US food guru at horticulture conference
Roland Fumasi is well-known worldwide for his work for Rabobank’s RaboResearch Food & Agribusiness group.
He understands the consumer-led market that growers are providing for and the challenges around that, so his presentation will be of great interest at our conference and beyond.
He is a proponent of delivering exactly what consumers want - safe, consistent, high quality produce that is good value, but also has a light impact on the environment.
Dr Fumasi is a vice-president, senior analyst and manager for RaboResearch Food & Agribusiness group. Headquartered in Fresno, California, he is responsible for covering and analysing the US and North American fresh fruit and vegetable industries, general California agriculture, and he leads the Fresno research team. He combines a background in agribusiness research with international market development and finance experience in the agriculture industry.
Dr Fumasi gained his PhD in Agricultural Economics at Texas A&M University in 2013. Before joining Rabobank, his career includes research, finance, marketing and executive roles. His research focused on specialty crops and alternative energy (bio-fuel) production, and he produced an award-winning thesis related to specialty crops. He received both his B.S. and M.S. in Agribusiness from the California Polytechnic State University San Luis Obispo (Cal Poly).
RaboBank’s RaboResearch Food and Agribusiness group is a global team of more than 90 analysts who monitor and evaluate global market events that affect agriculture worldwide.
The Horticulture Conference will be held July 12-14 in Tauranga. More information can be found on its website.
On April 3, the company told growers and shareholders that it believed the plant material had been transferred in breach of the company’s licences and plant variety rights (PVRs). In the statement, chief operating officer Simon Limmer said because of the possible fraudulent sale of licence, the breach “could give rise to criminal issues in New Zealand” and that Zespri had passed the information to the New Zealand Police, who were investigating.
The following day, the company announced the results of its latest release of 400 hectares of G3 licence, with growers paying a median price of $235,000 (excluding gst), per hectare compared with a 2016 median for restricted bids of $173,913 (excluding gst). Demand was strong with only a quarter of the 938 bids proving successful.
Given the high price New Zealand growers are paying for G3 licence, and the premium returns for the fruit, the company wants to protect its PVR from unauthorized production.
Zespri says that because the investigation is on-going, it is limited in the information it can release. Dave Courtney, general manager grower and external relations, said that in terms of the G3, the material appeared to have been transferred and planted in about 2012 and the area planted was around 100 hectares. (New Zealand has about 6,000 hectares planted in G3; G9, however, was decommercialised in 2015 because of problems with skin shriveling.)
Asked if any fruit had been produced or sold, Zespri said most of the plantings were very immature and yet to produce commercial crops. “Any fruit sold will likely be a very small volume, and has not been sold as SunGold. We also actively monitor and enforce breaches of our trademark and thus we do not believe that the fruit is being sold as SunGold,” the company said.
Zespri started its own investigation around April 2016 after receiving local information about potential plantings, and confirmed the reports at the end of the year, leading to the police inquiry that’s now underway in New Zealand.
Mr Courtney said the company has been building its networks in China in recent years, not just through its sales and marketing efforts, but to explore the feasibility of growing its fruit in there for local supply.
If confirmed, this won’t be the first unauthorized planting of PVR protected kiwifruit in the country, with plantings of the gold variety Hort16a known to be in China. The PVR on the variety in New Zealand expires next year.
Securing and enforcing PVRs outside New Zealand can be a complex, expensive and politically sensitive matter, according to experts in the field.
In New Zealand, the lead agency for administering plant variety rights is the Plant Variety Rights Office, Intellectual Property Office of New Zealand, known as PVRO IPONZ. Ingrid Bayliss, IPONZ national manager, said that while New Zealand law protects varieties in New Zealand, if a variety needs to be protected in other countries, it can be done by “making application in each country protection is desired, by the variety owner. A variety protected in New Zealand is not protected in other countries unless an application for protection is made and granted in that country under that country’s laws”.
Ms. Bayliss said that China, like New Zealand, was a member of the International Union for the Protection of New Varieties of Plants (UPOV), and that China’s law for the granting of protection for new plant varieties, like New Zealand’s, is compatible with the 1978 International Convention for Protection of New Varieties of Plants.
Wendy Cashmore is the plant varieties manager at Plant & Food Research where she leads a team of seven working on PVR issues, and she says securing PVRs in overseas jurisdictions isn’t easy. “It’s quite a challenging and expensive process so anyone who's a breeder or developer or has proprietary rights needs to think pretty mindfully about what their appetite for investment to gain that protection is,” she said.
A well-thought through PVR strategy for one variety covering a number of countries could cost as much as $200,000, and take several years. She said there were also time constraints of around four to six years from commercialisation within which PVR protections must be acquired.
Ms. Cashmore says while there aren’t many published case studies, it’s quite well known anecdotally that plant varieties seen as offering an advantage have been acquired “not always with the authorization of the breeder or IP developer”. And with companies like Zespri making major investments in developing smart, up-to-date varieties “sometimes the spotlight can go on those more than perhaps other varieties”.
Indeed, in mid-2000, news broke of premium New Zealand apple varieties – Apple variety ‘Sciros’, marketed as Pacific Rose and the variety ‘Sciglo’, marketed as Southern Snap – being grown in Chile, which sparked accusations of international smuggling. Reports at the time also referred to Chinese scientists being caught in 1997 trying to smuggle cuttings of another protected apple variety from Auckland airport.
Deciding whether or not to seek PVR protections and in what countries depends on a variety of factors including where and whether you intend to produce, grow or market your crop, Ms Cashmore said. Strategies can range from the defensive – wanting simply to prevent illicit production – to the more positive – where a PVR holder might want to partner with local operators to grow and market their cultivar offshore.
Similarly, how and whether you take action if illicit production is suspected is equally complex. (Zespri says its G3 and G9 varieties do have PVR protection locally in China, and those rights do not expire until 2036.)
Not referring specifically to the Zespri case, Ms Cashmore said that using PVR protection isn’t the only – and sometimes isn’t the best – way of dealing with suspected breaches.“You can use other contracting tools or branding tools – those kinds of things – in conjunction with your PVR,” she said.
Things are somewhat simpler inside New Zealand. Dave Courtney says sometimes people might overplant, beyond what they’re licensed for, and that has to be corrected. “We’ve got a fairly well defined process we go through here in New Zealand, but that’s completely separate from this issue,” he said.
Ingrid Bayliss, IPONZ national manager, said that in New Zealand it was the responsibility of the plant variety right holder “to enforce their right and take action against potential infringements”. While allegations of theft or fraud would be made directly to the police – as has happened in the Zespri case – the owner or licensee of a PVR could also bring civil proceedings, often referred to as an infringement.
“Cases of infringement being made public against a plant variety right (PVR) are rare in the New Zealand horticulture sector as far as IPONZ is aware,” she said. “It is not unusual however, for IPONZ to hear of situations where a rights holder believes another party is propagating their protected variety without their permission.”
She said IPONZ had also heard of alleged cases “where a variety is being passed off as a protected variety when in fact it is a different variety, and there are on average one or two of these situations a year”.
“These situations don’t appear to go to a court hearing. Industry participants tell IPONZ that anecdotally, it appears the issues are resolved between the parties without the need for court action,” she said.