16 minute read
Opinion
Summit provided food for thought
Alternative View
Alan Emerson
I SPENT the start of last week at the Primary Industries Summit and Awards conference in Wellington. The conference was about ‘Supporting the Adaptation of New Zealand’s Primary Industries into the Future’ and it certainly achieved that.
The world is quickly changing in an era of covid-19 and the conference not only recognised that fact, but provided some genuine options for NZ going forward.
There were over 400 attendees, which was good to see. Farmers, farming leaders, agriculture businesspeople and officials all mixing and mingling as we do in the provinces.
The programme was excellent, and I learned a lot. There was a good bench of highly qualified speakers giving their perspective of our industry moving forward.
I’ve heard many prime ministerial addresses over the years, but the speech from Jacinda Adern was both pertinent and focused. Much to the relief of the delegates, she made the
From the Ridge Steve Wyn-Harris
FROM the Ridge (FTR): Presidentelect Joe Biden, congratulations on your election win.
Joe Biden (JB): Well, thank you. It was part of a very big team effort, but we are incredibly pleased. It’s great to be talking to you down in New Zealand. I had a great visit there back in 2016 while vice-president and had a good conversation with your Prime Minister just last week. I look forward to a refreshed relationship with your nation.
FTR: I see you are having some trouble with Donald Trump acknowledging his election defeat. His administration is only now point that if a regulation was impracticable or unclear it would be revisited and made workable. She acknowledged the importance of the sector, outlined the issues facing us and discussed both an export led recovery and Regional Comprehensive Economic Partnership (RCEP).
As Feds president Andrew Hoggard said in his vote of thanks, the Prime Minister certainly knew and understood the sector.
The Ministry of Primary Industries (MPI) director-general Ray Smith gave a good review of the future of primary industries. His points that we must increase our water storage, revitalise wool, invest in more research and science, develop new products and improve our trade market access were hard to argue with. He also emphasised that having thriving rural communities was a priority for MPI.
I hadn’t heard our chief trade negotiator Vangelis Vitalis before, and he was impressive. In the unpredictable world of covid-19, it is good to have a person with his abilities representing our interests. With world trade decreasing by 1718%, prices softening and a return to protectionism, we certainly need people with Vangelis’ talents.
Other topics I found interesting was a presentation on the Yili – Westland takeover. I was initially against the sale of Westland Milk, but the presentation convinced me otherwise. Likewise, the Bavarian company Baywa’s investment in T & G.
There was a presentation on Regenerative Agriculture (RA). The talk by Australian RA disciple Dr Christine Jones didn’t inspire me. She made a lot of claims, but proved nothing.
Correspondingly, South Otago RA farmer Hamish Bielski was passionate about RA. I wouldn’t question his commitment, but I don’t agree with his cause. just starting to allow you the odd briefing and he isn’t showing much enthusiasm for leaving the White House.
JB: I think our Secret Service is quite capable of removing trespassers, but I don’t expect it will get to that.
FTR: Happy Birthday as well. I see you turned 78 last week. Let’s talk a little about this. When Trump took office four years ago, he took the title of the oldest president at the time of his inauguration as he was 70. He took that title off Ronald Regan who was 69. Mind you, Regan was a few days shy of 78 when he left office.
But you must go back to 1841 to William Harrison for the fourth oldest at 68. He tragically died a month later, so didn’t get long to experience that high office.
Is your age and mental agility your biggest challenge?
JB: I don’t accept that. Age is just a number and I’m up for the massive challenges facing our country. I’m in the process of
INSIGHTFUL: The Primary Industries Summit had a host of qualified speakers sharing their perspective of industry moving forward. University of Otago professor Peter Dearden gave an impressive rendition of the virtues and importance of modern science which we need to embrace in its entirety. Photo: Facebook/MPI
The session on plant-based diets was good, and convinced me that it has a place in NZ. While I won’t be consuming any of those foods myself, I accept they have a valuable part to play in our total food mix, especially if we accept gene editing and genetic engineering, which are important for plant-based foods and vegan diets.
Exploring the opportunities presented by gene editing to enable sustainable farming was a must-watch. University of Otago professor Peter Dearden gave an impressive rendition of the virtues and importance of modern science which we need to embrace in its entirety.
His position was, simply, that gene editing was vital for the future of NZ agriculture and I agree.
His statement “recognising science and innovation are critical to our response to global catastrophe from covid to climate change” was prophetic.
Canterbury farmer Hamish building a great team to support me. And of course, if the worst were to happen, Kamala Harris is an extremely capable woman. As they say, the VP is but a heartbeat away from being president.
FTR: Well, we saw you jogging across a stage to show how fit you were and Trump leaving his sick bed to campaign. You do know that Harrison mentioned above, delivered his lengthy inaugural address without a coat or hat to demonstrate his vigour, caught a cold and was dead within 30 days. You guys need to be careful.
Obama, Clinton, Kennedy and Teddy Roosevelt were all in their early to mid-forties, as an example of the other end of the presidential age range. However, I guess you could argue that didn’t all go well for some of them either.
Given how close some of those swing state victories were for you, one can’t help but think that if Trump had made a half decent attempt at controlling the pandemic, he might still be president. Marr gave a passionate speech in support of glyphosate. I couldn’t disagree with any of his arguments.
There was considerable discussion on consumer needs and preferences in a postcovid world, which I found interesting. Health and wellness, sustainability, trust and safety, and value all featured. Basically, the post-covid consumer wants a product that is “simple to shop for and simple to cook.”
There will also be a move to premium pre-cooked meals and premium premixed drinks and snacks. Home entertainment will be more important than dining out.
In 2030, successful companies will be those that improve the health of the planet, provide a smart diet and high technology harvests.
Several speakers discussed the needs of the post-covid consumer.
Several also promoted the idea of certification, but the issue I had was that we have
JB: You make a good point but sadly for this country, he didn’t and my team and myself have a big task ahead of sorting this crisis out. We’ve already lost 260,000 American lives to this virus. The experts are saying it could be nearly 400,000 by early next year. By comparison we lost 47,000 lives in Vietnam in combat, 53,000 in WW1 and 292,000 in WW2, so it will be somewhere near the total of these three national tragedies.
FTR: If that were your only challenge, it would be daunting enough. How are you going to draw your country together? Your victory speech was great, and you talked about doing just this but easier said than done.
JB: We must rebuild bridges here. Between the different political parties, across the disparate regions that have completely different world views, between the races and all manner of other differing groupings. But yes, you are right, it will be a massive task.
FTR: Well, it feels like the US several certification schemes, all standalone. We hear about improved traceability, that people need to know the NZ story better, that people should understand that we have good and ethical employment practices.
We heard from both Fonterra and Zespri about their excellent sustainability initiatives.
My view is that we’re doing everything right now, but the international market is largely unaware of that.
The NZ story is fine but that’s all it is, a story.
What we need to do is to have one internationally recognised sustainability scheme along the lines of Ireland’s Origin Green, and to do that will take leadership.
Let’s hope that happens sooner than later. Our future depends on
Your View
Alan Emerson is a semi-retired Wairarapa farmer and businessman: dath.emerson@gmail.com
Congrats on your win, Mr President-elect
it.
is in the process of rejoining the League of Nations rather than the individual isolationist approach of recent years. Given how intertwined most of us are with your economy and culture, it’s good to have you back. Good luck!
JB: Thank you.
Volatility to remain well into next year
Meaty Matters
Allan Barber
THE world is about to mark 12 months since covid-19 made its unobtrusive entrance before wreaking massive havoc with everybody’s lives. The first impact on the agricultural sector was the sudden lockdown in China, which derailed Chinese New Year (CNY) celebrations, causing disruption to consumer purchasing patterns. This came hard on the tail of a slowdown in January because of speculative buying of cheap product which led to a build-up of inventory.
The meat industry had already faced the need to divert product before covid-19 really made its presence felt in China, so the agility displayed by exporters since then was tested as early as February with the peak of the season still to come. It now feels like the right time to ask some of the exporters to predict how they think the market will behave over the first few months of the new year, although my request for a six-month forecast produced an amused, if incredulous reaction. The three major factors affecting business under present trading conditions are customer demand, exchange rates and shipping constraints, all of which lead to a volatile environment.
Volatility is a common
Sarah Perriam
THEY say the devil is in the detail of the National Policy Statement for Freshwater Management that came into force at the beginning of September, but what I uncovered on the West Coast was that the devil was in the delivery.
Parked outside the Farmlands marquee at the AgFest in Greymouth this month, I wanted to get a sense from West Coast farmers on how they were feeling and dealing with a lot of change ahead.
The emotional responses were bewilderment, fatigue and a fear of uncertainty across the half a dozen beef and dairy farmers I interviewed. There was also the constant theme of feeling used as a scapegoat by the current government.
One young farmer told me the story of buying a children’s book for his nephew, which he soon discovered contained images of cows pooping in waterways. He says children come home from school and ask their farming refrain with the discovery of contamination on product in a south eastern Chinese warehouse causing continuing uncertainty. Although New Zealand product do not appear to have been affected, there is some nervousness among buyers, particularly those serviced by Tianjin, where clearance of shipments is being delayed by a requirement to disinfect containers; limited capacity at the port to perform this activity may cause a slowdown.
Meanwhile, China is the “rising tide that lifts all boats,” according to Affco’s Mark de Lautour who expects CNY to produce a lift in trade with only a small drop after the annual holiday. He says the overall situation is more positive than this CNY, with Chinese buyers taking a more measured approach this time, buying what they need instead of speculatively. Anzco’s general sales and marketing manager Rick Walker confirms good demand for lamb and beef in advance of CNY, although he is cautious about the potential impact of a second coronavirus wave and how China would manage it.
While there is nervousness at the border as a result of the warehouse contamination issue, Walker does not expect there to be any political interference. However, the potential for unforeseen political fallout is always a concern, as demonstrated by the Chinese response to the recent Five Eyes condemnation of the Hong Kong situation. And while China will retain its status as the biggest buyer of NZ’s red meat and co-products, there will always parents, “why are you killing the environment?”
While his father shared his fears that New Zealand farming and its social licence to operate is on a similar trajectory to the coal industry, ultimately leading to us having to import all of our food from countries with a more damaging environmental footprint than ours.
“It’s more socially acceptable to dress up in leather and be whipped than feel the pain of being a farmer,” he said.
At Farmlands’ stand, visitors were given a poker chip to place in one of the five boxes with the overarching question, “what change do you fear the most?”
An overwhelming 67% placed their voting chip in the government regulations box. Other options included harsher and drier weather, urban disconnect from the country, rise of veganism and sourcing quality labour.
What was incredible to observe was not only the result from our poll of over 300, but the physical force and conviction the voters be a degree of tension in the relationship, which makes it critical to have a wide range of alternative markets.
Despite the announcement of three successful vaccines in the last week, one of which does not impose extreme cold chain requirements, it will take several months before the level of protection makes a return to some sort of normality achievable. In the meantime, traditional markets, North America and Europe will remain volatile because of the differing impact of covid-19 on the twin trade channels, retail and foodservice. Foodservice has been severely affected by different degrees of lockdown and, therefore, hospitality is unlikely to return substantially until well into the new year in either the US or Europe. Although it has been possible to divert most foodservice products into retail, some high cuts like French racks have no readily available outlet.
The trend away from foodservice to retail, both through store and e-commerce, will continue as long as the hospitality trade is unable to operate normally. Retail, chilled and frozen, has benefited from the increase in home cooking and all main markets are strong, although Lamb Company shareholders report it has been tough to compensate for the downturn in North American foodservice.
Walker says a positive effect of the supply chain problems has been the incentive for a number of consumers to try lamb for the first time, which bodes well for its future popularity. The Taste Pure demonstrated in placing their voting chip in this box.
I decided to then unpack the devil in the detail with the farmers that joined me for a yarn in the front seat of the Ford Ranger to see how government regulations will affect their farming business on the coast in particular. Known for its challenges in farming with 100-plus inches (3000mm) annual rainfall, I wanted to understand the practicality of limiting pugging to a depth of 20cm on the West Coast.
“We will have to pack up and leave. You simply can’t walk across the paddock yourself after a decent 6-inch rainfall without pugging,” they said.
“We try to avoid pugging already wherever we can, as we want to protect pasture to avoid spending money on re-grassing. We don’t need them to tell us a measurement.”
On Friday, November 13, AgFest was noticeably quiet with the farming crowd and I was told it’s because it was the first clear day you could actually get a tractor
EXPECTATION: The trend away from foodservice to retail, both through store and e-commerce, will continue as long as the hospitality trade is unable to operate normally.
Nature programme will reinforce this trend.
Affco, Silver Fern Farms (SFF) and Anzco report strong chilled lamb retail demand for Christmas from UK multiples, while Easter business is currently being negotiated. Brexit does not appear to feature strongly as a threat, although anything could happen between now and December 31. SFF group sales manager Peter Robinson says the exporter has booked good orders from its main Chinese distributor, as well as strong Middle East business for Angus and Reserve Grade premium steer.
Anzco’s Walker also reports good NZ demand for chilled lamb legs at prices comparable to export, providing a more profitable outlet than chilled air freight.
Whereas customer demand depends on several factors that are hard to control, the exchange rate is an even more difficult factor. The NZ dollar has strengthened against all main currencies, none more so than the US dollar, which has declined by more than 10% in a matter of weeks. Our dollar has also firmed against Sterling, the Euro and Australian over a paddock after nearly three solid months of rain.
When it came to the rule that crops must be sown by October 1, the majority of farmers explained that they don’t actually do winter cropping as they don’t have the window to get it back into new grass.
It’s more socially acceptable to dress up in leather and be whipped than feel the pain of being a farmer.
The biggest elephant in the room in particular for the West Coast is the fencing setback changes to 5m from a waterway, as I was told that farming cattle on the coast relies heavily on utilising the humps of a paddock’s natural stand-off pad from the flooded hollows after a decent shower. With the vast isolation of farming dollar by lesser percentages. As meat exporters generally fix the exchange rate at the time of sale, rather than take forward cover or hedge, the strengthening currency inevitably eats into returns.
The third challenge facing exporters is shipping, both availability of containers and container vessels. There is a problem getting empty containers back to NZ to meet demand, while port delays overseas and here mean shipping lines often make late decisions to miss ports or even skip NZ altogether. Shipping departments face a constant challenge to load containers and get them onto a designated vessel in time.
In a nutshell, nothing will be easy for the foreseeable future, prices will struggle to match the last 12 months, but exporters will do the best they can for their
Your View
Allan Barber is a meat industry commentator: allan@barberstrategic. co.nz, http://allanbarber.wordpress. com
What West Coast farmers fear most
suppliers and customers. on the West Coast, these fencing rules made no sense to the farmers I spoke with.
“We have the mountains behind us and the water within 2km meets the sea, what are a few cattle crossing a couple of times a year?” they asked.
When I drilled down into each Coaster’s farming systems, I uncovered a very progressive, efficient use of their natural resources with most farming under the nitrogen cap proposed already due to freight costs and existing farm assurance programmes with their milk supplier and strict annual environmental audits. They shared the reasons they still farm for future generations and the reward of being a custodian of their land.
To take all of this into account and a government consultation process described to me as “nonexistent and impossible to attend at the busiest time of year,” it’s no wonder 67% of voters in our Farmlands poll voted that they fear government regulations the most.
