Canned fruit freeze exemption supported

Press, 31 December 1982, Page 3

Canned fruit freeze exemption supported

PA Wellington The Government has supported the recommendation of the Industries Development Commission that canned fruit be exempted from price control. The matter would be referred to the Commerce Commission, the Minister of Trade and Industry, Mr Templeton, said yesterday. The report, completed in October, had noted that with Closer Economic Relations with Australia (C.E.R.) it ■ would become cheaper to deliver products from Australia to Auckland than from Christchurch to Auckland. New Zealand canners might have difficulty competing with importers in the largest domestic market in Auckland, and therefore prices should be allowed to drop there, while rising in smaller and more distant areas. .The report expressed concern about the "real possibility”- of canned fruit being dumped on the New Zealand

market. New Zealand canners were worried that stockpiles of canned fruit in Australia could find their way into New Zealand at unrealistically low prices. Mr Templeton said the Government agreed with the commission’s recommendation that all imports of canned fruit be monitored and action taken to prevent dumping. He said the Customs Department had established a monitoring policy including a domestic value check list to detect any overseas market fluctations. The Government also agreed with the commission that canned fruit should be included in C.E.R. and also supported the majority view of the commission on the amounts to be issued by global tender, Mr Templeton said. “A portion of the tender amounts will be allocated to the domestic fruit canners. Tendering will be over a three-year period followed by a five-year phase-out of

import licensing. Canned bepry fruit is to be become licence-on-demand.” However, the Government declined two of the commission’s recommendations for support for the industry. Plant and machinery used for export fruit would not be exempted from 10 per cent sales tax and the recommendation that the industry be accorded the 40 per cent investment allowance from plant and machinery used for export fruit was also declined. A decision on whether canned fruit should be exempted from the 150 km transport restriction was deferred. The report said the New Zealand canned fruit industry’s production value was $26 million a year. Exports were worth $3.7 million last year, of which $2.3 million was canned kiwifruit. Recommendations agreed to in the report became operative from January 1. . 1983, Mr Templeton said.