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Market will cope with extra lambs

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The market should be able to cope with the expected one million more lambs this season, suggests meat industry commentator Allan Barber.

Responding to recently released figures from B+LNZ Ltd’s Economic Service Barber points out that last year’s 4.4 percent reduction led sheep numbers to an all time low and that this season saw a bounceback of 2.6 percent, largely from an increase in ewe hoggets.

“Providing adverse weather doesn’t cause larger than anticipated lamb losses, there is every reason to expect one million more lambs on the ground this season,” he suggests, adding that this will prompt the question as to whether the markets can absorb the extra lambs, given the flat state of most overseas economies and the significant amount of inventory clogging up the pipeline.

“Past experience suggests that the pipeline will free up, so buyers will hopefully start to place orders again in the not too distant future. In addition, the growth last season meant that farmers held back stock and continued to put weight on. At the same time, meat exporters failed to give the right market signals soon enough, because they had to keep prices high to secure throughput,” explains Barber.

“Assuming the law of climatic averages reasserts itself, the coming season will return to more normal conditions. Therefore, the conflicting messages of procurement and market price will not be so far out of kilter again and supply and demand will be more complementary.

“If not, we will have to pray for an outbreak of rational behaviour from producers and processors!”

Barber notes that the changing nature of land use in New Zealand can be seen from the fact that the North Island is now home to more sheep than the South Island for the first time in living memory. At the same time, the South Island, assisted by irrigation, now has 35 percent of the country’s dairy cows, “a proportion which was inconceivable 15 years ago,” he says.

 

Nearly quarter of a billion being invested in red meat

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Nearly a quarter of a billion dollars is being invested by the meat industry and the government in projects aimed at adding a potential $3 billion to returns over the next decade.

Ministry for Primary Industries (MPI)’s director-general Wayne McNee took the opportunity at the Red Meat Sector Conference to announce approved funding for the latest Primary Growth Partnership programme, which will enable the production of high-value marbled grass-fed New Zealand beef for premium export and domestic markets.

The initiative will develop marbling in grass-fed beef in the New Zealand beef herd, using Wagyu beef genetics, McNee explained. “MPI will invest in this programme with Brownrigg Agriculture and Firstlight Foods. The PGP is committing $11 million over seven years, for a programme worth a total of $23.7 million.”

Marbling, the distribution of fat through meat, is a primary determinant of quality in table beef in international markets such as Japan, China and the United States. Internationally, such high quality beef is produced mainly from cattle housed in pens and fed grain. ANZCO Foods has been producing a supply of hand-selected steers for Japan, raised on grass but finished on Canterbury grain at the Five Star beef feedlot near Ashburton for over 20 years.

To produce a comparable meat fed using New Zealand grass, the new PGP programme is aiming to develop an integrated value chain for the beef. It will combine high marbling Wagyu sires for the yearly mating of dairy heifers and cows and the development of rearing and grazing systems that will support year-round growth of the cattle.

McNee said the programme aligns well with the Red Meat Sector Strategy.

“The programme will produce unique New Zealand high-value beef for discerning consumers. It will link specialists in dairy farming, cattle breeding, finishing, processing and marketing and deliver market signals effectively right through the value chain,” he said.

David Brownrigg of Brownrigg Agriculture says it will be a significant opportunity for beef and dairy farmers to lift the quality and value of their calves and finished cattle.

“The New Zealand dairy sector represents an under-utilised resource for producing quality beef calves. Brownrigg’s Wagyu crossed with ‘Kiwi’ dairy cows and Angus beef cows will produce outstanding beef and help us lift our game in international markets,” according to Brownrigg.

Gerard Hickey, managing director of Firstlight Foods says a planned marketing programme to selected high-end global consumers will enable beef farmers to build their businesses with confidence.

Minister welcomes announcement

Welcoming the announcement, Minister for Primary Industries David Carter says, “The Government’s total investment so far of more than quarter of a billion dollars in PGP programmes, demonstrates its firm commitment to boosting economic growth through primary sector research and innovation.

“All New Zealanders stand to gain from the partnership because, alongside our internationally prized lamb, our beef sector is pivotal to the success of our economy.”

The announcement lifts the total government-industry PGP spend over the past three years to nearly $600 million. Nearly $86 million of government PGP funding has been allocated to three meat industry projects worth a total of nearly a quarter of a billion dollars to date. These are estimated to potentially put over $3 billion more on the country’s GDP by the mid-2020s.

To date, PGP-supported meat projects include funding of up to $59.5 million over seven years for the $151 million Farm IQ project with partners Silver Fern Farms, PGG Wrightson and Landcorp Farming aimed at creating a demand-driven integrated value chain for red meat. Seven project streams and 18 sub-projects are working to improve the capture and utilisation of both market and farm production information. The information will then support the development of new value-driven genetics and extension work that underpin the programme.

Another $36.6 million PGP project with NZ Merino, including $15.15 million of PGP funding, is looking to develop merino sheep with meat, wool and other products suitable for market demands over the next seven years.

Also in the wings, is a project that has been approved to business plan stage and will potentially to be funded to the tune of $37 million, led and matched by funds from Beef + Lamb NZ Ltd focused on implementing a number on-farm elements of the Red Meat Sector Strategy. Other meat industry projects are also in the pipeline, according to MPI.

The PGP is expected to be fully subscribed by next year, says McNee.

An abridged version of this article appeared in Food NZ magazine (August/September 2012).

Delivered: second Red Meat Sector Conference

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Delivered, as promised: Excellent, inspirational and thought-provoking speakers, all appearing in a packed programme for the 250 delegates attending the second Red Meat Sector conference.

Congratulations must go to the Meat Industry Association (MIA) and Beef + Lamb NZ Ltd (B+LNZ), joint organisers of this year’s well-attended Red Meat Sector Conference at Rydges Lakeland Resort hotel in Queenstown.

Alongside heartening optimism for future demand for red meat, recurrent themes were the massive potential for New Zealand of emerging markets in Asia, especially China, water issues, the need to utilise best practice, the need for all links in the chain to tell the industry’s story to the public, plus the rapid emergence of social media as a tool for communicating with consumers.

In his opening comments, MIA chairman Bill Falconer also noted that, while not as quickly as some would like, encouraging progress is being made on the Red Meat Sector Strategy and that “small starts are being made across the board.” Later in the day Rob Davison, from the B+LNZ Economic Service, outlined a number of matrices that the Economic Service is developing that will help to track progress against the strategy, and these matrices will “focus conversations, thinking and actions to drive the future”.

The Conference also saw the announcement of new Primary Growth Partnership (PGP) funding for the red meat sector, for a project to develop high-value grass-fed marbled beef, using Waygu genetics.

All the presentations were a veritable smorgasbord of information, packed with facts, statistics and views from many facets of the industry, enabling delegates to pick out what was relevant for their part of the value chain. While every single one of the speakers was passionate and eloquent about their topic, from an export food manufacturing perspective the highlights were excellent presentations from McDonald’s Arron Hoyle and vertically integrated meat processor Agri Beef’s Rick Stott from the US.

Besides the serious business, there was entertainment and laughter too. Lunch – finger food featuring B+LNZ Ambassador chef Ben Battersbury’s speciality “alternative cuts, not cheap cuts” like lamb riblets –  was amusingly heralded with witty comments from him. After dinner speaker Davey Hughes of Swazi Apparel gave an hilarious account of hunting expeditions in Africa and shared a few (tongue-in-cheek) items from his latest collection, including a new ‘mankini’.

Also noteworthy, was a significant Australian presence at the conference in the form of representatives from Meat & Livestock Australia and Aus-Meat. This put physical form to MLA’s managing director Scott Hansen’s opening comment in his presentation that “Australia sees a close collaboration with New Zealand.”

There was positive feedback from delegates, who came from all parts of the sector, including farmers, processors, equipment suppliers, researchers and media.

This article appeared in Food NZ magazine (August/September 2012). Copies of most of the conference presentations are available at www.mia.co.nz or redmeatsector.co.nz.

 

Stock numbers holding

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The good pastoral production year has seen New Zealand sheep numbers increase by 2.6 percent and beef cattle numbers increase by one percent for the year to 30 June 2012, according to Beef + Lamb NZ Ltd’s Economic Service.

“This partly makes up for the 4.4 percent decline in sheep and 2.6 percent decline in beef cattle the year before,” says executive director Rob Davison.

B+LNZ’s annual stock number survey, which establishes the productive base of livestock for 2012-2013 shows that while sheep numbers were up 2.6 percent most of this increased will be stock carried over for slaughter in July-September.

Ewe condition is good across the country, he noted. “Scanning results for most regions show in-lamb ewes are carrying more multiple lambs with the general comment that scanning percentages are up five to 10 percent on last year. All we need now is an excellent sprint to ensure high survival of the lambs born.”

The scanning results lead to expectations that the 2012 lamb crop could be up on last Spring by one million lambs (+ four percent). This outcome would lift the ewe flock performance measured by lambing percentage to around the highest achieved, which in 2009-2010 was 123 percent. There is potential to exceed this performance level, Davison says. Each one percentage point change in lambing percentage, equates to about 200,000 lambs.

 

 

 

 

 

The future is bright

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The future looks bright for New Zealand’s red meat export business, if you go by the presentations at the recent Red Meat Sector Conference in Queenstown.

Over 250 delegates, drawn from processing, farmers, service companies, shippers, economists, and government officials, crammed into the Rydges Lakeland Resort hotel on Monday 16 July for an absolutely packed itinerary of presentations from 17 excellent speakers – several of them from overseas – all with inspirational and thought-provoking messages.

The veritable smorgabord of information, mustered back into its time slots by some able session chairmen, revealed recurrent themes of massive potential for New Zealand meat in emerging markets in Asia, especially China, water issues, the need to engage in best practice, to tell the industry’s story to the public and the rapid, mind-boggling change the emergence of social media has wrought on getting those messages out there.

The first early shoots of progress on the Red Meat Sector Strategy (RMSS) were evident too, not as fast as some would  like, but it’s a start. Nearly a quarter of billion dollars of industry-government money is being spent on re-shaping and vertically integrating some parts of the red meat chain over the next seven years through Primary Growth Partnerships (PGP) programmes. These are alone forecast to add somewhere in the region of $3 billion to the country’s GDP by the mid-2020s. Meanwhile B+LNZ Economic Service’s team, under the guidance of Rob Davidson, have been developing a natty set of matrices that will enable industry to see how it is progressing along the Strategy’s path (more of that later).

Delegates will be picking out of it what they need. They were certainly upbeat and eager to hear more right to the last speaker of the business sessions, Nigel Latta, who talked about behavioural change and how to make it.

There is no doubt that more is bound to come from discussions at conference and later. Well done to the joint organisers, the Meat Industry Association and Beef+Lamb NZ Ltd.

A more full report will appear in Food NZ August/September 2012 magazine in early August and MeatExportNZ will be covering other items emanating from the conference over the coming week or so. You can find most of the presentations already up online at the MIA website, along with the programme.

 


In the news this week (2) …

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There was plenty going on at the Red Meat Sector Conference in Queenstown this week, but there were also a few other things appearing in the press. 

China eyes up top-end lamb cuts, writes Tim Cronshaw, in an article about Alliance Group sensing growing interest from its Chinese customers in some of the higher value cuts, rather than the lamb flaps traditionally used for hot pot dishes.

B+LNZ Ltd held it’s ‘Farming on the Edge of Science’ Day at Massey University on 11 July.  Dominion Post farming editor, Jon Morgan, was in attendance, alongside the farming participants. His report (Science day teaches farmers new tricks, 19 July) makes good reading and shows how farmers were shown the latest in pastures and forages, management and new technology and animal production in a series of three workshops (this is not available online as yet).

 

German festival-goers flock to eat New Zealand lamb and venison

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New Zealand lamb and venison were in such hot demand at Northern Europe’s biggest summer festival, the organisers had to get in extra chefs to satisfy the hungry queues.

Beef + Lamb New Zealand and Deer Industry New Zealand were invited to take part in this year’s Kieler Woche celebrations – the first time in the festival’s 130-year history New Zealand has been represented at the international market.

Cristian Hossack, seen here plating up for Kiel Woche, is the former head chef at Peter Gordon’s Providores restaurant in London. He is returning to New Zealand.

The market in Kiel’s picturesque main square is at the hub of more than 2,000 sports and cultural events which attract around three million visitors annually to a city with a population not much bigger than Hamilton’s.

Working 16 hours a day for 10 days, the Kiwi culinary team led by Marton-born chef Cristian Hossack (pictured right) served 7,000 lamb burgers, venison wraps and lamb salads, complemented by wines from Hawke’s Bay vineyard Coopers Creek.

Nick Beeby, B+LNZ Ltd manager for emerging markets and strategic projects, says it was great to be working alongside a chef of Cristian’s stature. A food critic who ‘mystery dined’ the festival rated the New Zealand offering top for food, service and value for money, stating “it was like eating at a restaurant.”

“It’s hardly surprising the food was so popular or received the plaudits it did,” Beeby says. “With a top chef and top produce, you can’t go wrong. But it’s even more impressive when you realise the chefs were juggling questions as well as pans.

“There was a constant queue of festival-goers lined up not only to taste our lamb and venison, but to find out more about its production, how to cook it and where to buy it; asking questions about everything from knife sharpening to sustainable farming practices. People loved it and we’ll definitely be going back again.”

The joint venture aimed to raise awareness of New Zealand lamb and venison in Germany, where consumers do not traditionally eat much of either.

Innes Moffat, venison marketing services manager at DINZ says the novelty was a bonus. B+LNZ and DINZ both run comprehensive marketing programmes in Germany. However the Kiwi presence at the festival for the first time generated lots of media interest and free publicity on television and radio, and in the press.

B+LNZ and DINZ attended in conjunction with a major Northern European retailer which sells New Zealand lamb and venison 12 months of the year – so festival-goers knew where to go to get it.

The two organisations will come together again in August for a three-day festival in Frankfurt, where around 40,000 visitors are expected through the New Zealand pavilion.

Photos below are courtesy of B+LNZ Ltd.

Hickson Fed Farmers Agribusiness Person of the Year

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Congratulations to Craig Hickson, managing director of Progressive Meats who last week was named the 2012 Allflex/Federated Farmers Agribusiness Person of the Year.

Five “exceptional nominations” were received by Federated Farmers, according to president Bruce Willis. Hickson was picked out from the five by judges Andrew Newman, Cr Hon Christine Fletcher and Waikato University’s Professor Jacqueline Rowarth.

“Craig is a hands-on farmer but the name of his company pretty much sums up his philosophy,” said Willis at the Auckland gala event where the award was presented to Mike Petersen, chairman of Beef + Lamb NZ Ltd in Hickson’s stead. Hickson himself was away in Australia representing the industry at LambEx 2012 and talking about questions Australian lamb producers should be asking their processors.

“[Hickson] runs a mixed 1,200 hectare sheep,deer and beef farm in Hawke’s Bay and in addition to Progressive Meats, is a member of the Meat Board. Craig is also a director of Ovation New Zealand and a number of other meat companies.”

Hickson has been an Meat Industry Association council member since 2003 and is also a Board director for Beef + Lamb NZ Ltd, Ovita Ltd, Lean Meats Ltd, Te Kuiti Meats Ltd, Progressive Leathers and Venison Packers.

An associated award, the Ravensdown/Federated Farmers Agribusiness Personality for 2012 went to agricultural scientist Dr Doug Edmeades, who was also a finalist for Agribusiness Person of the Year.

 

Congratulations to the Smiths

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Congratulations go to Otago sheep and beef farmers Blair and Jane Smith for winning the national title in the 2012 Ballance Farm Environmental Awards earlier this week.

The Smiths were awarded the Gordon Stephenson Trophy, having been chosen from nine regional supreme winners.

The award is sponsored by Beef and Lamb NZ Ltd (B+LNZ) because of its focus on showcasing farmers working sustainably and caring for the environment, says B+LNZ chief executive Scott Champion.

“This is the second year in a row that sheep and beef farmers have won the national trophy – Grant and Bernie Weller of Southland won it last year and undertook a B+LNZ-supported visit to Europe where they met industry representatives in key markets and had the opportunity to share their farming practices.

“We will be working with Blair and Jane Smith in the months ahead to ensure their great story of farming in an environmentally, economically and socially sustainable way is heard both within and beyond the sector,” says Champion.

Read more about the Smiths and their award here.

Lining up for grass-fed beef in Japan and Korea

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Chefs in Japan and Korea have been learning more about New Zealand grass-fed beef from award-winning Christchurch chef Darren Wright.

Beef + Lamb New Zealand (B+LNZ)’s market manager for Japan/Korea, John Hundleby says Wright, who has been in the two countries promoting New Zealand beef to a lineup of influential chefs and media, cooked a range of beef dishes at a number of events. His offerings included beef ravioli made from short-ribs, beef tortellini and tenderloin steaks.

“Since Korean and Japanese people are far more familiar with the cooking qualities of grain-fed beef which is more common in the two markets, a highlight at these events is always the demonstration of how to cook a good grass-fed beef steak.”

Japan and Korea are important markets for New Zealand beef farmers. Japan is New Zealand’s number two beef export market by value, worth NZ$230.7million (season ending 30 September 2011) and Korea is New Zealand’s number three export beef market by value, worth $203.1 million (season ending 30 September 2011).

“Beef + Lamb New Zealand works on behalf of farmers in these markets to introduce consumers to New Zealand grass-fed beef and then to develop a preference for it,” Hundleby says.

“Working with chefs and encouraging them to use our product is an important part of getting more Japanese and Korean people to eat New Zealand beef. Influential media also have a valuable role to play in highlighting the health benefits of grass-fed beef that make it lower in fat and higher in Omega-3s than grain-fed beef.”