Some meat firms prof­itable

South Waikato News - - NEWS -

Fed­er­ated Farm­ers’ pa­per on the meat in­dus­try’s fu­ture pro­moted myths and failed to recog­nise that some com­pa­nies were thriv­ing and prof­itable, a Waikato meat in­dus­try leader says.

Green­lea Pre­mier Meats’ man­ag­ing di­rec­tor Tony Egan said the fed­er­a­tion’s dis­cus­sion pa­per suf­fered from a ‘‘one size fits all’’ ap­proach that could trans­fer all of the risk to farm­ers.

‘‘There has to be room in this de­bate for in­no­va­tion – farm­ers are look­ing for pro­fes­sion­al­ism from their meat processors. They don’t all think there is a need for whole­sale change.

‘‘A lot of dairy and beef farm­ers in the North Is­land have a dif­fer­ent out­look than the sheep farm­ers of the South Is­land.’’

Green­lea had sev­eral new col­lab­o­ra­tive ven­tures in the pipe­line, Egan said.

This sug­gested there was cause for celebration in the in­dus­try and that it is not nec­es­sary to change the whole in­dus­try struc­ture to achieve more in­no­va­tion and build pros­per­ity.

‘‘ While some com­pa­nies still have big de­ci­sions to make on plant util­i­sa­tion and prof­itabil­ity, there are those that have taken the chal­lenge and are op­er­at­ing very suc­cess­fully un­der the cur­rent com­pet­i­tive en­vi­ron­ment.

‘‘Maybe it makes sense for some con­sol­i­da­tion in some ar­eas, but com­pe­ti­tion is not all bad. It drives premi­ums and in­no­va­tion.’’

Re­leased ear­lier this month, Fed­er­ated Farm­ers’ pa­per Meat In­dus­try Op­tions can­vassed is­sues such as a Fon­terra model and toll pro­cess­ing, which sep­a­rated pro­cess­ing and mar­ket­ing within the in­dus­try. It also dis­cussed trade­able pro­cess­ing rights, which is a sys­tem sim­i­lar to one that is used in the fish­ing in­dus­try, and an An­zac ap­proach for mar­ket­ing and re­search.

The farmer group was seek­ing feed­back on the pa­per from their mem­bers so the or­gan­i­sa­tion could write a strat­egy where re­form would be cen­tral.

The be­lief that there was no money be­ing made in the meat in­dus­try was a myth, Egan said.

Green­lea recorded above bud­get prof­its last year and has been grow­ing and prof­itable for 20 years.

It has in­vested $45 mil­lion in re­search and de­vel­op­ment and in­no­va­tive tech­nol­ogy in the past five years to main­tain growth and prof­itabil­ity.

It has an an­nual rev­enue of more than $ 280 mil­lion and em­ployed around 450 peo­ple.

It has 250 cus­tomers around the world in­clud­ing the United States, Ja­pan, In­done­sia, Korea and Canada. Its big­gest ex­port mar­ket is the US, and it also sells to New Zealand cus­tomers.

Egan said there were other meat com­pa­nies that were as equally prof­itable.

‘‘I wouldn’t re­gard us as the ex­cep­tion, I think there is a num­ber, par­tic­u­larly in the smaller space where small to medium com­pa­nies are do­ing OK.’’

He said half of the so­lu­tion to im­prov­ing the in­dus­try was recog­nis­ing the prob­lem.

Fair­fax NZ


CLOSE TO THE BONE: Some plants have taken big steps on us­ing plants prof­itably but oth­ers have yet to make the tough choices.

Tony Egan

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