Growers turn up heat on Enza's $25m

By PHILIPPA STEVENSON

Otago apple growers heading a campaign to overturn an Enza decision to renege on a $25 million capital distribution have laid an official complaint with the industry's regulatory body.

Pipfruit Growers Otago forum member Stephen Darling said the complaint to the Apple and Pear Board alleged the marketing organisation was discriminating between groups of growers.

The charge follows last week's decision by Enza to reward this season's suppliers with an extra $1.20 a carton, instead of paying lump sums to last year's suppliers, who will become shareholders after deregulation on April 1.

The money from the 1998 sale of Enza subsidiary Frucor Beverages was promised at least three times to growers.

Many were expecting to receive as much as $100,000.

Mr Darling said Enza's handling of the situation created widespread dissatisfaction and generated strong criticism of chairman John McCliskie's leadership of the board of directors.

But Mouteka grower Paul Heywood said fault lay with the new export permits committee, which allowed independent exporters to sell fruit to Enza customers.

"By default we are getting multiple suppliers of fruit," he said.

The committee's policy of approving only permits which were complementary to Enza was either not being followed, misunderstood or misrepresented.

Mr Heywood said the committee's work had to be challenged.

He preferred a single seller, but would rather have total deregulation than continue with a system which allowed some exporters to "cherry pick" at the expense of Enza and the rest of growers.

Mr McCliskie said criticism by British supermarkets, including Tesco and Waitrose, that Enza was not meeting their needs, obliging them to seek permits for other supply, arose because the retailers could not get enough small apples.

"Last year we had the biggest size fruit we have had in years," he said.

"The previous year we had a [smaller] 13 million carton crop because of El Nino, so there weren't enough apples to go around for anybody let alone Tesco and Sainsbury.

"We can't turn Mother Nature off. So they have gone to get growers specifically to grow the little apples for them."

He warned that this year there would be a huge crop of small apples which could result in a flood "of little apples in Britain which don't have any other homes to go to."

Mr McCliskie said his board had taken legal advice on the distribution of the Frucor money before "making the hardest decision of my career."

"But as directors we have to keep the company strong for the future.

"In the current environment, we simply cannot pay $25 million here, write another $5 million cheque there."

Enza suppliers benefited equally.

"The ones with the export permits don't, but they are not making any contribution to anything so I don't think they are disadvantaged either. So it brings it into balance."

Mr McCliskie said Enza had just been rated top marketer in the world apple review for the fifth year in a row.

"Our premiums overseas are 40 per cent higher than anybody else's, and that's what we've got to focus on. That's what the business is about."

Calls for his resignation were not new "because I'm elected to be a director to make the best calls on the information at the time.

"This job is not about being in a popularity contest."