Enza small growers fear GPG's secret agenda
By Aimee McClinchy
Small apple growers believe Enza's new chairman, Tony Gibbs, has a secret agenda to get rid of them and have Enza run only by large, efficient corporate growers.
CREAM OF CROP: Small growers fear there will be no place for them
They believe that behind his public wish to keep a monopoly lies a cold-hearted plan for deregulation with no place for small, reliant growers, only the cream of the crop.
Mr Gibbs, executive director of GPG, has made it clear he wants to introduce efficiencies, thinks small growers have to get larger and not live on subsidies, and should not expect to get the same service and coolhouse prices as larger growers. He has claimed he believes apple growing is a lifestyle and should only be done by owner/operators and not by corporates.
But this latter sentiment has done little to appease the small growers - many of whom rely on Enza's forward funding - who fear the "costs" to come out of Enza actually mean them.
Enza's board review, overseen by Mr Gibbs and his partners in FR Partners, may look at underperforming coolstores and subsidiaries, significant restructures of domestic operations, and a review of the system of progress payments to growers.
"I'm uncomfortable with their distinction between suppliers, or growers, and shareholders," Leon Stallard, a Waikato small grower, said.
"They make it quite clear their interest is with the shareholders and not the growers."
He fears Enza may hike its commission or raise coolhouse rates beyond the small growers' reach.
"Of course we are worried and there are a lot of smallish growers that employ a long list of people."
Nelson growers are particularly worried as there is no Nelson director on the board for the first time in Enza's history.
But Pipfruit Growers chairman Phil Allison said the smaller growers should be more positive. "I think Tony Gibbs recognises he must take the suppliers with him and there is a limited number of big guys."
Belonging to Enza earns growers a premium, he said.
The smaller growers' fears come as the independent lobbyists calling for deregulation insist the smaller growers should be wanting to get out anyway. The Labour Party's primary industry council chairman, Leo Mangos, has said Enza was not "sympathetic" to small growers, who should be allowed to form their own alliances.
Independent Pipfruit Growers secretary Van Howard also rejects arguments Enza's monopoly must be retained to ensure advance seasonal funding - in one form or another - for growers.
Mr Howard said much of the early-seasonal funding was now provided by individual growers themselves until the apples board ships. Customers then assist with bank guarantees and factoring financiers were involved with customer debtors as security, he said. Independent exporters also claim higher returns to growers.
Mr Gibbs is overseas until early October.
Mr Gibbs and his partners, who publicly deny their wish to get rid of the smaller guys, have been joined by a strange bedmate.
Former Enza chairman, John McCliskie, who spent the last 20 years championing single-desk selling and the co-operative, has admitted some growers need to go.
"We have to create the structure where they are allowed to disappear," he said recently. "There has to be some growers that will go out of business."
Comments from our readers
No comments yet
Add your comment:
Dorchester closes $30 million capital raise, applications exceed offer
NZX says it doesn't know why shares have declined
Sky TV to launch $20/month subscription video ondemand service
Cavalier shares drop 10% after profit warning
Sky TV sees annual profit gain of up to 8.6% in 2015, flags new ondemand service
Mark Mountcastle resigns as chief risk officer with Heartland New Zealand
DNZ revalues portfolio up by $10.7 million
Sealegs turns first-half profit as local market drives sales, Brazil opens new doors
NZ trade deficit widens in Sept as lower log, dairy prices weigh on exports
Sky TV signs conditional deal to renew rugby rights; shares gain