Legal guns aimed at export rort

By PHILIPPA STEVENSON

An Australian-owned company is the first to be prosecuted for illegally exporting kiwifruit - a black-market trade costing New Zealand growers millions of dollars.

The Ministry of Agriculture and Forestry has prosecuted Oak Shore Holdings, a five-year-old company registered in Hamilton but owned by Australian James Craig, of Victoria.

Oak Shore is charged with exporting nine containers of kiwifruit between July and October last year in breach of kiwifruit export regulations.

Company Office records show Oak Shore was registered in Hamilton in 1997. Its sole shareholder is Craig, who is also a director of the company with John Vincent Karl, also of Victoria.

At a brief hearing in the Auckland District Court yesterday the case was adjourned until late next month.

The value of the nine containers would depend on the type of fruit and market returns at its intended destination, but could have been between $1.4 million and $4 million.

Grower-owned Zespri International has the sole right to sell kiwifruit in overseas markets other than Australia but legislation does allow other exporters to have collaborative contracts with the main exporter.

All exporters are free to supply fruit to Australia for consumption there.

But growers believe they are losing millions of dollars from blackmarket fruit undercutting legitimate exports which passes through Australia, or bypasses it altogether, on its way to Asian or Middle Eastern markets.

Last year, Bob Shaw, general manager for Zespri's North American and developing markets, said blackmarket fruit had been found in Mauritius, China, Korea, Singapore, Dubai and on Reunion Island.

"Asia is a very important and very good market and this fruit is coming in undercutting the pricing with poorer quality fruit," Shaw said.

"We need to be aware of who [the black marketeers] are because they are ripping off their fellow growers."

It was estimated Tauranga growers alone were losing about $4 million a year.

The kiwifruit industry has supported a single-desk exporting system since 1987 when the Kiwifruit Marketing Board became responsible for marketing New Zealand's crop.

When the industry was restructured four years ago Zespri became the sole exporter.

There have been several challenges to the single desk system, including in 1997 when some Maori kiwifruit growers threatened to export their own produce.

No exports were reported outside legitimate channels.

In the early 1990s, Australian growers threatened to deliberately undermine New Zealand exports to the rest of the world in retaliation against New Zealand fruit in their market, and in 1993 some growers here threatened to export without a licence.