A visit to China has highlighted that the Silver Fern Farms-Shanghai Maling joint venture is a "real leg-up'' into the market, Federated Farmers meat and fibre president Rick Powdrell says.
Mr Powdrell, a Te Puke farmer, was asked to join a group of Silver Fern Farm shareholders for a China tour.
The opportunity to get into the Chinese market and farming systems and gain a more accurate understanding of what was going on in China was too good to turn down, he said.
He had been supportive of the joint venture since it was first announced, Mr Powdrell said.
During a meeting with Shanghai Maling representatives last year, he asked "some hard questions'' and was satisfied it was going to give Silver Fern Farms that leg-up.
His first visit to China - a country and market he found both diverse and complex - reaffirmed his belief the joint venture would yield results, although how they were achieved was another matter, particularly given the volume of Australian beef in the market, he said.
China was taking a lot of lower-grade lamb cuts and the process of integrating higher-value cuts into the market would not be easy. But it would be easier with the Shanghai Maling presence, he said.
Partnering with a foreign company was an easier way of getting a better understanding of the market as well as access to that market and he believed people accepted it was the "way of the future''.
It was now a waiting game until the Overseas Investment Office announced whether it would approve the proposal.
"Should that be turned down, then we'll be in a very interesting space. I would like to think it won't be. You never know with these things,'' he said.
As to the effect on the red meat sector if it did not go ahead, he said, "I think it would certainly throw the cat among the pigeons again and there would be a re-jockeying - and just what that means, I'm not really sure.''
Owaka farmers Peter and Nellie McNab wanted both to see China first hand and look at all the opportunities they had been told about, as well as gain an understanding of the complications.
Mr McNab said he was initially apprehensive about the Shanghai Maling deal but, as time went on, he came to believe it was going to be "a very good thing'' for Silver Fern Farms.
He urged farmers to grasp the opportunity, saying he was quite sure that, in the long-term, it was going to be good for the company.
China offered some amazing opportunities but also many complications. He believed the the Shanghai Maling partnership would overcome quite a lot of those, particularly in the start-up phase.
It would put Silver Fern Farms "on the front foot'' when it came to securing some of those opportunities.
Long term, there was huge demand for high-quality premium products.
What needed to be done was to extract more value from that market.
Farmers had to do what it took to produce those premium products and that was going to be the result of a combination of management and breeding.
Year-round supply was also something that was going to have to be examined, and North Island producers were better suited to that, he said.
