The negative forces surrounding the coronavirus continue to put a squeeze on returns coming back to New Zealand exporters and onto growers. There is barely a sector in the primary sector that is not adversely affected to the point where some days ago a -0.4% drop in GDP was being predicted and arguably the situation has worsened since then.
Meat schedules are still falling as is wool and timber crews are being laid off due to no log sales at present to China.
China is predicting a full -1% drop in there GDP for the current quarter with business seeking government loans to help keep staff employed and firms afloat.
Outside of China, at the moment it appears one of the worse hit sector is education with the numbers of Asian-sourced students drying up and really no chance to recoup these losses.
Dairying, while affected, seems to be less impacted than most other sectors at this stage. This is due to the biggest half of the season already behind us and returns are already in the bank and it appears that milk powder is less of a discretionary spend than many products. Some analysts have lowered their farm gate price forecasts, but the bulk are still keeping to their earlier predictions.
I had a recent opportunity to listen and speak with Angela Clifford, CEO of Eat New Zealand and she highlighted the opportunities that are available within New Zealand. Eat New Zealand are an organisation whose aims are to encourage and promote quality food production and help make New Zealand a food destination. A common bandied figure is that New Zealand produces enough food to support 35 million people and we export the vast majority of our food products to access these folk.
Angela made the point that within New Zealand along side of our 5 million residents we have another 5 million visitors. Quite a way short of 35 million but still a sizeable percentage and right within the house let alone on our doorsteps and with a lot less costs involved. When one thinks of countries like France and Italy among others the image of being able cruise through villages or cities and spend a large period of time sampling the local flavours be them wine, cheese or specialty regional foods comes to mind. At the moment, I can’t say that image is conjured up around New Zealand.
There are pockets in our major cities but on the whole, they are hardly uniquely New Zealand experiences. The Kaikoura coast used to be renown for the supply of freshly cooked crayfish outlets which travellers were able to partake. Now there is one remaining and with limited time open due to their restricted quota. Overseas visitors are aware of New Zealand’s crayfish reputation from access to it overseas and look forward to the real thing when visiting. Apparently, the best way now to obtain the delicacy if you are a tourist is to join a day trip in which lifting a few pots is part of the deal and take the crayfish back to the motel and have a ‘boil up’ in your room. The moteliers are wrapt. Prior to the China shutdown over 90% of all crayfish caught was exported to China effectively cutting the domestic and tourist trade out of the market.
This is perhaps a more extreme example but highlights the opportunities that are available and not being taken.
New Zealand can produce a vast array of high quality foods and while not unique to just New Zealand we can provide a great story and friendly service to accompany it. The coronavirus has brought home the risks of having arguably too much of our exports targeting one market.
It happened before when the UK joined the EEC (EU) and while many have highlighted the risks the ‘easy’ returns have been too tempting to resist. No doubt the tourist trade is/will be affected by the coronavirus as well, but it does provide a broader base and along with exports perhaps at a more circumspect level and still including China among others, a more resilient economy may arise.
New Zealand has a considerable way to go before it can consider itself a food destination but now could be the right time to do a re-evaluation of what it does with its food resources. A future where we can develop regional styles and differences for the products each region has available and a competitive advantage to me sounds a lot more interesting than just sending yet more product offshore. Perhaps one of the major handicaps will be the fact that so many of our major processors are owned by the Chinese. This latest challenge with coronavirus perhaps illustrates another reason why maintaining control of our resources is so important.
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12 Comments
In the 1970's, we use to order crayfish and yes at the Maketu fish and chip shop. From memory, it wasnt more than $5.00 total.
This country was blessed back then; at least until Roger failed enomics. A failed pig farmer, who got us to swalllow neo liberal free market economies hook line and sinker, which sold us out to overseas interests.
We need to right the ship by taking the sustainable approach going forward; much like the scandinavian countries. Dont flow China or the US, because their approach is not sustainable.
Meanwhile a heavy reduction in allowable cray and other fish catch along the Kaikoura coast is being advocated for after the earthquake triggered temporary catch restrictions are lifted - except for commercial fishers and Iwi for whom it is proposed quotas stay the same or increase. A small number of locals whose wider community is highly dependent on the tourist trade think industrial scale catching and exporting of crays to China should displace visitor food experiences and traditional kiwi kai gathering.
Recreational fishermen have a lot to answer for as well. I see plenty binning up on cod, snapper, tarakihi etc - 30 fish per person per day many of them just of legal size. Same with crayfish and paua.
My suggestion would be halve daily limits at the least and put harsher penalties on poaching without warnings e.g. loss of boat and/or fishing equipment rather than a slap on the wrist
How many people could NZ feed without fossil fuels? Certainly not 35 mil I'd wager.
With no Haber–Bosch process, fertilizer from Africa, tractors, trucks, etc. we'd be struggling to feed 5 mil.
Urbanisation covering productive land next to ever growing population centres is another problem.
However, the proposal above would be an improvement on what we do now in my humble opinion.
Having spent many years outside NZ in my early years it wasn't that hard to realise how good our food really was. Those who haven't had that experience may feel differently, of course, but even in great countries like Australia, the UK & USA the standard of most quick foods was pretty average - like here is as well, I suppose. But in basic things like milk for example, they were all below par, as were many other countries I could name. It wasn't until we got to Western Europe that the many cheeses kicked in, the different beers available, the huge chocolate choices etc. that I noticed that we were a bit behind trend. Even today when I ask my wife shall we winter over in Australia somewhere, she tells me the coffee's no good & she's sick of having chips with everything & would prefer to visit her brother in Ohau as at least he can cook. My point being is that we have always had great food in NZ. My father's garden was a sight to behold. Parts of it fed us for 6 months of the year, the potatoes lasted 9 months. And we still have great access to great foods every day in this nation, a lot of it local. I would love NZ Inc to be a foodie destination. There's no shortage of talent & no shortage of great foods coming through the system, as a visit your local market or food show will testify to.
We would rather buy cheap garbage fish cakes from the supermarket than buy local fresh produce. The big corporations have priced local grown produce out of the retail market. With their monopsonies on NZ produce they dictate to growers what price they will pay.
Whanganui's last retail butcher (excluding homekill) has closed. Only one main local market gardener that sells directly to customers.
The Walmart effect
There is a significant market for authentic visitor wild Kaimoana gathering and/or eating experiences yet in few places in NZ do we successfully exploit this high profit margin tourist group. Guy's article displays a depth of vision that is lacking in our country. We bulk export our premium species and give no thought to the great things that could be achieved by a targeted strategy. Anyone who has travelled through overseas coastal communities will have experienced the plentiful availability of local wild seafood at multiple roadside shops and stalls. By comparison our offerings to tourists are, outside high end restaurants, pretty sad.
You forgot huhu grubs. Pile of rotten logs, supply tourists with spikes to dig them out, fry them while they wait. True story; we were gathering paua adjacent to a tourist route when a fashionably clad asian tourist delicately picked her way over boulders to us in her high heels. She wanted to buy some paua, waving rutherfords under our nose. We said 'no, no, police, prison'. Then my disreputable unshaven mate indicated his unlovely face and said 'kiss, we give you'. The look on her face was pure gold, she recoiled disgusted but after a brief hesitation leaned forward and gave him a peck on the cheek.
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