Kiwis take another Asian fruit to market

Dr Garth Smith (second from right) says BioVittoria has set up a joint venture with the Chinese to commercialise the luo han fruit.

Taking an oversized berry of Chinese origin to the international stage isn't exactly an original idea - the billion-dollar kiwifruit industry is one of New Zealand's greatest marketing triumphs.

But while BioVittoria of Hamilton has similar-sized ambitions for the Chinese fruit luo han, it is following a very different recipe for global success.

For one thing the luo han doesn't make for good eating in its natural state. But dried and made into a tea it has been used as a natural sweetener in parts of China for centuries.

The other difference is that the fruit can only be grown in China.

"What we're doing is taking a cottage industry and applying the technology to create a large-scale commercial industry," says horticulturist Dr Garth Smith.

Smith - one of the BioVittoria founders - is a former HortResearch scientist who played a key role in the development of the kiwifruit industry

His co-founder is Stephen LeFebvre, a US citizen and marketing veteran of the nutraceutical industry.

LeFebvre is based in Hamilton and is managing director of BioVittoria.

He believes there is an enormous worldwide market for the powdered version of the ancient sweetener.

BioVittoria has developed a product called PureLo, which is completely natural, 300 times sweeter than sugar and doesn't contain calories.

Last week, the company got the green light from the US Food and Drug Administration to sell PureLo as a food ingredient, a huge step which will allow access to the multibillion-dollar calorie-free sweetener market.

Right now other major sugar alternatives are either synthetic or are not approved for sale as food ingredients, LeFebvre said.

Just how big a bite of the sweetener sector it takes remains to be seen.

The costs of producing the natural sweetener mean it is destined to be a niche product aimed at premium food products for several years at least. But that should still translate to millions of dollars in revenue.

And after talking to most of the major US food corporations, LeFebvre is confident demand will not be an issue.

BioVittoria has been working with US customers for nine months. The FDA approval will allow those companies to start putting more resources into developing uses for PureLo "because it is now legally feasible", he says. But the big issue is supply.

Smith says that unlike artificial sweeteners you can't just build more factories and churn the stuff out.

Smith is based in China, where the fruit is still exclusively grown. Unlike kiwifruit, the Chinese Government holds overall rights to the luo han itself and it cannot legally be grown anywhere but China.

Smith says the project is not about creating another cash crop for New Zealand but about a New Zealand company being at the heart of a multinational venture to create an exciting new product for the world.

BioVittoria has cultivated a strong relationship with local Chinese authorities and set up a joint venture - called Bio-GFS - to oversee the commercialisation of the fruit.

Although there is a thriving cottage industry of growers who sell the dried fruit, making the step up to a commercial industry is a big one, Smith says.

"Its very much like the early days of the kiwifruit industry in New Zealand."

Despite being in its infancy as a commercial crop BioVittoria will still look to produce between 15 and 25 tonnes of finished product in the next year. That equates to about 100 times that volume in raw fruit.

"So although it's small it's still considerable," LeFebvre says.

BioVittoria does have intellectual property rights to certain hybrid strains of the fruit which have been bred to make it more disease resistant and also enable it to produce fruit in its first year of planting.

The company also has proprietary rights to the process to turn the sweetener into a powder and removing the liquorice-like flavour which is a strong feature of the traditional version.

It is the large seeds in the fruit that make it undesirable to eat, says LeFebvre.

But dried, sliced and made into a tea it is used as a sweetener and as a medicinal drink for sore throats and colds.

BioVittoria is a private company owned by the management team of LeFebvre, Smith, Hamilton-based chief executive David Thorrold and US-based scientist Dr Andy Rubman.

It also has backing from the New Zealand venture capital company Endeavour (which in turn has backing from the Government's Venture Investment Fund).

Purelo

* Derived from the Chinese luo han fruit.

* 300 times sweeter than sugar.

* Contains no-calories.

* Completely natural.