Better understanding, communication needed

Jeanette Maxwell
Jeanette Maxwell
Better communication and understanding within the red meat industry is needed to see better returns, outgoing Federated Farmers meat and fibre chairwoman Jeanette Maxwell says.

In her speech to the Federated Farmers national conference this week, Mrs Maxwell said it was a valuable industry, worth $6 billion to New Zealand's economy, but some of that value was not being felt behind the farm gates.

After consultation over the organisation's Meat Industry Options Paper, it had a clear indication from members about where the industry could improve and what was integral to the success of their farming businesses.

''While our central message has been a need for greater co-operation, the consultation period has identified a gap in understanding and communication between the stakeholders,'' she said.

An example was the relationship between the farmer and their processor.

''If you have been supplying the same company for the past 20 years and are going to continue to do so, you might consider yourself committed, but the company doesn't necessarily know your history or your future intentions.

''So unless they are communicated, no-one is going to benefit or be able to add value from it.

''Likewise with the processor to the farmer; if the farmer doesn't understand the processor's intentions or commitment, then you are unlikely to understand the value in committing to their business, and may choose to follow the spot market.''

Survey responses revealed 80% of respondents considered their meat company's strategy important, yet 43% could not describe it.

''To get central shifts in behaviour and maximise sustainable profitability, we need to better understand and align strategy values between suppliers and the company they supply.''

There appeared to be a genuine desire to come together, with 84% saying they were committed to a company at least seasonally, but the communication breakdown was preventing that commitment being leveraged from.

There were considerable opportunities for farmers to work with their stock agent or drafter to bridge the gap and keep communication open, she said.

Sheep and beef farmer confidence has risen to a three-year high, the latest Rabobank rural confidence survey showed.

While overall confidence dropped significantly, led by a slide in dairy farmer confidence, sheep and beef farmer sentiment recorded a healthy surge, with 57% of farmers reporting a positive outlook, up from 37% in the previous quarter.

Just 7% expected conditions to worsen in the next 12 months, down from 10% previously.

Rabobank New Zealand chief executive Ben Russell said the results reflected the strengthening in sheep and beef prices, on the back of lower supply from high slaughter levels in the past 12 to 18 months.

Rick Powdrell, of Bay of Plenty, has been elected chairman of Federated Farmers meat and fibre executive.

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