Editorial: NZ's great China move
OPINION: The New Zealand red meat sector, with support from the Government, has upped the ante to retain and expand its niche in the valuable Chinese market - and the signs are looking positive.
His comments come at a time when the challenges facing the red meat sector are real. Boulton says they affect all parts of the supply chain from on-farm, through to processing and onto customers.
According to Boulton, one way to face the challenges is to spell out very clearly to buyers and customers that NZ is producing high quality sustainable products than our competitors simply can't match.
Boulton says there have been big shifts in the global supply chain with Australia's exports of sheepmeat putting pressure on NZ in key markets such as China.
"There is also increased production coming out of South America and because of the extra volumes of meat on the market, prices are dropping. The challenge is, how do we differentiate ourselves against South American and Australian production?" he says.
From a SFF perspective, Boulton says they have invested heavily in diverse channels such as retail, e-commerce, wholesale and food service markets. This he says has given them good diversification across out key markets. SFF is also identifying the customers who value NZ products and having the right distribution partners to get to them.
"We want to have a very special relationship with them, which is why we have to be so disciplined in our route to market," he says.
To that end, Boulton says SFF has invested strongly in brands and teams in key markets to deepen their connection with high value customers.
He says while the Chinese market is currently subdued, SFF still sees it as strategically important and is investing there so it will be well-positioned to take advantage of the Chinese recovery.
Selling Our Story
For decades there have been various iteratons of selling the 'NZ Story', but Dan Boulton believes that right now this is top of the list if we are to see off our competitors.
The new 'Origin of Country' campaign scheduled to kick off in China at the end of the year is one tool that's been embraced and run by the meat processing companies, with support from B+LNZ.
He says the sustainability practices of our farmers is something our competitors cannot match. And what we do is exactly what our high value consumers want. Boulton says one of the problems is that NZ is being tethered to the commodity cycle, but he notes NZ's so-called commodity product is of much higher quality than that of South America, for example.
"Our farmers have got the biodiversity and the sustainability practices, and we have got to package it up, take it to the customers and lift the whole commodity market to a new level," he says.
Boulton says by doing this - backed by hard data and good independent verification programmes, including the NZ farm assurance programme plus - NZ should be able to extract a premium for its commodity products over its competitors.
"We can't ignore we are in a real pain point at the moment, but I think the mid to long term outlook for producers is really promising," he says.
