Growers were demanding that Enza halt plans to deduct NZ$4.50 per carton from what it pays for apples this year (NZ$1=US 41 cents). The deductions are to offset company losses of $50 million on speculative foreign exchange deals begun in the early 1990s, as well as $4.2 million in losses from the abandoning of an all-weather loading facility at the local Port of Napier. Further deductions next year of $2.63 per carton have been flagged for apples produced in the season just ended.

Enza is acting to charge the costs to growers ahead of the loss of its export monopoly, which the Labour-Alliance government recently announced will take effect on October 1. Growers, many of whom hold shares in Enza, are especially angry about the deductions because they thought that $25 million in proceeds from the company's sale of a fruit juice subsidiary last year had been used to wipe out the debt.

"Everybody's going bankrupt," said grower Bernie Cacciopoli, who gave up supplying Enza recently and now sells his fruit through a roadside stall. He explained that many growers are unable to meet their debts to the packing houses, resulting in one large packing house being placed in receivership this year as a result of bad debts. Many also cannot afford pruning, which is usually under way at this time of year, he said. He explained that with returns on apples of around $17 per carton, once production costs of around $10 are deducted, Enza's new deduction of $4.50 means that the grower would receive less for quality fruit than if it was sold it for juice.

Orchardist Tony Gilbertson, speaking at the rally, estimated that the deductions would ruin 40 percent of orchards in the Hawkes Bay region. The rally was preceded by several protest meetings that were attended by hundreds of growers in the key Hawkes Bay and Nelson apple-growing regions.

Enza, formerly the Apple and Pear Marketing Board, was set up as a joint stock company last April with shares distributed to growers and a statutory monopoly on exports. This followed stiff grower opposition to attempts by the previous National party government to deregulate pip fruit exports.

Enza is now effectively controlled by two investment companies, Guinness Peat Group and FR Partners, who bought up 36 percent of the shares. Over the past two years low payments to growers--in the context of a worldwide oversupply of apples and falling demand--and the actions of Enza, have led many growers to demand an end to its monopoly.

Last December, 150 growers marched on parliament in Wellington to protest low returns and demand loosening of export regulations to allow more independent exporting of fruit. Apple growers are currently required to obtain a permit to export independently of Enza. The new plans to remove these export restrictions, while welcomed by many growers, have met with mixed reactions, reflecting concerns about the impact of competition especially on smaller producers.

Opposition members of parliament from the National and Act parties have taken the opportunity to claim to champion growers' demands. Nicholas Smith, a member of Parliament from the city of Nelson, called on growers at a meeting in Hastings July 3 to "unite and take control of the export business from corporate investors," the New Zealand Herald reported.

Meanwhile, Minister of Agriculture James Sutton has expressed concern about the viability of the apple industry if the dispute is not rapidly settled. A report issued July 21 by his ministry showed that horticulture is now the country's fourth largest export earner, with apples the second biggest earner behind kiwifruit.

Felicity Coggan is a member of the National Distribution Union.
 
 
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