said yesterday the cost of the remedial work to satisfy conditions imposed by the Environment Court would be "dramatically more than had been anticipated".
"Despite every effort and significant investment being made over the last five years, the cost required is now so extreme that it is not economically viable."
The company had asked the court to allow negotiations over the orderly closing-down of NZ Mushrooms.
It was hoped to arrange a managed exit from the site by the end of 2010, but it would be up to the court, Mr Young said, and it could direct a much earlier closure.
"After 54 years of operation it is very distressing to see this business forced into closure with the effective loss of over 160 jobs.
"Since purchasing New Zealand Mushrooms some years ago [in 1995], Meadow Mushrooms has spent in excess of $2 million attempting to remedy the concerns of neighbours."
Neighbours have variously described the smells as "vile and gut-wrenching" and "like a rotting fish."
Tony and Janet Gray's farm is next to the composting plant.
Mr Gray said they wanted the composting works to be enclosed and said the amount the company spent on odour experts in court, which he estimated was $400,000, could have been spent on enclosing the plant in the first place. "We have tried to work with the company, to suggest ways and things that they could do to fix the issues and they have refused to work with us."
He alleges constant breaking of resource consent conditions since 1995 when NZ Mushrooms took over the composting business from an owner who worked well with the community.
A retired farmer, Mr Gray said he doesn't feel responsibility for the job losses. He said he blames the local and regional councils for not monitoring the company closely enough, which put the environment, the wider community and ultimately jobs at risk.
Matamata-Piako Mayor Hugh Vercoe said the mushroom farm was a large employer and while a pending closure was not out of the blue, it came at a bad time.
"There are possibly other jobs here, but this is not the economic climate when those other employers are looking at taking on extra staff."
He said the composting site had been where it is for longer than some of the residents on lifestyle properties nearby, but the court had ruled on the offensive odour and the company had no option but to comply and try to work towards an orderly closure.
"I would support a phased close-down [over] shutting the doors all at once," Mr Vercoe said.
Meadow Mushrooms, part-owned by former National Party Cabinet minister Philip Burdon, says it is one of the two largest producers in Australasia.
- ADDITIONAL REPORTING: NZPA