Leading NZ – do we need a national strategy?
Our national debate about strategic direction seems endless, but right now it is focused on agriculture.
The backbone of the New Zealand economy is agriculture, but primary industry is not immune to global economic changes.
Our traditional industry is also threatened by seismic shifts in consumer preference centring on health and the environment. According to ‘‘Ecoman’’ Malcolm Rands, co-founder of the Ecostore, 80 per cent of supermarket sales growth is coming from such areas.
Even people working in the sector are concerned we are not responding fast enough. Competitors such as Ireland appear to have stolen a strategic march, and nicked-off with our ‘‘clean, green’’ branding.
Origin Green is the Irish Food Board’s sustainable farming brand which includes dairy. Part of Ireland’s story is the family farm: because it is family owned through generations there is a huge incentive to be sustainable.
Rands says even Australia appears to be outpacing New Zealand as a green producer.
There is a reason for that, Lindy Nelson, chief executive of the AgriWomen’s Development Cooperative, suggests.
‘‘Ten years ago Australia was looking at us in terms of our innovation around agriculture, but they developed a national strategy. Now they are probably starting to inch ahead because we don’t have a national strategy. For more information on how to transform your business, go to
‘‘They are effective and they do work.’’
Claire Nicholson, chief executive of Sirona Animal Health, says it’s time for a shakeup.
‘‘I think the difficulty with the primary sector at the moment, and we are seeing it the hard way, is that we’ve been reliant as individuals on the big machines – Fonterra or the meat companies – to create those new markets for us and to keep up with the consumers’ needs.
‘‘I think what we are seeing now is that we are not. The problem is our farming systems are all geared towards commodity markets.
‘‘We have to change how we farm in order to create new markets. We need to create some good solid partnerships that are brave enough to step outside the umbrella of Fonterra and create their own markets.’’
New Zealand also has a huge opportunity to market ourselves as a grass-based industry.
‘‘We’re not doing that at the moment.’’
One possible explanation is imports of palm kernel extract to boost commodity production.
‘‘I have a philosophical dislike of palm kernel extract,’’ Nicholson says. ‘‘How can we be letting so much of that to come into the country when there are alternatives that are sustainable, that are not damaging natural environments?’’
Nelson also warns that we have to protect our national brand.
‘‘We’ve got to be careful about that because we are not where we used to be 20 years ago.
‘‘There are people who are doing it phenomenally well. People producing grass-fed proteins around the world and [there is] the whole synthetic protein thing happening.’’
Mills says New Zealand is missing a profitable opportunity. Organically produced milk powder is selling for around $14,000 a tonne compared with conventional powder at $3,000 a tonne, he says.
Government has a role in setting strategic direction, as they do in Asia, he says.
Business NZ boss Kirk Hope, however, is not so sure. Governments are usually behind the eight-ball, he says, while exporters are closely connected to their markets and customers.
But so is much of New Zealand business, suggests Rands, who has been talking up sustainability for 15 years.
‘‘It’s kind of like new news to everyone, even today. Sometimes I’m gobsmacked. Business as usual is an easy trap. ‘I’ve always done it this way,’ it’s a real trap.’’