2022 – Agribusiness & Trade: Taking the high ground

It’s been a banner year for New Zealand agribusiness with record export returns topping $53.3 billion – the first time the sector has cracked the $50b mark.

This in spite of the impact of the lengthy Covid-19 pandemic.

The results underline why the success of our agribusiness sector continues to underpin the health of the New Zealand economy.
As Ministry for Primary Industries chief executive Ray Smith says, the challenges over the past years have tested the sector. “Our farmers, growers, foresters, fishers, processes and others are doing their best to successfully navigate these… I continue to be impressed with the sector’s resilience.”

In the Herald’s Agribusiness & Trade report we dip into some of the sector’s success stories. Despite a tough winter plagued by heavy rain and floods there is optimism from sector leaders that farmers can get over this “winter of discontent”. There is also realism that all around the world food producers are facing constraints brought about by inflation, supply chain issues and the impact of climate change.

Plant & Food Research leaders outline some of the innovations they are developing so that our successful horticulture industry continues to post successes in changing climate conditions.

Kiwi companies are taking an innovative approach with, for instance, a move to robotics in the meat industry.
At the global level there are concerns the current food crisis spurred by the impact of the Ukraine invasion on crop levels, recession fears and climate change impacts will continue into 2023.

The current climate crisis in China, the result of an extensive heatwave which has dried up rivers and impacted crops, adds to the challenge.

New Zealand has a vital role to play as the world’s population heads towards 9.8 billion by 2050 according to UN projections, up from a projected 8 billion by November 2022.

As Professor Nicola Shadbolt points out New Zealand produces about 2 per cent of global milk yet it is responsible for one-third of what is traded (only 9 per cent of global production crosses borders), similarly a third of sheep meat traded comes from New Zealand and for kiwifruit is it well over 50 per cent.

Agribusiness expert Ian Proudfoot says New Zealand’s food system is configured to deliver high-quality food to the world efficiently and increasing sustainably which consequently the world is prepared to pay premium prices for. But our domestic market lacks scale, struggles to pay export prices and presents local customers with a mix of food of variable affordability from local and overseas suppliers some of which is produced to lower environmental and animal welfare standards that we set for ourselves.

Consequently says Proudfoot, when our domestic food system leaves one million people living in food insecurity and many more dealing with the symptoms of diet-related diseases, like obesity and diabetes, this becomes part of our national story.
This is an issue for farmers, the agribusiness industry and politicians to work through.

Meantime, the push is on for New Zealand’s food producers to gain greater access to markets at a time of rising protectionism.
This is no easy feat when the European Union, for example, has not opened its doors wide to our meat and dairy exports via the recent bilateral free trade agreement that Jacinda Ardern signed in Brussels on June 30.

It’s a mark of Ardern’s commitment to New Zealand’s ‘Opening Up’ that she has led three major business missions this year to promote NZ businesses to markets offshore.

On the Late Show, Ardern (pictured above) even promoted NZ Carbon Zero beef to host Stephen Colbert.

It is possible that she may take a select group of businesses to China later this year to mark the 50th anniversary of relations between New Zealand and the People’s Republic of China.

Enjoy the report.

Fran O’Sullivan

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