Pooling resources vital if NZ is to beat global meat giants

By JANET TYSON

Last year I was living in the past, immersed in the New Zealand meat industry from 1972 to 1997 co-writing the book Meat Acts. Hectic years like 1982, when the Meat Board took ownership of all sheepmeat, sometimes seemed more real than the daily news.

But the uncanny thing about working with the past is how many echoes there are in the present.

Stay wide awake and read the fine print, I wanted to shout to Richmond shareholders when I first read of PPCS's interest in their company.

Several times in the past the South Island company made huge strategic advances in ownership and profit, largely because of its skill in interpreting what was possible.

The battles for ownership are some of the most fascinating parts of recent meat industry history. It's a measure of the huge change over 25 years that Affco, Alliance, Richmond and PPCS, four relative minnows in 1970, now dominate processing and exporting.

Dramatic in a different way is the change in the cattle and sheep of New Zealand and how the increase in productivity has outweighed the loss of land to other uses.

The late '60s and early '70s marked the arrival of many new beef breeds. With Kiwi ingenuity, the exotics laid the foundation for our unique bull beef industry, hugely boosted by the Holstein-Friesians brought in to transform the dairy cow.

Hard to believe that serious investigations were being made into how Taranaki's dairy farms could be converted to beef, seen as the product of the future.

The dairy industry refused to die. It has flourished, often at the expense of sheep and beef, while developing an aura of success and invincibility.

The meat industry struggled with a brutal transition to market realities after SMPs (supplementary minimum prices) were dismantled, leaving a debt instigated by the Government but blamed on the Meat Board.

While the board fought a half-successful battle to hold on to the money earned through the bulk-purchase years of supplying Britain, the dairy industry managed to have even bigger debts forgiven and forgotten.

The public and the media watched critically as the meat industry stumbled about, seeking to set up effective free enterprise industry structures. Meanwhile the single-desk dairy industry forged ahead, its arguments behind closed doors, its image regularly repolished.

Much of dairying's success is deserved, but some will feel a tinge of glee that this golden industry has revealed feet of clay with the failure of its mega-merger.

What an incredible lack of business nous to go so far down the discussion track without independently assessed and verifiable figures. It smacks of one of the worst aspects of farmer behaviour - the compulsion to air views on a contentious issue, whatever the cost, yet be so selective with facts and careless of realistic possible outcomes that nothing results but sound and fury.

Are dairy farmers really living in the past, where there was one set of rules for farmers and another for everyone else? How else do you interpret a mega-merger whose priority was to increase farmer returns by 12 per cent? Battle-hardened sheep and beef farmers would point out that any change in an export business should be driven by what the market and customers want.

It's a worry for our agriculture that the two dairy giants want to pull in different directions. There's now a hugely pressing reason to work and plan together.

It's called biotechnology. Only through pooling resources can New Zealand capitalise on the matchless intellectual property we have in our agricultural experience, and keep an advantage on a global playing field where most competitors are mega-funded multinationals.

It's time to start living in the future.

* Janet Tyson is a freelance editor, researcher and writer specialising in agriculture.