Long way from being out of the woods yet

The sense of calm and normality pervading the country for over three months has been shattered by the latest cases of community transmission the country. Until today New Zealanders have been going about their everyday lives, most of them still with jobs and being paid, at least until the wage subsidy ends, while the major concerns appeared to be what Judith’s raised eyebrows say, which political poll is closer to reality, and how many more people would break out of quarantine. Suddenly the media has a lot more than the election to get its teeth into.

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Falling co-product prices prompt changes

The sale of Wallace Group’s tanning, rendering and composting operations in the Waikato, Northland and Manawatu is the latest step in the consolidation process of what is often termed the fifth quarter of the meat industry. Since it began in the late nineteenth century the industry has had to invest significant capital in facilities which were not just designed to process animals for meat production, but also to dispose of the parts of the carcase left over from its primary purpose, otherwise known as by-products or more politely co-products.  

Regulation risks hindering innovation

The fast pace of regulatory change by the government poses a challenge for farmers trying to earn their social licence to operate.

 

The Emissions Trading Reform Bill and the proposed Essential Freshwater Policy are the two latest examples of regulation which are set to be introduced into law before the Election and will inevitably impose serious costs or penalties on farmers as currently drafted Some provisions run counter to good, common sense farming practices, and the ETR has the potential to side swipe the sheep and beef sector, as it incentivises the conversion of sheep and beef farms into forestry.

Taste Pure Nature one year on

A little over a year since the launch of the Taste Pure Nature country of origin brand in California, Beef + Lamb’s GM Market Development, Nick Beeby, is thrilled with the evolution of the programme. At the start a small number of meat exporters were supportive of what Beeby concedes was initially seen as a B+LNZ initiative, but 15 months later success in targeting specific consumer groups and expansion of the scheme into China have brought increased industry commitment. TPN is now viewed positively as a sector-led strategy and the meat exporters have injected huge momentum and drive in support.

ANZCO achieves a huge turnaround

ANZCO Foods’ 2019 pre-tax profit was $30.6 million on record sales revenue of $1.7 billion which admittedly represents a margin on sales of less than 2% and a return on assets of 3.74%, but it is a huge improvement on the pre-tax loss of $39.1 million in 2018. It is also the third highest profit the company has achieved and its best for 16 years, signalling the benefit of the restructuring programme carried out over the last 18 months which has simplified the business and made it more efficient across the entire operation. Replying to a question about the relative importance of a favourable market and trading environment as against these internal improvements, CEO Peter Conley accepts the market conditions certainly helped, but is adamant the main benefit came from the changes to the business.

Latest coronavirus not the end of the world as we know it

Newspaper headlines driving panic buying in Auckland supermarkets suggest either we are facing an existential threat or, more likely, a small percentage of the population is behaving like idiots, presumably stocking up large in case one Covid-19 case so far means they will have to self-isolate.

Covid-19 a major test for government

Newspaper headlines driving panic buying in Auckland supermarkets suggest either we are all facing an existential threat or, more likely, a small percentage of the population is reacting like idiots, presumably stocking up large in case one Covid-19 case so far means they will have to self-isolate.

Social licence to operate just as important as methane reduction

Amid all the debate about agriculture’s responsibility to meet greenhouse gas reduction targets, and the appropriate levels for those targets, it may seem counterintuitive to claim an equally pressing problem is to earn a licence to operate. Just as great a threat to agriculture’s future is not whether it faces a potentially unachievable government imposed target, but a business environment in which consumers make their decisions based on their perception of the acceptability of the food they eat.

ANZCO confident no repeat of horror year

ANZCO’s 2018 pre-tax loss of $38 million was the worst result in the company’s history. The exporter has traditionally posted a profit, even in difficult years for the meat industry which has always had a chequered history, so it is critical to assess what went wrong and, more important, how to make sure it doesn’t happen again.

Two reports, two different audiences

ANZ Bank’s Red Meat Benchmarking report and KPMG’s 2019 Agribusiness Agenda were both released during Fieldays week and both addressed the challenges facing the agricultural sector and farmers, but that’s just about where the similarities end. The ANZ report focuses specifically on the red meat sector with the objective of providing a stable and consistent basis for assessing and providing options for improving farm performance. In contrast the KPMG Agenda is a much more ambitious document which, in its 10^th iteration, seeks to educate the whole sector on the accelerating speed of change and how participants need to adapt to remain relevant.