MANAGEMENT
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Transforming drystock operation into a highly profitable farm. PAGE 28
Landcorp chair ready for role. PAGE 21
NEWS Designers carry the flag for New Zealand wool.
RURALNEWS
PAGE 15
TO ALL FARMERS, FOR ALL FARMERS
JULY 1, 2015: ISSUE 587
www.ruralnews.co.nz
Meat promo rethink pamelat@ruralnews.co.nz
THE BEEF + Lamb NZ board will need to rethink its whole strategy as an organisation after the processing companies rejected a proposal for joint in-market promotion, says BLNZ chairman James Parsons. The board will discuss the matter for the first time this Thursday and will need to regroup after the “disappointing” decision by the processing companies, says Parsons. The decision followed two years of focused discussion on setting up a 50:50 funded market development entity. “It is important that we don’t react to being turned down by the industry,” Parsons told Rural News. “It is important we think this through strategically and in the best interests of farmers.” BLNZ will need to consider what proposals it will put forward to the commodity levy vote to be held later in the year, including how much it should spend on in-market promotion in the future. One option could be that the BLNZ ceases offshore promotion. BLNZ currently spends $8.3m in total promotion as part of a $28.9m budget. Some of the promotional budget is funded from reserves, which is “an issue”, says Parsons. About $1.3m of the promotion budget is spent on domestic promotion, at least 50% of which is funded by processors and retailers. The domestic promotion will also be on BLNZ’s board meeting agenda. “We haven’t had a board meeting
since we heard from the industry on their not choosing to work with us on joint promotional entity. We need to regroup as a board.” Until board discussions were held he could not say what they would put to farmers. He says it is fair to say it has sparked a whole strategy rethink by the organisation. “We’re always asking ourselves the question ‘are we doing the best things with farmers’ money to get best returns?’ ” “Promotion has been an ongoing
discussion with industry for years, and in the last two years it has got a lot more focussed. We told the industry we want them to do it jointly because when they invest their own funds there is more accountability and ownership. “The meat companies are the ones transacting in the marketplace and selling the products. The value proposition we put up was about country of origin – telling the New Zealand story. That would be an underpinning story which individual com-
panies would springboard off in running their own commercially focused branded programmes. “So [our contribution] was the underpinning provenance, country of origin components of New Zealand sheep meat and beef.” Initially discussion was about a $15m entity with 50:50 funding, but a few months ago a smaller $8m programme was on the table. It would have had to prove itself. “We sup-
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STOPBANK STRESS Horowhenua organic dairy farmer Murray Moxham and his staff had only minutes to move his 650 cows to higher ground after a stopbank on the Koputaroa steam burst during floods last week. Record rain that hit the area caused the Manawatu River and streams such as the Koputaroa to rise to near-record levels. The water flowed across Murray Moxham’s farm and into his dairy shed and he was unable to get to it. He’d never seen anything like this before. He says he’s fortunate he was not milking, but because he is an organic farmer he couldn’t move the stock to another property. Horowhenua was badly hit during the floods. See more pictures and story p10-11.
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ported that approach but when that was drilled into more recently there was not enough support, on balance, among processors for them to come up with their $4m share. “It was disappointing after all the work had gone into it but it has flushed out a lot of good discussions on how we should do promotions. “One of the outcomes – certainly [voiced by] processors I have talked to – is they will need to raise their
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