Field Notes - issue 580

This week in New Zealand, food prices rise for a sixth consecutive month but some industries are set to fare better than others.

While dairy farmers are now forecast to reach a near-record milk price after another raise in the Global Dairy Trade auction, Turners and Growers warn of a profit fall and both avocado and asparagus producers see prices slide due to supply and demand imbalances.

We also see several stories of value-add opportunities, including the release of a RubyRed brand by Zespri, the accelerating opportunity for elderly dairy nutrition in China, and a limited release Zealandia honey marketed at $8,888 each. 

This week Head of Propagate Andrew Watene share's his insights and foresight on the potential consequences of irrational behaviour on our exports and our economy in New Zealand. His article includes the potential direct and indirect costs of poor Covid-19 management and vaccination, as evidenced by international examples. 

You can access the article here.

To read previous editions of Field Notes please click here.

NZ primary sector No 1 in KPMG's Net Zero Readiness Index [19 October, NZ Herald]

New Zealand's agriculture, land use and forestry sector has been ranked number one for tackling climate change issues in KPMG’s recently released Net Zero Readiness Index. In contrast, NZ’s overall national performance was ranked 9th, with Norway, the UK and Sweden taking out the top three places. KPMG examined 103 indicators of commitment and performance on decarbonising in 32 countries, which together are responsible for around three-quarters of global emissions. New Zealand ranked 6th for electricity and heat; 30th for transport, 19th for buildings and 15th for industry.

Tag: International, Environment & Emissions, Farming Systems

Making protein isolates from seaweed, not soy: ‘There is no reason to grow industrial ingredients on land’ [19 October, Food Navigator]

Israeli-based Genesea co-founder Alexander Golberg says his company is looking offshore to marine macroalgae in an effort to reduce reliance on terrestrial crops for ingredients manufacture. Conventional soy production uses “a lot” of fertiliser and equipment, which emits carbon, but seaweed “as far we know,” does the opposite: “it sequestrates carbon.”  Seaweed cultivation is reportedly considered more environmentally sustainable as production of one kilogram of soy requires 25-square-metres of land and 4,000 litres of water and “for our case you need none of this.”

Tag: International, Alternative Proteins, Research & Development, Food Innovation

McDonald’s partners with AgResearch in regenerative trial [19 October, Food Ticker]

Fast food chain McDonald’s and science provider AgResearch have joined forces on a regenerative farming trial which aims to increase plant growth, potentially leading to a better soil structure and higher water retention capacity. The two-year pilot study, soon to be underway in Hawkes Bay, will focus on alternative stock grazing management for cattle to boost the cycling of nutrients through the soil. McDonald’s said New Zealand is one of its top 10 beef producing markets.

Tag: Research & Development, Environment & Emissions  

Marks & Spencer to sell NZ beef and lamb in Singapore [18 October, Stuff]

A partnership between Alliance Group and British global retailer Marks & Spencer (M&S) will see a range of New Zealand beef and lamb products available to consumers in 11 M&S Singaporean stores. Alliance Group general manager Shane Kingston said M&S had been looking for a supplier to meet growing demand for protein in the region. The two parties had been in discussion for nearly two years. “This partnership fits with our strategy to capture more market value and builds on our existing long-term relationship with M&S,” Kingston said.

Tag: Red Meat, Trade & Exports, Food Marketing

Rapid grocery delivery start-up Gorillas secures nearly $1bn in funding [19 October, FoodBev Media]

Instant on-demand grocery delivery company, Gorillas Technologies, has raised nearly US$1 billion in a Series C funding round, claiming it marks the largest amount raised by a non-listed business in the European grocery delivery sector to date. Niklas Östberg, CEO and co-founder of Delivery Hero says, “Gorillas has been setting new standards for the delivery industry by offering an efficient and sustainable alternative to traditional grocers”. The new funds will allow Gorillas to strengthen its footprint in its existing markets and further invest in its operations, people, technology, marketing and finance infrastructures.

Tag: International, Food Marketing    

Kellogg’s $48m innovation investment in numbers [14 October, Food Ticker]

Kellogg’s NZ$47.7 million investment into innovation over the past 15 years in Australasia has seen the cereal and snack company’s New Zealand business remove more than 700 tonnes of sugar and 300 tonnes of salt from its foods. The company said more than half of its 55 cereals now contained two or fewer teaspoons of sugar per bowl. It has also created more than 100 new cereals including Sultana Bran Gluten Free, Coco Pops Gluten Free, and Sultana Bran with Cholesterol Lowering Plant Sterols.

Tag: Agribusiness, Food Marketing   

Chicken and egg: FPI increases for sixth consecutive month [14 October, Food Ticker]

According to Stats NZ, food prices rose for the sixth consecutive month in September 2021, up 0.5% on the month prior as the price of chicken and fresh eggs increased by 15%, followed by chocolate biscuits up 6.1%, and sweets up 3.2%. “The weighted average price of cage or barn-raised eggs rose sharply to NZ$5.22 a dozen, up from NZ$4.65 in August,” Stats NZ consumer prices manager Katrina Dewbery said. The overall food price increase was marginally offset by a drop in prices of cucumbers, capsicums and lettuce by 33%, 28% and 21%, respectively.

Tag: Agribusiness, Trade & Exports  

New technology will change the way farming is managed in the future [15 October, Stuff]

Rising technology in New Zealand is expected to affect the way farming is managed in the future. NZ’s new technology includes Halter’s virtual fencing, a virtual reality (VR) training simulator to train staff online to prune grapevines, and a seaweed feed additive that can reduce methane production. Halter’s smart collar automates cow movement and saves time on farm. The VR training simulator runs tutorials that allow for minimal supervision. The seaweed additive can inhibit methane production when given to cattle as feed.

Tag: Agritech, Food Innovation          

Farmers urged to be proactive about GHG numbers [14 October, Farmers Weekly]

Central Hawke’s Bay farmer Daniel Dooney says if sheep and beef farmers want to influence how future regulations around greenhouse gases impact them, they need to get on board with initiatives aimed at limiting that. A workshop run by Beef + Lamb New Zealand and Silver Fern Farms has reportedly helped farmers like him know the emissions profile of their farm. “If we’re not proactive and start to work things out for ourselves, the Government is going to come in and take over and probably just put a tax on per kilo of meat produced,” Donney adds.

Tag: Farmers & Producers, Environment & Emissions, Farming Systems

Avocado prices tumble: 'Everyone's going to run at a loss this year' [16 October, NZ Herald]

According to the industry group New Zealand Avocado, large volumes of fruit paired with weaker than usual demand have been pushing down avocados' returns. The group says less product is being exported to Australia due to an oversupply of locally grown avocados, while Covid-19 lockdown restrictions in New Zealand dented sales to restaurants and cafes. Bay of Plenty grower Hugh Moore says that another challenge for exporters is Covid-19 related freight delays and higher shipping costs, making reaching markets in Asia harder than usual.

Tag: Horticulture, Farmers & Producers, Trade & Exports

T&G Global warns profit will fall this year due to Covid-19 disruptions [18 October, Stuff]

T&G Global warned its profit this year may fall by as much as 76% as the Covid-19 pandemic disrupts its operations. It expects a profit of between NZ$4 million and NZ$10m this year, down from NZ$16.6m last year. “T&G continues to adapt to the challenges of the current operating environment, and the board is confident that the resulting operational efficiencies will, along with the growing revenue streams from its genetics business, result in significant improvements in performance over the next year,” chief executive Gareth Edgecombe said.

Tag: Horticulture, Trade & Exports, Agribusiness

Bumper South Island asparagus crop but lower demand as lockdown continues [18 October, Stuff]

A vegetable wholesaler claims there is an oversupply of asparagus in the South Island due to mild spring weather, but Auckland’s closed cafes, restaurants and hotels are affecting demand. A Countdown spokeswoman said that stores in the South Island were selling bunches for NZ$3, while asparagus in the North Island was selling it for NZ$3.50. Asparagus exporters were also facing supply chain difficulties but had more visibility than domestic suppliers, who were at the mercy of Government decisions, wholesaler Ajay Jina said.

Tag: Horticulture, Trade & Exports    

Fonterra issues personalised farmer reports [18 October, Farmers Weekly]

For the first time, Fonterra Co-operative Group has issued its suppliers with an individual yearly insights report, giving them a comprehensive picture of their farm from an environmental performance and animal health perspective. “We are trying to move to a position where we support farmers and tell farmers as early as we can about issues that are coming their way and help them prepare for things before they become regulations,” Fonterra acting director of on-farm excellence Michael Hide said.

Tag: Dairy, Farming Systems, Farmers & Producers

Changes to dairy product names likely needed for EU trade deal - Damien O'Connor [19 October, NZ Herald]

Trade Minister Damien O'Connor says good progress has been made on trade talks, but a sensitive issue in discussions has been the EU's desire to protect over 2000 food and beverage "Geographical Indications". The dairy industry said it's open to changing the labelling on some products to make the country of origin clear - but it's unwilling to stop using cheese names like feta and Gruyère. O'Connor says “the transition period and how much they have to change ultimately will be part of the final agreement and, I guess the ability for the exporters to accommodate that.”

Tag: Trade & Exports, Policy and Regulation

Building the 'Tesla of milk' [18 Rural News Group]

According to China market expert Jane Li, China’s infant formula market is declining, but a new market for a growing aging population in China means demand for nutritional milk products is increasing, emerging hundreds of millions of more potential customers. Li says Chinese, aged over 50, are seeking better milk nutritional products to stay healthy and live longer, so New Zealand dairy farmers seeking better returns from the Chinese market must act now.

Tag: Trade & Export, Food Innovation, Food Marketing

B+LNZ partners with Growing Future Farmers programme [19 October, Farmers Weekly]

Beef + Lamb New Zealand has teamed up with the Growing Future Farmers (GFF) Essential Farm Skills Programme to attract and train more young people to the red meat sector. The GFF programme offers a range of specialised industry training and development opportunities across the country, including formal New Zealand Qualifications Authority qualifications. “Currently, we have 45 student trainees on farms throughout New Zealand and are expecting to start a further 70 first year students in February 2022” Chair John Jackson says.

Tag: Agribusiness, Education, Red Meat

Fonterra joins Medical Nutrition International Industry [19 October, Food Ticker]

Fonterra Co-operative Group has joined the Medical Nutrition International Industry (MNI), which is representative of companies offering specialised nutrition solutions and services designed to meet the needs of patients. The group said that its ingredients brand, NZMP, could provide extensive knowledge on dairy ingredients in medical nutrition formulations. NZMP ingredients are sold in over 130 countries and MNI supported its mission to improve access to nutritional care through a range of healthcare settings.

Tag: Dairy, International         

Zealandia Honey’s $8,888 limited release [19 October, Food Ticker]

Taupō-based Zealandia Honey has released a space-inspired premium grade mānuka honey with a NZ$8,888 price tag. There are just 50 jars each containing 275 grams of honey. It was harvested in 2019 from a secret Northland location and contains a high concentration of the methylglyoxal antibacterial component. Zealandia co-owner Sri Govindaraju said the product, named Mars ZH21, had an MGO rating of at least 1717mg/kg “making it one of the highest grade mānuka honeys in the world”.

Tag: Food Marketing, Apiculture        

Foodstuffs hits back at category review criticism [20 October, Food Ticker]

Supermarket group Foodstuffs North Island (FSNI) has responded to recent criticism of its category review programme which will see a range of frozen goods cut from 1600 to about 1000 at New World, and down to 600-700 at Pak’nSave. New Zealand Food & Grocery Council chief executive Katherine Rich said “our category review programme is about making sure all of our customers get what they want, when they want and at the price, they think is fair value. FSNI did not respond to criticism about the deletion of individual products/suppliers but said that as a 100% Kiwi-owned business, it “proudly supports local suppliers.”

Tag: Policy and Regulation

Scientists link highly processed foods to memory loss [19 October, Food Navigator]

A new animal study from Ohio State University has found that four weeks on a diet of “highly processed food” resulted in a “strong inflammatory response” in the brains of aging rats and was accompanied by behavioural signs of memory loss. Senior study author Ruth Barrientos sad if the responses were triggered in humans, the consequences for individuals could be significant. Barrientos suggested older consumers to “scale back on convenience foods and add foods rich in DHA such as salmon and oily fish to their diets to fend off an inflammatory response.

Tag: International, Research & Development, Food Safety