Week in Review

[15 July 2021]

This week trade and export stories dominate New Zealand, as we hear the rise of export prices for deer pizzles and environmentally certified meat, but further easing of commodity dairy and non-manuka honey prices.

Internationally, world hunger is the topic of the week with the release of reports by both the United Nations and Oxfam highlighting our growing rate of global undernourishment, which has reached its highest rate in over 15 years.

Article of the Week

This week Jack Keeys co-author of the Agribusiness Agenda 2021 shares his reflections of the past month since the Agenda’s launch, and why he believes it’s time for New Zealand to turbocharge our action in the development of next generation nutrition. 

You can access the article here.

Spotlight Stories

Innovation Spotlight

Mead, maps and meat – Sprout selects accelerator Cohort B [12 July, Food Ticker]

Three of the 12 food and agritech start-ups that have been selected to participate in Sprout Agritech’s second business accelerator of the year are a sparkling mead maker, a plant-based food manufacturer, and a probiotic kefir company. The programme starts on 14 July, and will give 12 teams access to advice from a global network of specialists as well as support on how to scale products for global markets. It also includes the chance to pitch for NZ$1 million of Sprout investment.

Tag: Agritech, Food Innovation

Food Security Spotlight

World Hunger Hit 15-Year High as Virus Stifled Food Access [13 July, Bloomberg]

According to the United Nations, world hunger spiked last year, outpacing population growth and probably reaching a record high since 2005, as the Covid-19 pandemic restrained incomes and access to food. The agency said it’ll now take a “tremendous” effort for the world to fulfil a pledge to end hunger by 2030 and reiterated a call to transform food systems. It is reported that the fallout from the pandemic put healthy food further out of reach for many people, and this year’s surge in food prices is particularly bad news for poorer countries who are dependent on imports.

Tag: International, Food Security

This Week's Headlines

headline 1

US buying up our primary industries [12 July, RNZ]

According to RNZ analysis, United States citizens and companies purchased the largest amount of New Zealand land for farming, forestry and winemaking over past 10 years, totalling 100,037 hectares. Most of the land sold in Canterbury went to US purchasers, while Southland land went to German buyers. United States purchasers bought several beef, sheep or deer farms, with the UK and the Netherlands ranking second and third as the biggest buyers of this type of land – most of which were in Otago.

Tag: Agribusiness, Trade & Exports, Policy and regulation

headline 2

Spring Sheep wins at dairy innovation award [12 July, Farmers Weekly]

Spring Sheep Milk has beaten global giants Nestle and China Feihe at winning the best infant nutrition category product at the World Dairy Innovation Awards. Spring Sheep’s general manager of milk supply Thomas Macdonald says its Gentle Sheep range had been selling well since its 2019 launch in Malaysia and has been seeing a growing demand. He adds, “we’re now having to backfill that with bringing new farms onboard and we have five new farms starting in the next few weeks. They’ll start lambing and supplying milk”.

Tag: Dairy, Food Innovation

headline3

The surprising rise of New Zealand's pizzle exports [09 July, RNZ]

Since 1994, more than 1700 tonnes of deer pizzles (male deer penis) have been exported from New Zealand, earning NZ$68 million. The pizzles are used in traditional Chinese medicine as a sexual vigour enhancer. In New Zealand, Cervidor offers dried pizzles, with testicles attached ranging in size from 80 to 100gm for NZ$299 each. They are also offered in capsule form costing NZ$44.95 for 120 pills. Three quarters of New Zealand's deer pizzles are sold to Hong Kong, with China as the second largest buyer, followed by Taiwan.

Tag: Red Meat, Trade & Exports, Food Marketing

Top stories

The 'cut-throat' industry of New Zealand beekeeping [11 July, Stuff]

It has been reported that many beekeepers are struggling to make a profit as prices of New Zealand honey continue to drop due to fierce competition as well as varroa and wasp invasions. Beekeeper Jane Lormier states she has seen a drop in Clover honey from NZ$15 to NZ$4. Additionally, third generation Hawke’s Bays apiarist John Berry says, there are no rules or regulations in relation to beehive location and people in urban areas are buying hives in hopes of sustaining the bee population, however the urban locations can cause struggle for the bees to find food.

Tag: Apiculture, Rural Communities

Kiwifruit grower Seeka invests in agritech business Fruitometry [09 July, Stuff]

New Zealand’s largest kiwifruit grower Seeka has announced a NZ$2.6 million investment in agritech business Fruitometry. Seeka chief executive Michael Franks said the start-up would enable them to better manage their orchards by provimding accurate pre-harvest fruit volume estimations as Fruitometry utilises advances in telemetry, imaging, and artificial intelligence. Fruitometry chief technology officer Christopher Miller said the investment would be used to rapidly scale the Katikati-based business, broaden its product line and expand internationally.

Tag: Horticulture, Agritech

GDT prices ease across the board [09 July, 2021]

Global Dairy Trade (GDT) prices dropped 3.6% in aggregate in the latest auction, making this the biggest fall since mid-March 2021. Analysts say the market reacted to news of New Zealand’s strong end to the milk production season and hesitancy from buyers to pay the recent premium commodity prices. Whole milk powder prices, skim milk powder, cheddar, butter and anhydrous all dropped by 3%, 7%, 9%, 3.2% and 0.9% respectively.

Tag: Dairy, Trade & Exports

SFF launches zero carbon Angus beef [08 July, Farmers Weekly]

Silver Fern Farms (SFF) will launch Toitū Net Carbon Zero Certified Beef into the US market this year. According to chief executive Simon Limmer, this follows the company’s work with AgResearch and Toitū Envirocare to complete a lifecycle assessment of its 100% Angus beef. Limmer says emissions from the beef will be accounted for by carbon removals by vegetation on the supplier farms. Co-chair Rob Hewett says the initiatives will stretch the company but are part of its vision to be “the world’s most successful and sustainable grass-fed red meat company”.

Tag: Red meat, Environment & Emissions, Food Marketing

Zespri mulls post-China vote options [07 July, Farmers Weekly]

Zespri intends to scale back its ambitions to run commercial trials with Chinese growers after reaching a 70.5% vote, failing to gain the 75% New Zealand grower support needed to push ahead with the programme. The programme aimed at working with Chinese growers who have planted unauthorised SunGold kiwifruit, originally sourced illegally from plants supplied out of NZ. “The problem is not going away and is only likely to increase. We are concerned about the impact of the volume of this G3 fruit on our retail space,” chief grower, industry and sustainability officer Carol Ward said.

Tag: Horticulture, Farmers & Producers

Achievements recognised at 2021 Primary Industries New Zealand Awards [07 July, NZ Herald]

The 2021 Primary Industries New Zealand Awards dinner has recognised several initiatives including a collaboration to reduce emissions and accelerate green hydrogen infrastructure, a company taking Kiwi honey to the world, as well as an initiative to boost farmer mental wellbeing through surfing. Stephen Thompson from Bayley's Rural Real Estate took out the Team Award for Surfing for Farmers. The Innovation and Collaboration award went to Ballance Agri Nutrients and Hiringa Energy, and the Primary Industries Producer Award went to the True Honey Company. Additionally, many individuals were recognised for their leadership in the primary industry.

Tag: Honours & Awards

Hold the meat: Plant-based cookbooks from Chelsea Winter and Nadia Lim lead the pack [11 July, Stuff]

Across all book sales in all categories, ‘Chelsea Winter’s Supergood’ was the top-selling title in New Zealand in 2020. Over 30,400 copies of the vegan cookbook were sold in 2020, according Nielsen’s BookScan, which monitors sales of over 350 New Zealand retailers, for a total sales value of over NZ$1.2 million. Additionally, a second plant-based cookbook appeared on the top-selling list: Vegful, the vegetarian cookbook from another MasterChef NZ winner, Nadia Lim.

Tag: Food Marketing

Fonterra says global dairy prices are pushing up cost of cheese [04 July, TVNZ]

According to Fonterra Co-operative Group, continued increases in global dairy prices are behind the higher cost of cheese – an increase of 15% over the last year. Fonterra Co-operative Group said since the pandemic, there has been a significant increase in demand for cheese in New Zealand and globally. It is reported that the increase in price of dairy products means some foodbanks are no longer receiving regular donations of milk and cheese to give to those most in need.

Tag: Dairy, Trade & Exports

A2 in APAC restructure, reshuffle and recruitment [12 July, Food Ticker]

The A2 Milk Company is restructuring its APAC division in a move that sees it reshuffle and recruit senior executives after the resignation of its Asia Pacific chief executive Peter Nathan as well as its fourth profit downgrade in four months in May. A2 said that its Asia Pacific division will be reorganised into three business units to provide a “more dedicated focus on its key components”. The three units are: international export business, Australia and New Zealand domestic business and China domestic business.

Tag: Dairy, Agribusiness, Trade & Exports

Wild weather drives supermarket spend to biggest June riser [12 July, Food Ticker]

According to Stats NZ, supermarkets saw the biggest rise in Kiwi spending in June 2021 as wild weather drove people to stock up and stay indoors. Stats NZ said spending on groceries, liquor, and specialised food rose to NZ$41 million compared with May 2021. It was reportedly the largest growth of any of the core retail industries and pushed overall card spending for June up 0.9% on May.

Tag: Food Security, Food Marketing

Meat sector faces crisis [13 July, Rural News Group]

New Zealand's meat processing industry could come to a halt in the next six months unless the Government acts to allow Muslim slaughtermen to enter the country. Meat Industry Association chief executive Sirma Karapeeva explains, the halal cut is a critical part in the killing process as the animal  “can continue through the chain as a halal carcass and can be broken down into various bits and pieces for export.” She says she's talked to politicians who claim they understand the problems the meat industry is facing, but they don't seem to have a solution.

Tag: Red Meat, Covid-19

Honey in sticky spot [13 July, Rural News Group]

According to Apiculture NZ chair Bruce Willis, New Zealand earned NZ$505 million from honey exports in 2020 and this season’s forecast is not looking as good. In the Ministry for Primary Industries latest report, honey exports are predicted to drop by almost NZ$1 million by 2025 and an estimated 20,000 tonnes of unsold honey are being held in beekeepers' sheds around the country. Willis says "The price of the honey that didn't meet the mānuka criteria crashed and a bunch of beekeepers have said they will keep this in their shed because they are not prepared to sell at the low price."

Tag: Apiculture

Peak dairy processing? [13 July, Rural News Group]

Global food company Olam International is setting up a milk processing plant in South Waikato, however, there are some questioning whether New Zealand dairy needs more ‘stainless steel’. Former Fonterra Co-operative Council chairman Duncan Coull warns that overcapacity will lead to inefficiency at the processor level and ultimately affect farmers negatively as processors try and deal with a lower return on their own capital. He adds, "rationalisation will have to occur at some point to deal with this. The effect on rural communities at this point can be devastating."

Tag: Dairy, Rural Communities

Central Otago cherry orchard preparing for 'electric future' [13 July, NZ Herald]

A New Zealand couple based in Central Otago have bought an electric tractor for their cherry orchard and are ‘electrifying everything’. Owner Mike Casey said the ‘electric future’ was coming and business owners should be excited about the efficiencies and cost-effectiveness of that. He hopes consumers will be prepared to pay higher prices for food that did not use fossil fuels, as their long-term vision is to develop a renewable consumer brand that growers could use to gain a premium price on their products.

Tag: Horticulture, Environment & Emissions, Farmers & Producers

Farmers vote yes on sheepmeat and beef levies [13 July, Farmers Weekly]

Almost 90% of farmers voted in favour of the sheepmeat levy on a one farmer, one vote basis, with support of 92% on a weighted stock unit basis. Additionally, 88.1% of farmers voted in support of the beef levy with support of 89.4% on a weighted stock unit basis. Beef + Lamb New Zealand chairman Andrew Morrison said, “we’re very pleased with the result particularly given the amount of farmer concern out there about the wave of regulation coming at them.”

Tag: Red Meat, Farmers & Producers

Returns Gone Sour: The impact of carbon pricing on the dairy sector [8 July, Food Navigator]

In a recent report, the FAIRR initiative explores what a carbon tax could mean for the future of dairy and its stakeholders. It is reported that New Zealand’s income carbon price brings a number of challenges for dairy producers as analysis finds that by 2050, carbon costs for New Zealand’s dairy sector could be equivalent to 26% of the current average operating profit of owner-operator dairy farms and 74% for sharemilking farms. Additionally, the increase in demand for plant-based alternatives will compound the regulatory risk associated with the carbon price.

Tag: Dairy, International, Trade & Exports, Environment & Emissions

‘We are excited to understand its potential’: Nestlé confirms move to explore cultured meat sector [13 July, Food Navigator]

The world’s largest food company, Nestlé, has confirmed it is eyeing the cultured meat sector after a leaked report revealed a tie-up with Israeli cell-based start-up Future Meat Technologies. Nestlé said it is looking to “understand the potential of future meat alternatives” and is “closely monitoring scientific trends and exploring emerging technologies”. The company’s initial plan is to create a blend of cultured animal fat combined with plant-based protein to sell to food manufacturers globally. They will then sell the equipment, technology and ingredients to larger food companies and farmers.

Tag: International, Alternative Proteins

Every minute, 11 people die of hunger: Oxfam [09 July, Aljazeera]

According to a report by Oxfam, about 155 million people around the world live at crisis level of food security which is 20 million more than last year. They identified countries including Yemen, Afghanistan and Venezuela as places where existing food crises were worsened by the pandemic and its economic consequences. Additionally, Abby Maxman Oxfam America’s president and chief executive officer said, “instead of battling the pandemic, warring parties fought each other, too often landing the last blow to millions already battered by weather disasters and economic shocks.”

Tag: International, Food Security

Agritech industry grew over 2020, report shows [13 July, RNZ]

According to The Technology Investment Network (TIN) report for 2020, the agritech industry is steadily growing despite challenges posed by the pandemic. Venture capital investment rose 13% to NZ$127 million, while angel investment rose 48% to NZ$160m. Additionally, the total value of exports rose 7.5% to $790.4m. TIN managing director Greg Shanahan said the sector was attracting strong investment but still needed improved access to government supply contracts, as well as initiatives to develop homegrown talent.

Tag: Agritech

Happy Cow launches capital raise, Hunt and Gather secures funds [13 July, Food Ticker]

Happy Cow Milk Company has launched its second capital raise as it looks to scale up its prototype into paddocks and retailers around the country. Its Founder Glen Herud is looking for a minimum of NZ$500,000 with a maximum target set at NZ$2 million via PledgeMe. On the other hand, Hunt and Gather Bee Company has taken in £350,000 as it is reported to deepen its reach into the domestic market and prepare itself for a strategic launch into international markets.

Tag: Dairy, 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