Silver Fern proposal a return to servitude of old

Silver Fern Farms meatworks. Photo / NZME.

Our legacy as forelock-tugging British colonialists dies hard. About the only time we stand tall as a nation is when our rugby warriors don the black uniform and go forth to do battle. Otherwise, it's as though we were born to be peasants, grumpily accepting the natural order of things.

Now it's leading meat company Silver Fern Farms, a farmer-run co-operative, preparing to perpetuate this tradition of subservience to others. The directors are proposing to sell off half the shares of the co-op to China's largest meat processor, Shanghai Maling Aquarius.

The cash-strapped local company will get a huge cash injection and the farmer owners an instant sweetener in the form of a special cash hand-out. The Chinese company will get a source of cheap meat to plug into the bottom of their integrated wholesale and retail business.

It's as though there's no institutional memory of the stranglehold giant British meat companies had on the industry stretching back through to 1882 and the first shipment of frozen lamb carcasses out of Port Chalmers to London. For the next century, the Vestey family for one, set up a chain of freezing works across New Zealand to ship largely unprocessed slabs of meat, in Vestey-owned ships, back to Vestey butcher shops in Britain.

It's not surprising that the Meat Workers Union was quick to attack the current proposed sell-off and worry about the potential impact on workers' pay and conditions. In the bad old days, farmers and meat workers alike were at the bottom of the chain in all senses of the word, the profits quickly exported to be amassed by the fabulously wealthy British owners.

The present proposal seems like a quick return to the servitude of old. Only the masters will have changed.

In the 1960s, when I was at university, there was something of a blossoming of nationalism across the university campuses. Poets like Allen Curnow, historians like Keith Sinclair and Bob Chapman, economists like Bill Sutch and Wolfgang Rosenberg all pushing the same theme. Curnow's poem after visiting the skeleton of the great moa at Canterbury Museum summed up the mood of the time. "An interesting failure to adapt on islands" he wrote, before adding a note of hope. "Not I, some child, born in a marvellous year, Will learn the trick of standing upright here."

The hoped-for Messiah Curnow wrote about is certainly not lurking among the Silver Fern Farms board members.

Of course, the meat company directors are not alone in continuing the tradition of sending our raw produce overseas for others to reap the profits. The ongoing export of ancient swamp kauri logs, while Government inspectors close their eyes to their almost unimproved state, is a case in point.

Then there's the pine logs, exported unprocessed in vast numbers, from plantations more than 72 per cent foreign-owned.

The Government's veto on Shanghai Pengxin buying Lochinver, the large central North Island farm, for $88 million, highlights a related issue. The overseas buyer was willing to pay $20 million more than the next highest offer from a local buyer. In other words, the profit these days is increasingly around farming the land for sale, not the crop or livestock. Like Auckland housing, it's the capital gain where the money is.

And over the horizon, it's not just foreign meat companies with large cheque books to buy the land. In 2010, global pension funds had $36 trillion to invest. While Act leader David Seymour wails about how the owners of Lochinver deserve compensation from the Government for any "loss" they might suffer from having to sell the farm locally, he ignores the other half of the equation. That is the effect such price explosions will have on the ability of young farmers to buy into the industry.

For years commentators have been worrying at the high cost of New Zealand pastoral land compared with the rest of the world. A 2014 KPMG research paper reckoned average pastoral land costs were nearly five times those of the US. In April, an ANZ report recorded farm prices leaping 24 per cent in the past year.

If we're not careful, the peasant farmers will not be able to even afford to own their own farms.