New Zealand’s $1.2 billion kiwi fruit industry was under threat from a virulent vine disease previously un-known in the country, according to the government.

Growers feared the bacteria PSA was the kiwi fruit equivalent of a foot and mouth disease outbreak in the cattle industry, Radio New Zealand reported.

The Ministry of Agriculture and Forestry said tests had confirmed that diseased vines at an orchard in the North Island were infected with PSA, which causes the plant to rot from the inside and excrete brown ooze.

New Zealand supplies about 30 per cent of the world’s kiwi fruit and Agriculture Minister David Carter said the discovery of PSA could hurt export markets.

“This bacteria has the potential to upset trade but we need to be cautious and calm ... this is not the time to panic,” Mr Carter told Radio NZ.

He said it was not known how PSA arrived in New Zealand and industry meetings were held around the country Tuesday to discuss ways to contain it.

Biosecurity New Zealand said the disease, which is not a risk to human health, was first discovered in Japan about 25 years ago and has since been found in Korea and Italy.

New Zealand’s largest kiwi marketing company, Zespri, said vines may need to be uprooted and burned in an effort to control the disease.

Zespri chief executive officer Lain Jager said PSA in Italy had slashed crop yields by up to 50 per cent but the disease had proved less harmful in Korea and Japan, with a minimal impact on production.

“We just don’t know how this is going to play out in New Zealand,” he said.

Originally known as Chinese gooseberry, New Zealand growers began marketing kiwi fruit under its current name in the mid-20th century, according to the Zespri website.