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Week in Review

[18 March 2021]

Tomatoes are the talk of the week in New Zealand after reaching prices as low as 8c/kg in some supermarkets due to ‘freight disruptions’, this follows a high of $13/kg just six months earlier.

Meat alternatives make further progress in international headlines, with experts suggesting price-parity between cell-cultured and traditional meat could be achieved within a decade, and a Slovenian start-up claims to have achieved marbling in a plant-based steak. 

Spotlight Stories

Alternative Proteins Spotlight
tech

Insect protein as animal feed creating global buzz – Rabobank [16 March, Voxy]

Insect protein in the animal feed and pet food sector is expected to reach half a million tonnes globally by 2030, according to agri banking specialist, Rabobank. It provides many nutritional, functional and environmental benefits as well as creates a local feed production system and shortens the feed supply chain. Despite the growing demand, the insect protein limitations include limited scale, high costs and prices, and legislative barriers.

Tag: International, Food Innovation

Research & Development Spotlight
spotlight 2

NSW to lift GM crop moratorium [9 March, Rural News]

The New South Wales Government has announced that a moratorium on genetically modified (GM) food crops will be lifted in the state from 1 July 2021. Director of the Sydney Institute of Agriculture, Professor Alex McBratney, said “if we use genetic technology to improve the nutritional profile of crops, such as vitamin levels in rice, or by making crops more water-efficient, that will be a definite positive.” On the other hand, McBratney adds, some markets don’t want GM crops therefore, GM products must be labelled appropriately.

Tag: Policy and Regulation, Research & Development

This Week's Headlines

headline 1

World’s first’ plant-based steak marbled with sunflower oil [15 March, Food Navigator]

Slovenian start-up, Juicy Marbles, launched its plant-based steak which has been marbled with its key ingredient, sunflower oil. The sunflower oil helps achieve the marbling texture backed with new technology to make up the $150 price. “We now have a machine that enables us full control over fibre alignment (texture), intramuscular fat structure (marbling), flavours, aromas, and other meat parameters” said Juicy Marbles’ microbiologist, Luka Sincek. The plant-based steak’s main ingredients are soy and wheat protein, unsaturated sunflower seed oil, beetroot colouring and natural flavours and aromas.

Tag: International, Red Meat, Alternative Proteins, Food Innovation

headline 2

Greenlea enter bone broth market [15 March, Farmers Weekly]

Greenlea constructed a broth extraction plant at its processing facility in Morrinsville in hopes of mimicking the success of the United States’ profitable bone broth market. In its first week of test trials of broth products, the company is ahead of its official launch on May 17, 2021. Greenlea business development manager, Julie McDade, says the potential for this market is huge – in the US, bone broth tonic is a $600 million industry.

Tag: Red Meat, Food Marketing

headline3

Tomatoes selling for 8 cents a kilo in Auckland as prices slump to 12-year low [11 March, One News]

Covid-19 has hindered the exportation of tomatoes, leading to an oversupply in the local market and record low prices. A Hastings supermarket was selling 4000 kilograms of tomatoes for nine cents a kilo and Royal Oak Pak ‘Save in Auckland was selling the fruit for eight cents a kilo.  According to Statistics NZ, tomato prices decreased by 14% last month to its cheapest level in 12 years – the tomatoes are said to be not profitable for producers at that price range.

Tag: Horticulture, Trade & Exports, Food Marketing

Top stories

Data key to benchmarking [11 March, Rural News]

The general manager for WelFarm Ltd, Samantha Tennent, announced its WelFarm programme. Data is used to benchmark farms and identify areas for improvement. “Without the data and benchmarking we don’t know what good actually looks like and whether our efforts to improve are having an effect” Tennent said. The programme helps to prove New Zealand farmers are operating sustainably, continues the access to export markets and has evidence that the animals are being treated ethically.

Tag: Farming Systems, Farmers & Producers, Agritech

Farrowing crate review underway [11 March, Farmers Weekly]

Pig farmers are facing uncertainty due to the lack of viable alternatives of mating stalls and farrowing crates which may be banned for New Zealand producers. Many parties are still reviewing and looking at new ways of pig farming that retain the current system’s benefits whilst meeting health and safety obligations. NZ Pork chair Eric Roy and chief executive David Baines says, NZ Pork will be asking for input from its farmers and supply chain participants to review the code over the coming weeks.

Tag: Animal Welfare, Port, Farming Systems, Policy and Regulation

Growing agritech [11 March, Farmers Weekly]

Modifications to a proposal under the Agritech Industry Transformation Plan (ITP) have been made to create a national centre of excellence for horticultural robotics. Concerns regarding duplication of existing facilities were raised in the modification, and it aims to help grow the agritech sector which already earns NZD$1.4 billion in exports annually. Agritech New Zealand chief executive, Brendan O’Connell, says it makes more sense to act as a catalyst and support existing research and engineering groups than set up a whole new national centre.

Tag: Agritech

Fonterra declares $391m half-year profit, 5c interim dividend [17 March, Rural News]

Fonterra Co-operative Group showed a net profit of NZD$391 million and normalised earnings before interest and taxes (EBIT) of NZD$688 million. Fonterra chief executive Miles Hurrell said, “Despite the major impact COVID-19 is having around the world, the co-op is staying focused on what it can control – looking after our people, making progress on our strategy to drive sustainable value for New Zealand milk and remaining committed to our 2021 priorities." Greater China contributed significantly to the group’s performance of NZD$339 in normalised EBIT. 

Tag: Dairy, Farmers & Producers

Automation a mixed blessing for fruit sector [9 March, Farmers Weekly]

The rising crop volumes in the horticultural sector is opening up opportunities in automation and robotics. This aims to offset the labour shortage and decrease the cost of labour. Packhouse operators said, the seasonal harvest will not provide a high return on hi-tech capital such as 3D camera imagery for fruit grading, automated high-speed packers and robotic pallet stackers. Thus, developers of technology are investigating more upfront capital to help the horticulture sector.

Tag: Agritech, Horticulture

How FoodStarter is changing the lives of foodie superstars [12 March, Stuff]

Two winners will be chosen for FoodStarter, a nationwide competition, where both winners will receive extensive support and guidance to help grow their product. The judges chose 10 finalists from 217 entries. Key themes amongst these finalists are plant-based products, innovative beverages and sustainable production. Marian Johnson, Chief Executive of Ministry of Awesome says, FoodStarter judges are looking for two winners with the ability to grow and scale their business, a strong point of difference and innovation in their product.

Tag: Food Innovation, Food Marketing

Shops return to rural Sweden but are now staff-free [10 March, BBC]

A Stockholm-based start-up, Lifvs, launched unstaffed convenience stores in 20 rural neighbourhoods in Sweden. Lifvs co-founder, Daniel Lundh, said, "There were food deserts where people had to travel to the next town or city to pick up their groceries and so we definitely saw that there was a need." Payment for the wide assortment of groceries can be completed in the company’s app which is connected to the purchaser’s BankID and the secure national identification app, operated by Sweden’s banks.

Tag: Rural Communities

 

Final sweep for M bovis infections [12 March, Farmers Weekly]

The Mycoplasma bovis eradication programme is launching a new project to ensure all risk of the infection is found. The project includes double-checking some formerly infected properties whilst applying new tracing tools and greater knowledge of the disease. M bovis programme director, Stuart Anderson, said, “it’s timely to do routine checks now to be sure no infection is around as we do the planning to move fully into long-term surveillance.”

Tag: Biosecurity, Farmers & Producers

Women grow as much as 80% of India’s food – but its new farm laws overlook their struggles [12 March, The Conversation]

The large portion of Indian women farmers in the primary workforce are vulnerable to three new laws that deregulate the agriculture market and weaken the government-established minimum sale price for crops. As more men in India seek higher incomes and better jobs, the women are left behind on farms and are affected by these laws. According to the international humanitarian group OXFAM, nearly 75% of the full-time workers on Indian farms are women, who produce 50% to 80% of the South Asian country’s food.

Tag: International, Food Security, Policy and Regulation

 

Bacon and ham slip through country of origin labelling loophole [16 March, Stuff]

Only fresh and cured pork must be labelled with its country of origin after a rule change to take effect in December 2021. NZ Pork chief executive, David Baines, said, “this labelling will mislead many into thinking they are purchasing New Zealand pork when they are purchasing imported pork that has simply been further processed by a New Zealand manufacturer.” 85% of New Zealanders agree that imported pork marinated in New Zealand should be labelled as imported pork yet the rule was still implemented.

Tag: Pork, Policy and Regulation, Trade & Exports, Food Marketing

Work to begin on $17m fish screen for Rangitata Diversion Race [13 March, Stuff]

Rangitata Diversion Race Management Ltd’s NZD$17 million irrigation scheme is underway in response to concerns from anglers and runanga. Sports fish are being caught in the 67-kilometre long irrigation race which extends from the Rangitata river to the Rakaia River. According to chief executive, Tony McCormick, the new system means water will pass through the slots and continue on down the race while the fish will be excluded and will return safely to the river through the fish bypass channel.

Tag: Rural Communities, Water

Time to revisit NZ’s science system [15 March, Farmers Weekly]

New Zealand’s top scientist, Sir Peter Gluckman, said a revision of the current environmental research funding model is needed to ensure the NZ dairy industry’s future success. Currently, the model is focused on relatively short-term excellent and high impact research, but high-quality, long-term research is key to support NZ’s future. “Long-term research will fill environmental data gaps in areas such as soil, biodiversity and water, so we are able to make future environmental decisions on a data-informed basis” Gluckman said.

Tag: Research & Development

Northland farmer project exceeds expectation [15 March, Farmers Weekly]

More than 400 livestock farmers took part in Northland’s NZD$4-5 million Extension 350 programme which was made to increase their overall success. These farmers participated in many activities, including a Mark and Measure course and mentorship to boost their financial performance. The project's overall objective was to encourage a New Zealand farming discussion group for experienced farmers to help other farmers, lift financial performance as well as farmer wellbeing and environmental sustainability.

Tag: Farmers & Producers, Farming Systems, Red Meat

New tax rules are ‘flawed’ [15 March, Farmers Weekly]

A new taxation rule coming into force on July 1 will have direct impact on farm sales but some faults have been detected. The association’s NZ tax leader, John Cuthbertson, said it will affect “relative negotiating positions of the parties and adding uncertainty and compliance costs.” The Finance and Expenditure Committee has acknowledged several shortcomings and recommended changes to improve the draft legislation.

Tag: Policy and Regulation, Farmers & Producers

Kill rate sparks breeding flock concern [15 March, Farmers Weekly]

High demand from China has resulted in a slaughter of the country’s core ewe breeding flock. AgriHQ senior analyst, Mel Croad, says 3.7 million ewes are forecast to be killed this year. Croad believes some farmers are looking at the capital tied up in breeding flocks and are seeking less financial risk. This is also leading to some land diversion to forestry, to be more profitable in the long-run.

Tag: Red Meat, Farming Systems, Farmers & Producers

Dairy prices weaken 3.8% at overnight global auction; remain elevated [17 March, Stuff]

After a surge in average dairy prices two weeks ago, dairy prices seem to have eased in the overnight global auction and remain elevated amid strong demand from North Asia. NZX senior analyst, Amy Castleton, said, “There is little doubt now that whole milk powder prices will remain elevated for the short term with this level of demand being shown.” The global dairy trade price index dropped by 3.8% and the whole milk powder dropped by 6.2% to an average of USD$4083 a tonne. 

Tag: Dairy, Trade & Exports

Hefty opening milk price forecast for new season [17 March, Rural News]

The opening forecast price for milk in the 2021-22 season starts strong, sitting between NZD$7.25/kgMS and $7.30kgMS. However, ANZ agriconomist, Susan Kilsby, states there is no guarantee that they will remain at this level due to the uncertainty of what is driving the prices up and how long it will be sustained. “We anticipate we will see some correction in pricing within the next 12 months, and when this occurs, it may do so at pace” Kilsby said.

Tag: Dairy, Farmers & Producers, Trade & Exports

NZ Rural Land buys its first dairy farm for $10.4m [16 March, NZ Herald]

New Zealand Rural Land Co (NZL) has bought its first dairy farm (456ha) in Mokoreta, Southland, for NZD$10.37 million. The company said, “NZL continues to work on several larger-scale acquisitions of dairy farms in the South Island and expects to complete those negotiations in the ensuing weeks with earlier settlement dates than traditional dairy farm settlements (June 1)." NZL’s shares last traded at $1.19, up from 5 cents on Monday.

Tag: Dairy, Agribusiness

When will cell-cultured meat reach price parity with conventional meat? [15 March, Food Navigator]

According to two new studies from Dutch consultancy CE Delft, cell-cultured meat has potential to be cost competitive with some forms of conventional meat within a decade. This will require higher-density cell cultures, more efficient use of food-grade media, food-grade equipment in facilities and growth factor production. Development of existing systems from expanding bioreactor systems to saving electricity will ensure cell-cultured meat are on the right track to price parity with conventional meat.

Tag: International, Red Meat, Alternative Proteins, Food Innovation

Organic food reforms: MPI seeks feedback on enforceable rules [16 March, RNZ]

The Ministry for Primary Industries (MPI) is seeking feedback on proposed reforms to the organic sector to ensure no extra costs are added to the already expensive process of selling organically. The new requirements involves growers having to have an organic management plan and have their operations verified by MPI before making organic claims about their products. MPI policy spokesperson Fiona Duncan said, the new requirements aim to balance between the certainty that businesses were meeting organic standards and ensuring reasonable business costs.

Tag: Policy and Regulation, Agribusiness

Get in touch

 
Audit – Auckland
Ian Proudfoot
09 367 5882
iproudfoot@kpmg.co.nz
Management Consulting – Wellington
Justine Fitzmaurice
04 816 4845
jfitzmaurice@kpmg.co.nz
Agri-Food – Auckland
Jack Keeys

09 363 3502
jkeeys@kpmg.co.nz
Private Enterprise – Hamilton
Hamish McDonald 

07 858 6519
hamishmcdonald@kpmg.co.nz
Agri-Food – Auckland
Andrew Watene

09 367 5969
awatene@kpmg.co.nz
Consultant – South Island
Genevieve Steven

03 307 0761
gsteven@kpmg.co.nz

Farm Enterprise – South Island
Brent Love

03 683 1871
blove@kpmg.co.nz

Field Notes Administrator
Angelo Marundan
+64 9363 3624
amarundan@kpmg.co.nz

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