The grey channels, known as daigou, have been a key vehicle for Comvita's sales into China.
The resellers responded to China's imposition last April of an 11.9 per cent duty on daigou sales by cutting their purchases of honey.
"The inventory buildup in the informal channel was significantly bigger than we thought," said Mr Craig.
"When the tax was imposed it had a bigger impact that we expected."
Last year Comvita signed a 51:49 joint venture with its long-term distributor in China, Shenzhen Comvita Natural Food Co with the aim of strengthening the existing strong links between the companies. It will commence operation in July.
Chief executive Scott Coulter said the joint venture was part of a long-term strategy to rebalance its distribution channels into China and be less reliant on the grey channels.
"One of the things that have concerned us is that if you build a business [on those channels], and then you have regulatory changes, you're really affected," he said.
"We are working through a painful period of channel rebalancing from informal to more formal paths to China. This adjustment period may continue for a few more months and the informal channel business in Australasia remains the largest risk to our short term projections.
Mr Coulter said the company was trying ensure that it did not end up competing against itself.
"We're making sure the joint venture has the opportunity to grow and thrive."
Chief financial officer Mark Sadd said the informal channel was a strategic part of the business and would continue to be, but Comvita wanted to move closer to the consumer.
The long-term success of the China strategy would focus around the joint venture discussion in China.
Comvita was still finalising details of how the joint venture would be treated in the company's accounts, and would be updating the market in the next few months, he added.
Comvita hails 'exceptional' deal
Comvita's recent deal to sell the Medihoney brand to Derma Sciences, Inc. was an exceptional one for shareholders, says chairman Neil Craig.
Not only did the company net $19 million from the sale and retain worldwide rights to use the brand, but US company Integra Life Sciences had subsequently offered to buy Derma Sciences at US$7 per share.
That valued Comvita Derma Sciences' stake at about NZ$11 million, making the total value of the Medihoney and share sale about NZ$30 million, with a further US$5 million over several years, provided certain Medihoney sales targets were met by Integra.
The funds, together with a share placement made to China Resources last October of $21 million, would be applied to debt reduction and then for funding strategic initiatives and potential acquisitions currently under consideration.
The company said its strategic partnership with China Resources was progressing well and would enable it to expand more broadly into Chinese-based distribution of high-quality, premium, healthy food products outside its traditional bee-products base.
This year's honey season has been significantly impacted by prolonged and unfavourable weather conditions, and is expected to impact on Comvita's beekeeping operations and profitability in the second half.
However, the company says inventory levels are high and sufficient to carry it through to 2018.
Company officials said Comvita's strong balance sheet had put it in a strong position get as much quality Manuka honey inventory as possible, as it competes for product in the spot market.
Chief executive Scott Coulter said the poor honey season had shown little improvement over the past month.
"[But] assuming a return to normal weather patterns next year, the operating profit impact of this poor honey harvest will be isolated to this current financial year," he said.
China's daigou channels:
* What does "daigou" mean?: "Buying on behalf".
* Who are they?: Businesspeople buying product from wholesalers outside normal distribution channels and posting it to China.
* How big are they?: They vary in size, with some turning over millions of dollars a year.
