VegFed Tomato Sector Chairman, Tony Ivicevich

March 2005

Episode 4: Tony Ivicevich

Roger: Joining me now is VegFed Tomato Sector Chairman Tony Ivicevich. Tonys been growing tomatoes in his North Auckland green house for 25 years. But now he and other green house growers are worried the industrys future is at risk from crippling Kyoto Protocol Carbon Taxes.

Tony , how did green houses growers get mixed up in the Kyoto Protocol?

Tony: We are very high users of energy in terms of gas, diesel and electricity, and coal of course.

Roger: What sort of costs are you expecting?

Tony: Were expecting some very high costs and Ive done some calculations here. Petrol 4.5 cents to 8 cents a litre, diesel 5.5 to 10 cents per litre, electricity 6 to 16%, gas 9 to 24% and coal 17 to 44%. Thats based on a range of Carbon Tax levels that they havent announced yet.

Roger: And whats that going to mean in dollar terms?

Tony: It will range between 12 to $15 000 a year.

Roger: For you? Whos going to pay for that? Are we going to end up paying more for capsicums or tomatoes in supermarkets?

Tony: Probably not. Were in an industry and a business where were unable to pass our costs on.

Roger: What can be done?

Tony: Not a lot, apart from relying on the opportunity that the governments presenting to us for the negotiated green house agreements.

Roger: Thats a break on taxes is that right?

Tony: Thats correct. The latest is that it can be full or partial exemption.

Roger: Tony , youre also chair of VegFed's Climate Change Working Party. Whats that group doing?

Tony: Well, firstly were working with climate change office. Were been very proactive with undertaking projects measuring our industry, looking at ways that we can reduce emissions and dealing with the carbon tax.

Roger: Are these taxes compulsory?

Tony: No theyre not. This is a domestic policy, theyre not compulsory under Kyoto, its just a tool. One of the number of tools that can be used to reduce emissions.

Roger: Kyoto is about reducing emissions. Will these taxes do that?

Tony: Not for those that are dependant on energy use. If you have to use it, you have to use it. It seems that our trading partners Australia and USA have managed to work out other ways. The carbon tax is a domestic policy and a fairly blunt instrument.

Roger: Your competitors in Australia arent paying any of these taxes. What sort of pressure will that put on you with imported product for example?

Tony: Its pretty difficult to pass charges on into a pretty competitive market.

Roger: Could we expect to see perhaps more imported product replacing that what was previously grown in NZ?

Tony: Well, with the rising dollar and extra costs going on to us, yes I do.

Roger: Do we risk driving the industry offshore?

Tony: Very much so. There are a number of larger operators who have voiced that.