They could be accused by farmers of overoptimism, but farming
leaders remain upbeat about the future of red meat
production, while warning that investment was needed in
marketing and markets diversified.
Meat and Wool New Zealand chief executive Scott Champion told
a recent Silver Fern Farms sheep and beef forum in Gore the
fundamentals for red meat remained strong, and the number of
affluent customers who wanted to eat red meat was growing.
With the world's population expected to hit eight billion by
2030, global food production needed to double, and Mr
Champion said while New Zealand could not feed the world, it
had to decide exactly for who it was going to produce food.
The population in existing red meat markets was static or
falling, so it was likely new consumers would be in China,
Central Asia and Africa.
The consumption of beef in China between 2001 and 2006 grew
faster than in the United States, he said.
"Traditional markets will remain crucial, but opportunities
will come from new markets."
Another issue facing food producers was the loss of
productive land, which meant new technology and efficiency
would be crucial in the future.
In 1966, the world's population was 3.5 billion and the area
of productive farmland was just over 0.4ha per capita.
In 2030, Mr Champion said the world's population was forecast
to reach eight billion and the available area of productive
farmland to fall to just over 0.15ha per capita.
But it was not a case of grasping any technology, as
consumers of New Zealand products were still likely to want
food that was safe, ethically produced and could be traced
back to the producer.
Change was already happening.
In 1970-71, more than 90% of New Zealand lamb was shipped in
frozen carcass form.
Even as recently as 1995-96, frozen carcass sales made up 30%
of lamb exports and chilled 10%.
Today, chilled lamb exports represent 25% of lamb exports,
frozen boneless cuts 10%, frozen cuts just over 60% and the
balance, less than 5%, frozen carcass.
While New Zealand's European sheepmeat quota would ensure
that market remained a key, Mr Champion said Asia would
continue to grow in importance.
But New Zealand exporters would not have it all its own way,
he warned.
Low-cost competitors from China, South America and even
Australia would compete for market share, and the fact lamb
was now established as an expensive niche protein was both an
advantage and a problem.
Combine that with falling production globally and Mr Champion
said lamb could start to struggle for chiller space, while
the food service sector did not understand the merits of New
Zealand grass-fed beef.
For these reasons, product education was needed, Mr Champion
said.
Silver Fern Farms chief executive Keith Cooper told the
seminar new markets required new thinking, not only in the
final products but also in the raw material supplied by
farmers.
He said in the future farmers could work with their meat
processor, and science and genetics companies such as
AgResearch, as part of an integrated supply chain to produce
products wanted by customers.
An example was the Marks and Spencers market for lamb, in
which farmers had to meet certain criteria, and the
McDonald's Angus beef contract, in which animals must be
verified Angus.
Commodity cuts would remain a significant market, especially
for beef, he said.
SFF chairman Eoin Garden also warned about low-cost
competitors, saying South America had addressed production
issues and would become "an agricultural powerhouse", with
potential based on a moderate climate and scope.
In 10 years, Brazil had shifted from a beef importer to an
exporter and three of the world's largest beef processing
companies were now Brazilian-based.
One of those companies, JBS, controlled half of the US and
46% of Australian beef processing capacity, and recently it
bought four lamb processing plants in Australia.
