Week in Review

[10th March 2022]

If you didn’t check out our first-ever monthly Field Notes Foresights piece last week, be sure to take a look. The topic covers Trade and Export amongst the current global disruptions.

KPMG’s thoughts are with our Ukrainian and Russian whānau at this time, our global leadership team are working towards the safety of our people in the region.

This week, international news headlines have been about concerns the conflict in Ukraine will have on supply chains and food security; New Zealand exported NZD$293m of food and drink product to Russia in the year ending June 2021 of which, NZD$168.9m was dairy. Fonterra Co-operative Group as of last week suspended its shipments to Russia.

In other international news, estimates show that 400 million tons of vegetable food generated globally is wasted each year; InProve aim to reduce this figure by converting vegetable by-products into a fibre-rich ingredient. A study has shown the effects shrimp has on the environment which can account for mangrove deforestation, calculations showing 1kg of farmed shrimp produced almost four times more CO2 than 1kg of beef.

In domestic stories, we are seeing the effects of the omicron outbreak in many businesses and facilities. The farm to Process Animal Welfare Forum has encouraged meat producers to book spaces at meat processors in advance and be equipped to hold stock for longer on farm. The government has announced 300 international dairy worker exemptions to enter the country; in an article on a feijoa orchard, Southern Belle Orchard in Matamata a spokesperson said “pre-covid about half of their fruit was exported to the likes of the US, but the last two years extremely high freight costs meant all of their produce had stayed in New Zealand”; there is strong demand for deer velvet from the Asian markets which has pushed returns up 20%, making deer velvet NZD$100m farmgate returns.  

Foresight Focus Series

As pandemic and conflict-disrupted trade flows continue to cause uncertainty, it is those peering beyond the horizon who will position themselves in the most advantageous way for operating in this ever-changing world.

Unintended consequences, top line or bottom line, and what is the new currency in exports? | LinkedIn

Spotlight Stories

International Spotlight:

Ukraine war 'catastrophic for global food' [7 March, BBC News]

Yara International, a fertiliser production company, is worried that the Russia and Ukraine conflict has exuberated an already difficult situation. Supply chains face issues due to Russia's role as a critical supplier of natural gas and essential nutrients needed for fertiliser production. Svein Tore Holsether, Yara International President, warns, "it's not whether we are moving into a global food crisis - it's how large the crisis will be".

Tags: International, Global Supply

Fisheries Spotlight

Is shrimp a sustainable catch? [8 March, Food Ticker]

With shrimp accounting for nearly 20% of the global fish trade’s value, some are concerned about the environmental impact of shrimp farms (which account for 55% of all shrimp production). Financial Times Food Revolution series pays large attention to mangrove forests, found in tidal areas, these areas are well suited for shrimp farms. One study sourced showed that accounting for mangrove deforestation, 1kg of farmed shrimp produced almost to four times more CO2 than 1kg of beef. 

Tags: Fisheries, Sustainability

Headline Stories

Growers wary of Russia-Ukraine conflict [4 March, Farmers Weekly]

Brian Leadley, United Wheatgrowers chair, cites that excluding Southland, grain and seed harvests this year have been poor. Leadley further stated that in addition to the Russia and Ukraine conflict “things can’t get much worse”. Though prices are currently holding steady, supply and demand issues are expected to have an impact.

Tags: International, Horticulture, Arable

Agribusiness giants tried to thwart EU deforestation plan after Cop26 pledge [4 March, The Guardian]

Documents unearthed by the Guardian reportedly show some of the world's largest agribusinesses corporations who had signed a pledge to act against deforestation at the 26th Climate Change Conference (COP26) seeking to weaken a draft EU law that would ban the importation of foods linked to deforestation. They assert that the EU's plan to prevent imports of commodities linked to deforestation, such as coffee and cocoa, would increase farmers' costs and cause more significant risks of supply shortages for high-protein material.

Tags: Environment, Deforestation

Upcycling vegetable by-products into fibre-rich ingredients for 'juicier' burgers: 'We can make processed food healthier and more sustainable' [3 March, Food Navigator]

Estimates show that 400 million tons of vegetable food are wasted each year globally. Researchers from InProve aim to reduce this figure by converting vegetable by-products into a fibre-rich ingredient. Tests utilising the ingredient in plant-based foods have shown promising results, said a member of the InProve Team.

Tags: Food Innovation, Plant-based

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