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There鈥檚 no disputing that the past 18 months have been tough in the primary sector, but the tide has turned and it鈥檚 time to celebrate, industry leaders say.
In his address to the Primary Industries New Zealand Summit in Christchurch, Silver Fern Farms chief executive Dan Boulton said 鈥渋t鈥檚 been a challenging last period, but also there are opportunities out there for us to go after鈥.
He said profitability in the sector is all about what is happening at the farm gate, 鈥渟o celebrate the current pricing we are getting now鈥.
Removing costs of $80 million in a 鈥渞uthless prioritisation鈥 exercise has ensured strategy is delivering but there is still vulnerability both domestically and globally.
鈥淐ustomers are going really deep into our supply chain 鈥 human trafficking, deforestation, animal welfare; these are things we can win in and are getting now with high value customers. We are getting a good share of their wallet.
鈥淲e are having richer and deeper conversation with our customers and that delivers returns back to farmers.鈥
Boulton said there鈥檚 no substitute for getting boots on the ground in China and North America and despite global challenges, it鈥檚 expected pricing will remain firm for some time.
鈥淩ed meat consumption is increasing, but we are having to fight harder for the market in China. We need to get smarter with greater sophistication with digitalisation driving customers.
鈥淲e are now deeper into markets in the grass-fed regions, that鈥檚 where 80% of our product is going, not the big cities.
鈥淭he markets are so cluttered, we have got to do a good job selling our story.
鈥淐hina and America are very valuable to us; we have got to be agile and mindful of what is going on.鈥
Boulton said managing capacity imbalance is taking the biggest part of his time right now.
鈥淲e have got profitability in the industry but we have structural issues to solve. SFF is prepared for that.鈥
Fonterra president for global ingredients Richard Allen said the high regard NZ dairy enjoys right around the world favours its ability to meet new demand emerging on the global nutrition platform, including specialised medicinal and medical above the common dairy products.
鈥淐onsumer preferences have changed incredibly in the past 10 years away from drinking dairy to eating dairy.
鈥淥ur customers around the world are realising that by adding dairy fluid or whole milk state into solid products it entices consumers and creates new innovative ways of marketing.
鈥淚n a world where volatility is clearly here to stay, we have the unique advantage of how we farm but still, selling product going up or down 20-30% in a season, we want to be innovative but not too complicated in the balance.
鈥淥ur identity in the global market is critical. Our competitors are going hard at us.鈥
Zespri chief supply chain officer Tim Mackle said key to the 10-year strategy is brand-led demand.
鈥淲e have had our bumps and [we are] at a time now when we have to look at the supply chain as a competitive weapon going forward in how we grow innovation.
鈥淲e have been doing this for 20 years; it鈥檚 time to step up and deliver more value.
鈥淲e are in there and addressing competition. We know we can grow more kiwifruit in NZ and offshore so we can supply kiwifruit 365 days of the year.鈥
Future growth will be in health and wellbeing.
鈥淲ith growing competition the big challenge in front of us, we can鈥檛 rest on our laurels. We need to double down on health benefit potential and build from here.鈥