"Obviously they're disappointed but I think there was an acceptance that sooner or later they were going to be in this position. The infected orchard is very well managed and the growers have, in my opinion, done everything correct to keep Psa out."
The disease spread through the moving of plant material between orchards, including new plants and budwood, or contaminated equipment. The disease could also spread up to 10km on the wind or through bees.
The Whangarei industry directly employed about 200 people year-round, with numbers swelling considerably during the harvest season.
Mr O'Neil said last season had seen record kiwifruit production in New Zealand, despite Psa.
Northland MP Winston Peters said the Government was spending $8 million less on biosecurity this year than was spent seven years ago.
Adjusted for inflation, that was $30 million less in real terms. He said more should be done to prevent outbreaks like the one in Whangarei.