Project will identify marketing potential of regenerative agriculture

Earlier this year before lockdown B+LNZ announced its intention to conduct research into consumer attitudes to red meat produced using regenerative agriculture practices. This project has now been bolstered by an injection of financial support from MPI’s Sustainable Food and Fibre Futures fund and the involvement of the wine industry’s Bragato Research Institute which is keen to discover any potential for improving vineyard management, as well as evolving brand messaging across the wine industry.

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Decades of dietary advice misguided

For at least the last 40 years international health guidelines have recommended minimising intake of saturated fats contained in red meat, dairy, cocoa and palm oil in a mistaken attempt to improve public health, particularly in first world countries. Heart disease skyrocketed to become the leading cause of death by 1950 and scientists hypothesised the cause to be dietary fat, particularly the saturated variety.

Time for sector to find united voice

Several organisations with an interest in the future of our agricultural sector have come out with strategies or visions for what needs to be done to find New Zealand’s place in the sun. One such report produced by the Primary Sector Council has been sponsored, one could say hijacked, by the government, and converted by MPI into a set of financial and environmental targets. Another is the result of independent research and consultation. Ideally either the government will engage with the primary sector to agree the best policy settings the industry believes necessary to meet these ambitious targets, rather than insisting on following the plan it commissioned to meet its own priorities.

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.

Differing responses to wage subsidy scheme

The country’s meat processors have followed two distinctly different paths in response to the government’s wage subsidy scheme which is available to all businesses for 12 weeks, providing they can substantiate a 30% drop in revenue during the period. Silver Fern Farms, Alliance, ANZCO, Taylor Preston and Blue Sky Meats have all claimed the subsidy to varying extents, whereas AFFCO, Greenlea and Wilson Hellaby have decided it is not justified or necessary, at least partly on ethical grounds.

Overseas markets holding up

In a recent conversation, Alliance CEO David Surveyor described world red meat markets by comparing them to traffic lights. Contrary to the evidence earlier in the year, when buyers stopped buying because of Chinese New Year closely followed by the Covid-19 shutdown, China has emerged as the brightest light with the traffic lights firmly set on green. The composition of Chinese orders has changed since the virus outbreak with retail and online sales growing considerably, while there are signs of hot pot outlets starting to reopen.

Ritchie instrumental in driving positive change for red meat sector

Tim Ritchie came into the Meat Industry Association as CEO at the end of 2007, initially intended to be for an 18 month period, and retired earlier this month over 12 years later. His first task was the planned merger of the processor representative organisation with Meat & Wool, the forerunner of Beef + Lamb NZ, which was strongly promoted by Keith Cooper, then CEO of Silver Fern Farms, and Meat & Wool chairman, Mike Petersen.

Meat industry in better shape today to cope with downturn

When I started to trawl through possible topics to write about this week, I had the bright idea it might be worth asking meat processors what contingency plans they have in place in case an employee, more particularly one on the processing floor, tests positive for the Covid-19 coronavirus. So far my research suggests it’s not yet an issue that has received a great deal of consideration by many companies, although it’s certainly on their radar.