Week in Review

In Aotearoa cheese exports hit a new high, with a 35% increase in value ($763 million) over the past 12 months. China was the leading destination for cheese exports, followed by Japan and Australia, Cheddar cheese made up 43% of total cheese exports. Speaking at the SIDE South Island Dairy Event, Vangelis Vitalis, deputy secretary of Trade and Economic at the Ministry of Foreign Affairs & Trade stated New Zealand's primary industry, especially dairy, is facing trade challenges not seen since 1995. These challenges are driven by increasing protectionism, regulations, a loss of social licence, and increased farm subsidies overseas. In a breakdown of costs from Cyclone Gabrielle in their Regional Water Assessment, the Hawkes Bay Regional Council has estimated the cost to the primary sector is over $1.7 billion. Rural Support Trusts have welcomed the announcement of $2.4 million of funding from the government. Of this funding, $1.9 million will be going to trusts in the North Island to help cope with the series of adverse weather events that began in October 2022 with late frosts affecting Bay of Plenty kiwifruit growers and continued with a succession of severe weather events throughout 2023. Aotearoa this week became the first country in the world, as of the start of July, to ban plastic bags for fresh produce in supermarkets in line with the government’s campaign to eliminate single-use plastics.

In international news Comvita signed a long-term partnership with premium supermarket chain, Olé, one of China’s largest retail chains with over 100 stores across mainland China. Chief executive of Comvita, David Banfield stated this will benefit consumers in China, Comvita shareholders, the planet, and the bees. Brazil has confirmed its first case of avian influenza (bird flu) in a non-commercial farm. The case was detected in a flock containing chickens, ducks, and geese in Serra, in the state of Espírito Santo. Sanitary measures are being used to contain and eradicate the outbreak, with increased surveillance in the region where the outbreak was detected. In California a new animal welfare requirement for breeding pigs, banning gestation crates, came into effect on 1 July 2023. It will be another six months before shoppers can be sure the pork in store will not be from pigs who have been confined in gestation crates. CEO of the Californian Grocers Association, Ronald Fong, said fresh pork products may be in short supply with the new regulations, however frozen is likely to remain well stocked. 

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Spotlight Stories

Environment & Emissions Spotlight

beach scene

UN agencies head up new $115 million push for cleaner, healthier oceans [29 June, United Nations]

The Food and Agriculture Organisation of the United Nations (FAO) will co-lead the USD$115 million Clean and Healthy Oceans initiative with three other partner agencies. The initiative will use policy and regulatory innovation, infrastructure investments, and nature-based solutions. Grants will be directed to clean up coastal areas to help countries curb land-based pollution of coastal environments and marine ecosystems. Since the 1950s nearly two per cent of oxygen has been lost from oceans resulting in ‘dead zones’, causing hypoxia that may have the long-term effects on valuable coastal fish species. The programme will also work to map land-based pollution to better understand hypoxia effects.

Tags: Environment & Emissions, Oceans

Research & Development Spotlight

Ocean, beach and trees coming together

Climate change: Robots help seagrass restoration [1 July, BBC]

Wales has successfully trialled the use of robots in large-scale seagrass restoration science. Seagrass, known for its importance for both carbon storage ability and as a nursery for fish, has seen up to 92% loss in the UK. Seagrass Ocean Rescue Upscaling Project (SORUP) in Wales used a robot, called Shack, which injected seeds into the sediment in the seabed at restoration sites. This is the first project in the UK at a meaningful scale, and experts are now working on developing and testing technology to make restoration at scale easier and cost effective. First Minister of the Welsh government, Mark Drakeford, has included seagrass restoration in his government programme, as the Welsh government wants to work with nature to fight climate and nature emergencies.

Tags: Research & Development, Climate change, Oceans

Headline Stories

Bees

Bees helping remote Pacific communities in fight against climate change [3 July, Stuff]

To help fight climate change, honeybees are being transported from Honiara, capital of the Solomon Islands, 12 hours away to remote island communities in Malaita Province. The Solomon Islands has the world's second-highest risk of disasters such as floods, cyclones, and sea-level rise. The bee campaign is part of the Sustainable Community Climate Resilience programme, launched by Save the Children and Mai-Ma’asina Green Belt (a tribal-based group in the Solomons), with support from Australia's government and the World Wildlife Fund. Local people have been trained on how to care for bees, which have dual benefit of creating an additional income source and pollinating mangroves which store carbon, produce food, and offer natural protection from cyclones

Tags: Apiculture, Climate change

Cargo ship

Zespri signs China trade deal to grow fruit exports by 50% [30 June, Stuff]

Zespri International Limited has signed a strategic cooperation agreement in China with its two largest distributors, Joy Wing Mau and Goodfarmer, to increase fruit sales by 50% over the next three years. The agreement aims to expand sales to 90 cities in China by the end of 2026, up from the current 60 cities. Zespri also signed a sustainable packaging agreement with Joy Wing Mau, Goodfarmer and also Pagoda and Xianfeng, who are the largest fruit shop chains in China. Zespri’s target for 2023 was to transition a third of its consumer packaging to sustainable options, and by 2025/2026 intends to transition all their consumer packs to sustainable packaging.

Tags: Horticulture, Economics & Trade

Groceries

Tesco, Sainsbury's and rivals say they are not making too much money [29 June, BBC]

UK politicians on the Business and Trade Committee have questioned supermarket executives as to why food prices for consumers continue to rise, when some wholesale costs are decreasing. According to British Retail Consortium (BRC), food prices rose 14.6% in the year to June.  Supermarkets have denied the claims they are making excess profits, stating they are actually shielding customers from the full impact of rising costs. The head of BRC, Helen Dickinson, stated the trade body predicts food inflation to decrease to single digits later this year. Most supermarkets are also starting to make price cuts on staple foods, with Sainsbury’s announcing earlier in the week they will invest £15 million to reduce the cost of items such as rice, pasta and chicken.

Tags: Economics & Trade

Get in touch

 

Audit – Auckland
Ian Proudfoot
09 367 5882
iproudfoot@kpmg.co.nz
Agri-Food – Auckland
Andrew Watene

09 367 5969
awatene@kpmg.co.nz
Management Consulting – Wellington
Justine Fitzmaurice
04 816 4845
jfitzmaurice@kpmg.co.nz
Private Enterprise – Hamilton
Hamish McDonald 

07 858 6519
hamishmcdonald@kpmg.co.nz
Farm Enterprise – South Island
Brent Love

03 683 1871
blove@kpmg.co.nz
Agri-Food - South Island
Paulette Elliott
+64 2788 61744
pauletteelliott@kpmg.co.nz