The red meat sector’s Primary Growth Partnerships (PGPs) are making good progress in the bid to add value to this country’s red meat.
The latest edition of Agri-Gate, the Ministry for Primary Industries (MPI) PGP newsletter highlights progress in two of the sector PGPs, the Marbled Grass-Fed Beef programme and the Red Meat Profit Partnership (RMPP), which are really starting to roll now.
This shows the Marbled Grass-Fed Beef PGP is now five years into its seven-year programme of activity, having started in August 2012. The programme is led by partners First Light Foods and Brownrigg Agriculture, working with MPI, and uses Wagyu genetics to produce highly marbled grass-fed beef with superior eating qualities.
In key export markets, premium beef is still mostly produced from grain-fed cattle grown on feedlots, however consumer demand continues to show strong preferences for grass-fed, free-range, premium beef, fuelling growth within the global grass-fed meat category.
Wagyu beef, which originated in Japan, is well known internationally for its highly marbled quality and, coupled with New Zealand’s natural growing environment, the programme aims to position marbled grass-fed beef globally as a prized, high-quality, ‘centre of the plate’ meat.
“Farmers gain certainty of income with fixed price contracts on the back of a growing demand from finishers and international markets. This presents a great opportunity for farmers to diversify their earnings,” says First Light chief executive Gerard Hickey.
Using the best genetics
Critical to the programme is the supply of Wagyu genetics. Wagyu Breeders Ltd (WBL) is the New Zealand Wagyu breeding-stud owned by programme partner Brownrigg Agriculture. WBL uses a range of full-blood Wagyu genetics originally imported from Japan and supplies the genetics for the First Light Grass-fed Wagyu programme, enabling First Light to currently operate as the largest commercial producer of grass-fed Wagyu cross animals in the world.
As well as Wagyu crossed with traditional beef cows (predominantly Angus), mating dairy breeds with Wagyu sires has provided a growing source of high-marbling beef. Supporting the programme’s recent focus on dairy integration, an exclusive supply agreement with New Zealand’s leading dairy herd improvement company, LIC, has been instrumental in growing a secure stable supply of Wagyu x dairy calves.
Dr Paul Muir from On-Farm Research continues to lead the research and ongoing improvement activities within the programme. Valuable data has recently been analysed from completed progeny trials. This trial data will be used to further enhance performance of feed and farming systems and provide a basis for future genetics planning and improvement.
Engaging committed farmers
Developing an integrated supply chain from ‘farm to plate’ is the cornerstone of the Marbled Grass-fed Beef PGP programme. More than 300 farmers are now involved in the First Light Wagyu programme, including dairy farmers, calf-rearers, growers and finishers. Farmer numbers have increased significantly in the South Island where processing has recently started to support this growth and maximise logistics efficiencies.
Continuing to build the producer group model, where regional hubs of farmers co-operate in the rearing, finishing and supply of animals, remains an important factor to the overall success of the programme.
The programme has also provided a solution for utilising calves from the dairy industry. Many dairy farmers have already proven success in using First Light Wagyu to provide a sustainable and economic alternative to bobby calves, and are proud to be part of a programme promoting animal welfare within the industry.
Russell and Charlotte Heald milk 430 cows in a family operation in Norsewood. They are now into their second year of rearing Wagyu-cross calves, taking them through to finishing.
“We use Wagyu semen to A.I. our mixed age cows to better utilise our calves. The impact has been huge. We’re half way through calving and have only sent three bobby calves away. It makes good sense to utilise what is being produced and diversify at the same time and add to the cash flow.
“Within two years, a third of our income will come from Wagyu beef,” says Heald.
Bringing the product to market
At the marketing end of the supply chain is a dedicated team ensuring First Light’s grass-fed Wagyu beef is consistently meeting consumer demand. In November 2016, First Light launched its retail range into New Zealand supermarkets and demand continues to be strong in the local market. The US remains the company’s largest market with new products recently launched including burger-patties and hotdogs. The UK and Europe also continue to be significant customers for First Light grass-fed Wagyu.
First Light’s general manager sales and marketing, Jason Ross, says, “If the first five years were all about creating a truly differentiated product and supply chain in New Zealand, the next five are all about building a distinct and defendable position in the global market. We have learned and embedded the key disciplines to be a globally competitive FMCG business, now we have to execute well and bring the value home to New Zealand farmers and stakeholders.”
Challenges for the future
Significant growth is forecast and systemising and communicating the learnings in the supply chain is a key focus as the PGP programme moves into its final two years. This year, First Light is marketing approximately 5,600 cattle, while concurrently planning matings to meet processing targets of 20,000 cattle in three years’ time. It also remains important to ensure there is a long-term sustainable offering from First Light Wagyu to attract farmers.
Further growing the presence of grass-fed Wagyu in targeted global markets will help build on the programme’s success to date, and consolidating supply chain integration will ensure the industry partners are well equipped to maintain momentum beyond 2019 when their PGP programme ends.
Learn more about First Light at www.firstlight.farm.
RMPP making good headway and delivering initiatives
John Parker, chair of the PGP Investment Advisory Panel, notes the 2010 Red Meat Sector Strategy estimated up to $880 million a year in additional farm revenue is possible by 2025.
“We’ve got no doubt this is an ambitious longer-term target, but the RMPP is already making good headway and delivering initiatives that give our red meat sector the best possible opportunity for success now and long after the programme ends,” he says.
Among other things, RMPP has identified the key things the top performing farmers do, worked to actively engage a lot more women in their farming businesses and carried out research into extension methods, which is guiding better ways to get farmers to adopt best practices.
“The key determinant of RMPP’s success will be getting a large number of red meat farmers – they are targeting 3,000 – to participate in this new apporach to achieving adoption of best practices,” says Parker, pointing to the newly launched RMPP Action Network to roll this out across New Zealand.
Other work includes DataLinker, developed in conjunction with the Transforming the Dairy Value Chain PGP, that will make it easier for farmers to use and aggregate data from multiple sources for farm management and industry performance benchmarking purposes. Electronic Animal Status Declarations (eASD), the NZ Farm Assurance Programme are other initiatives, that will be vital to underpin Beef + Lamb NZ’s development of the Red Meat Story, while new schools resources are aimed at drawing young people into the industry and an online Knowledge Hub gives farmers somewhere to go to find information.
“RMPP provides examples of the benefits of collaboration between PGP programmes. While PGP programmes cover a wide range of different areas, there are definitely lessons that are transferable and MPI and programmes are making sure they’re captured. This kind of collaboration simply wouldn’t have been possible without the PGP,” comments Parker.
In other PGP news, another of the red meat sector’s Primary Growth Partnership programmes, the Omega Lamb PGP led by Alliance Group, is a finalist in four categories of the 2017 New Zealand Innovation Awards: Innovation in Agribusiness & Environment; Innovation in Food & Beverage; Innovation Excellence in Research; and Export Innovator of the Year.
You will be able to find out about all this and more at the Food and Fibre Innovation ‘Innovation – from Vision to Action Conference in Wellington, New Zealand on 30 November. Early bird registrations close on 20 October 2017. Find out more here …