Focus on farm profitability

Mike Petersen
Mike Petersen
Profitability is the focus of the recently announced $65 million Collaboration for Sustainable Growth programme in the red meat sector, Beef and Lamb New Zealand chairman Mike Petersen says.

In his latest chairman's update, Mr Petersen said he had received calls from farmers supporting the programme but questioning why farmers seemed to be always asked to do more with regards to productivity in the absence of good news and progress from the wider industry.

There was no doubt farmers had continued to make real progress in productivity or efficiency gains but, as in any business, there was always opportunity for ongoing gain, he said.

''What is not often appreciated by farmers is the incredibly complex nature of our meat processing sector, with the reliance on biological and weather-dependent supply, alongside the need to market all cuts profitably in the disassembly business which is the meat industry.

''Overlay that with our distance from markets and currency challenges and we are talking about a tough business,'' he said.

Up to $32.4 million from the Ministry for Primary Industries' Primary Growth Partnership Fund (PGP) has been approved for the seven-year programme.

The farmer contribution was about 30% of the total programme investment, representing $2.33 of partner support for every $1 invested by Beef and Lamb NZ on behalf of farmers, Mr Petersen said.

With the other 70% coming from Government and industry participants, the vote by farmers, alongside Beef and Lamb NZ's annual meeting on March 8, would enable the programme to progress.

Following completion of the programme, Mr Petersen believed the following would be achieved:

• The ''social science'' part of the programme would provide valuable insights into how farmers learn and want to receive information.

• Farmers would have access to real-time benchmarking to evaluate how their business was performing relative to others in the area, on the same class of land and right across New Zealand as well.

• The benchmarking would use common language that was agreed across the industry to allow meaningful evaluation of on-farm performance.

• The ability to analyse farm business management and performance would be greatly enhanced, flowing on to a greater understanding about how the wider industry operated and performed.

• The same tools and services would be available through and supported by a much wider group including advisers, meat company representatives, banks and other service providers and professionals.

• The industry would be future-proofed, with the enhancement of its image and reputation as environmentally friendly, ethical and safe food producers.

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