New Zealand must pull ahead of the rest of the world in agri-food innovation in order to retain a competitive advantage, speakers told the Ministry for Primary Industry's food and fibre innovation conference on Thursday.

"We need to be in a better position to respond to challenges like increased competition, potentially disruptive technologies such as synthetic alternatives and environmental and climatic impacts," said Martyn Dunne, MPI's director general.

Agriculture Minister Damien O'Connor said the sector - which contributes more than $38 billion in annual exports - has to "compete with others who are catching up fast."

O'Connor said it is critical that research and development become "business as usual" or the sector risks being overtaken by the Irish, South Americans or Europeans.


Ian Proudfoot, KPMG New Zealand's global head of agribusiness, said New Zealand remains the only country in the developed world that relies on agricultural food and fibre products to pay for the bulk of its expenses and so "it's not just about keeping up for New Zealand, but we have to keep ahead of the rest of the world."

There is "a lot of talk about tourism now being our primary sector but the numbers I keep looking at say tourism is only a quarter of what agriculture – food, fibre, timber - bring into our economy. This is still the biggest game in town," Proudfoot said.

Against this backdrop, it is critical to tackle complacency, something he termed the "biggest threat" to the industry.

"Ten to 15 years ago we had a very successful industry and today we have a successful industry. I think the jury is definitely not clear on how the industry will look in five or 10 years time. The market we are playing in is changing faster than its ever done before," he said.

Proudfoot pointed to things like blockchain technology. "If you are not having the conversation about how you, how your producers, how your farmers will be part of blockchain and how you will integrate with your consumer on blockchain you are a long way behind where you need to be," he said.

It won't be a "nice to have" but will be a "basic ticket to play." He estimates that most farmers will be impacted by the need to provide information into a blockchain within two years.

Other key issues include proof of authenticity and continuing to tap into the New Zealand's international reputation for higher quality products.

Sanford chief executive Volker Kuntzsch said his ambition is for Sanford to be the best seafood company in the world despite contributing less than 0.4 per cent to worldwide.


According to Kuntzsch, the competitive advantage of being a New Zealand company - given its international reputation - means half the battle is won.

Regarding the advent of synthetic protein, Proudfoot said the sector needs to realise it is happening but - similar to all areas of agri-food innovation - must focus on where "it needs to play" in order to remain competitive.

Above all, the sector must "understand this protein change and understand how we position our product into this new world," he said.