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Apple Industry In Crisis: Minister

3 July 2001

It was too early to call a ministerial inquiry into the circumstances of ENZA's past losses, Agriculture Minister Jim Sutton said today.

Mr Sutton said there were already several processes underway, which should be allowed to be completed first. These include the invoking of supply contract arbitration clauses which several Hawkes Bay growers are considering, and the Apple and Pear Board's investigation of a possible breach of non-diversification rules caused by ENZA's foreign exchange dealings. The Apple and Pear Board is the independent authority which acts as the regulatory watchdog of the industry.

He said there were several legal opinions around which indicated that ENZA could be breaching its contract with growers by recovering 2002 foreign exchange losses from growers now.

"I expect legal advice of my own on this issue within the next couple of days."

Mr Sutton said the apple industry was in a terrible situation.

"It is very serious. Orchards that should be a hive of activity now are quiet. A significant packhouse in Hawkes Bay has gone into receivership. "

Mr Sutton said growers were shocked by developments and they needed more information.

He said the Government was aware of the great anxiety in the industry and was keeping a close watch on the situation.

"There are some extremely complex issues which growers and industry participants are grappling with. There is a lot happening. But it would be premature for Government to intervene, before existing procedures have run their course."

Ends


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