Trade Minister Todd McClay admits being told by Zespri about China warning

The last kiwifruit of the season are prepared for loading at the Port of Tauranga today before sailing in this file photo.

Trade Minister Todd McClay says he was told Zespri in China was warned about trade implications against New Zealand companies but dismissed it as "unsubstantiated rumour" after Chinese authorities denied it.

McClay has previously said China had not raised the issue with him, including when he was in China last week for meetings with Chinese trade officials. However, in Indonesia today McClay confirmed when he was in China he was told that "an industry body" had raised concerns with a New Zealand company. "Our Embassy subsequently checked this with Mofcom [China's trade ministry]. They've said that have no knowledge of it and have denied it. So it has been put down to unsubstantiated rumour."

Zespri has now confirmed it was the company in question. One of its representatives in Beijing was given "unsubstantiated information" about the prospect of trade restrictions by China and had passed that on to Embassy officials a fortnight ago. A Zespri spokeswoman said it related to "purported industry consultations related to the import of New Zealand agricultural products" and came from an "industry body". Industry consultations are the prelude to non-tariff trade barriers to slow trade exports.

"Outside of this single communication, Zespri has no further information on this matter and reports that Zespri was called in for a meeting in Beijing or was in some way pressured by the Chinese government are false."

Zespri has previously refused to comment on the media reports that New Zealand exporters had been warned of retaliation if New Zealand authorities pursued a complaint by NZ Steel over China allegedly dumping steel in the New Zealand market.

McClay said the Chinese Embassy in New Zealand had also assured trade officials they were not aware of any pending trade sanctions against New Zealand companies.

A spokeswoman for Zespri said it was "heartened" to hear McClay's assurances.

"This is being dealt with at a government-to-government level and we have full confidence in both the New Zealand and Chinese governments on this issue."

China is Zespri's top market with sales expected to reach $500 million this season.

NZ First leader Winston Peters said it was unbelievable Government ministers had not known of Chinese concern.

"After days of obfuscation and denial the Government is now confirming it had knowledge of China approaching New Zealand exporters expressing concerns at legitimate policy concerns back in New Zealand."

He said the Chinese Government had used the threat of "industry consultation" in the past.

"China's threatened 'industry consultation' is shorthand for going outside the 2008 Free Trade Agreement to get its way. They did it on the melamine scandal, and the infant formula production plant approval process. That's how China got control of our infant formula industry in just three years under National."