Growth in the Māori sector

Liz Te Amo.

Liz Te Amo is well placed to assess how Maori are leveraging their $50 billion plus in land and sea-based assets.

The Tauranga-based champion of Maori business growth draws on 30 years working in this arena when she gives her verdict on the degree to which her people are leveraging opportunities in extracting the greatest value from those assets.

"Even though we have a $50 billion asset base, we are very much an emerging economy."

Te Amo says that's because iwi have spent the past 10 to 20 years on the inter-generational buildup of their primary-based assets.

"You have to wait for those asset bases to build before you start talking about a thing called the Maori economy, which is made up of businesses and entities that are generating GDP and have labour pools servicing and contributing to that economic activity."

The complex science of measuring the pace of growth and development for Maori starts with the asset base, looking at the nature of the growth, identifying the businesses contributing to the growth and the individual iwi leading the way.

Te Amo says a distinction needs to be made - which many people don't appreciate -
"between money gleaned from Treaty of Waitangi settlement processes, and the intergenerational Māori landowner assets at the hapū and whānau level."

She says at this stage, Maori are still quite conservative investors, who are holding back on direct investment in the global agribusiness sector while they build a domestic base which is nevertheless focused on export.

"There are not a large number of Maori direct exporters per se but there are a lot of NZ reports being produced on Maori land and by Maori entities. That's why you have to think about the Maori economy, not just in direct export returns or how many exporters there are."

Te Amo says any investment strategy has to be market-led, which means identifying and developing an opportunity.

She cites Maori-owned dairy company Miraka as a standard-bearer for this concept.

Located in Mokai, 30km northwest of Taupo, Miraka uses sustainable and renewable geothermal energy, state-of-the-art manufacturing processes, and capacity to process more than 250 million litres of milk into powders and UHT products every year.

The Miraka milk supply comes from 100 local farms within an 85km radius of the factory, and its products reach more than 23 countries.

Miraka is owned by a group of Maori trusts and incorporations, including Wairarapa Moana Incorporation, Tuaropaki Trust, Waipapa 9 Trust, Hauhungaroa Partnership, Tauhara Moana Trust and Huiarau Farms.

Te Amo: "If I think about Miraka and their Vietnamese partner, you take a strategic investor and partner only for how it's going to deliver your outcomes in your business strategy. There's no point, for example, having a Russian partner if you don't have access for the product and Russia isn't your main market channel".

Te Amo is business development manager for another trailblazing Maori business, Miro LP (Limited Partnership), which she describes as the "Zespri of berries."

The company was formed after director Steve Saunders was challenged to say what would a high-value horticulture strategy look like for Maori.

"He said you would need to own the IP (genetics), as much of the value chain as you can, and operate on Maori land, employing Maori people, and giving Maori the opportunity to invest, because they don't often get the opportunity to invest in a high value horticultural chain - they are often growers at best."

What sets Miro apart is that under its joint venture agreement with Crown Research Institute Plant and Food, it owns the intellectual property for large-scale berry production - from genetics to growing, processing, packaging, exporting, and marketing - this is where the ongoing values lies.

In choosing an appropriate product category, blueberries stood out as a category which is in almost "insatiable" demand globally, and in which the breeding could be controlled through the Plant and Food partnership.

"When you have people (Maori) who have just leased the land to the neighbouring cow farmer for generations, it's a big educational capability climb up to then involve them in a high-value export horticultural chain."

"They love it - what they get and particularly kaumatua - is they can see straight away what it means to own the genetics, and what it means to get their people trained in the horticulture industry. They're so excited about the idea of bringing businesses onto their land, where they can employ their own people."

Te Amo says the Zespri comparison comes from them controlling their own genetics, research and development, packaging, exporting, and marketing. They would say they are a brand and marketing company - what they don't do is growing or post-harvesting, or high-value processing.

"Miro aims to be part of all that (the Zespri model) - we are thinking very carefully about what high-value processing might make sense for us."

Global consumers, Te Amo says are "really interested" in the importance within a brand of kaitiakitanga (guardianship and conservation) - much more so than in "massive models" of coprorate farming - and how Maori work with family on the land.

They want a personal connection with who is growing their food, how it's being nurtured and taken care of."

While Maori investors might be conservative on the whole, Te Amo says there is always room for more growth in the Maori agribusiness sector.

"Commentators would say the Maori economy represents some of the most exciting growth around. It's grown faster than the mainstream NZ economy, because it's coming off a lower base, but it's still growing quite rapidly.":

Asked what the key drivers are for this potential growth, Te Amo replies: "Things that help any business grow - you have to be market-led, and to be market-led you need to gain experience in those markets."

Many Maori have done that over the last 10 years in particular, by going on ministerial-led trade missions (in which Te Amo has also been a key participant).

A "new wave" of Maori business leaders are emerging, emboldened not only by their trade mission experiences, but by immersing themselves in key markets, building partnerships and developing sales and marketing channels.

The Te Hono primary sector leadership network, whose 'godfather' is John Brakenridge of NZ Merino Company fame, has contributed strongly to the education and emergence of this new wave of leader, including having sent 60 such leaders to 'boot camps' at Stanford University in the US, providing them with access to world-leading expert thinkers and binding together NZ's primary sector leadership, including a big tranche of Maori.

"There aren't many fora like this where these leaders can talk, but at Stanford they can talk about issues like consumer trust, the impact of technology, climate change, and the environment."

"Learning what it takes to export or internationalise a company is about understanding value chains really well, and you can't do that unless you follow them all the way through a market, understand who the players are, and then spend time in the market, and marry that experience with your consumer preferences."

"Do consumers want to buy online or from supermarkets, what do they care about?" .

"It's a hard thing to feel when you sit in NZ, but when you run trade missions globally the thing that absolutely intrigues and captures their (consumers) imagination is Maori culture- they want to know about our people, and our brand stories. That's where a really big opportunity exists for Maori and a unique one."