Silver Fern Farms CEO sees better days ahead
Despite Silver Fern Farms (SFF) posting a $21 million loss last season, chief executive Dan Boulton believes that better days are coming.
It's mainly currency driven, Deer Industry NZ (DINZ) chief executive Dan Coup told Rural News. But increased demand particularly in Europe is contributing.
At $8.63, the spring peak of the 2015 venison schedule was 11% higher than 2014 and the highest since 2011. The average stag venison schedule now stands at 728c/kg, compared with 630c/kg at the same time last year – an increase of 16%. This reflects an 11% currency gain and a 5% market gain.
"Venison prices peak each year in spring in response to demand from traditional game meat markets in Europe," says Coup.
"Demand for chilled venison during the 2015 season was solid, with air freight shipments continuing up to Christmas."
Coup says the New Zealand dollar has weakened significantly for a variety of reasons vs the euro, and the market has improved.
"Europe, where we sell most of our venison, has had serious austerity over the last eight or so years that has hurt us badly, but they are starting to get their heads above water in some places.
"I wouldn't say it is all honky dory but they are starting to recover which helps with demand. But the currency is the single largest factor."
The industry is also trying to create new demand in new places. "Part of that trajectory is demand that is a bit different from the traditional seasonal stuff out of Europe. That is all about timing."
A key objective is to build year-round demand for chilled venison at premium prices in new markets and new segments of existing markets. It is also the focus of the Passion2Profit strategy, a Primary Growth Partnership programme between DINZ and the Ministry for Primary Industries.
"At present, the largest year-round market for chilled NZ venison is North America, with 600 tonnes worth $NZ12 million sold there in 2015," he says.
"Sales there have been under the Cervena promotional banner since the appellation was launched in 1993. This year we will be [doing more] in new Cervena markets like the Netherlands which are part of P2P, as well as existing Cervena markets like North America which are not."
Digging a little deeper into the figures, Coup says the market price gains reflects a 12% increase in the per kilogram value of chilled venison exports.
"Chilled exports made up 17% by volume and 30% by value of total venison exports in 2015," he says. "The total value of chilled exports increased by 10% while the volume dropped by 1%. Overall venison exports dropped in volume by 5% to 15,035 tonnes."
