More collaboration among New Zealand’s export sectors could be the key to unlocking opportunities amid mounting challenges. This sentiment formed a central theme at the E Tipu summit, part of the NZ Future Food and Fibre forum held in Palmerston North, where over 280 industry leaders gathered to discuss the pressing need for rapid innovation and collective action in response to increasingly complex market demands.
Nuffield scholar Lucie Douma highlighted a stark reality: New Zealand produces enough food to feed just 40 million people, a figure that calls into question the viability of its agricultural focus in a world increasingly indifferent to its output. As identified by Hamish Renton, CEO of HRA Global, many NZ exporters seem to be coasting on their established reputations for quality and sustainability while facing challenges in maintaining these clean and green claims. He noted that the fragmented strategies among businesses inhibit their ability to collectively tackle evolving market requirements.
There has been a noticeable shift in how various industries approach collaboration. Renton pointed to successful examples such as the cocoa industry, which has thrived by working together in a pre-competitive space. He emphasised that New Zealand’s red meat sector could greatly benefit from adopting a more brand-focused strategy rather than relying nearly solely on price competition. Currently, industries like dairy have adopted a “winning at scale” philosophy centred around bulk products, inadvertently stifling opportunities for innovation and differentiation.
Interestingly, sectors like the wine industry, overly reliant on Sauvignon Blanc, serve as another example of how a narrow focus could limit potential growth and innovation. Renton suggested that breaking down industry silos could enable players to leverage shared market insights, innovate collaboratively, and diversify their offers from basic commodities to premium, high-value consumer goods. He posed a provocative question on how willing industries are to collaborate effectively at early stages to create a unified approach.
The stakes are particularly high in the dairy sector. Fonterra’s Chief Innovation and Brand Manager, Komal Mistry-Mehta, indicated that the cooperative is prioritising strategic areas for innovation, focusing on future demands for nutritional solutions amid a rising global population. With projections that 25% of the world’s population will be aged over 60 by 2050, the need for tailored nutritional products is urgent. Mistry-Mehta outlined efforts to collaborate with international dairy companies and innovators, such as BioLumic, to enhance Fonterra’s product offerings.
However, the challenges extend beyond collaboration and innovation. New Zealand has recently escalated a trade dispute with Canada regarding dairy product access, initiated under the Comprehensive and Progressive Agreement for Trans-Pacific Partnership (CPTPP). Such disputes underscore the geopolitical intricacies facing New Zealand’s exporters, particularly in the context of dairy, where tensions in trade relationships could alter market dynamics significantly.
Shipping disruptions are further complicating these challenges, with New Zealand’s dairy exports facing delays of up to three weeks due to geopolitical tensions and capacity constraints, such as those witnessed in the Panama Canal. As Fonterra’s global supply chain director pointed out, the need to reroute shipments around the Cape of Good Hope adds significant time to delivery schedules. This exacerbates the urgency for NZ exporters to innovate and collaborate, facilitating not just survival but a competitive edge in an evolving international market.
Moreover, a recent report highlighted critical productivity challenges that New Zealand’s food and fibre sectors face. Issues such as developing a skilled workforce, enhancing consumer-driven marketing, and fostering strategic collaboration emerged as pivotal for long-term success. As the sector grapples with rising operational costs, leveraging New Zealand’s natural advantages could drive evolution and profitability in global markets.
In summary, the discussions at the E Tipu summit point to a transformative paradigm: New Zealand’s export sectors, particularly in agriculture, must embrace collaboration to overcome their challenges. Whether by sharing insights and resources or by innovating together, the path to flourishing in a complex global marketplace lies in unity rather than silos.
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Source: Noah Wire Services
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