The latest survey of opinion and focus in the agribusiness sector throws up some significant differences between younger managers, older governors, and the farmers in the industry they lead

Recently KPMG held their “Agribusiness Agenda” programme which they have been conducting for several years. This year’s programme was named “Energising a world of anxiety” and was looking at what would help to achieve greater productivity and positivity across the nation.

This seems to be somewhat of a theme at the moment. Attendees to the programme were of a mix of 160 agribusiness executives and governors.

As part of the programme a survey targeting the priorities needed to help lift the country forward was conducted.  KPMG also did a split of the executives into young and emerging, and current (older). The results and discussion of the survey, to me, was of greater interest than the rest of the proceedings which the above link can direct readers to.

Overall groups, the top concern was the need for “World-class biosecurity”. In itself this is not surprising but perhaps the interesting aspect is that in the Fed Farmers 6 monthly survey published last January biosecurity didn’t even get onto the score sheet (this survey is included at the bottom of the article).

The top three priorities below all relate to aiding or protecting New Zealand’s export ability. These appear to fit with both government and main opposition parties reading as well. Securing additional FTA’s are always high on their agendas and while biosecurity often appears to be closing the gate after the event, the commitment to eradicate M Bovis certainly shows government takes protecting primary industries as very important. Both National and Labour are both looking to lifting the ability of businesses to utilise migrant labour. As the survey was conducted after Cyclone Gabrielle it is not surprising that topics around resilience have emerged.

Those that have dropped out as a result are below. There is no water-related priority in the top 10 this year. A comment was picked up that “Leaders are just not talking about water and water resilience”. Water has to be one of New Zealand’s best competitive advantages, so its absence is somewhat surprising. Last year both point 10 and 11 related to water quality where they are now 16 and 33.

When "executives" results were separated out from "governors" (as below) some subtle differences were shown up. The executives who work closer to the cliff face and a younger cohort (this as a possible clue to the differences) had sustainability issues at a higher priority although some contradictions to this also showed up. Notably governors had water storage far higher as they did for rural resilience. Yet compared to executives they had food insecurity in NZ and supporting land use change arguably both more social sustainability issues will down the list.

Below is a snapshot of the Federated Farmers January survey - no doubt done in a different setting and certainly before Cyclone Gabrielle. A likely consequence of the pressures farmers are under is that it is more inward looking. Although the fact that the KPMG survey has not picked up any Climate Change policy issues except as No 9 in the “emerging leaders results’ is a little surprising. This may reflect the differences those living in the rural areas are feeling to those from the urban sector. Having said in the conversations recorded one contributor noted that it is possible to transform New Zealand into a climate-positive country within a single generation if we bring the right mindset to the problem, but not if we continue to allow productive food-producing land to be transformed into ever larger permanent exotic forestry plantations.

With the Climate Commission highlighting that offsetting is not a long-term solution to the climate challenges we face, there was widespread agreement that there is an urgent need to take a pause on greenlighting foreign investment in carbon forestry and develop a more holistic policy response that also considers the impact these developments are having on our rural communities and other alternative land uses. However, this has not come through that strongly in the survey results. The review of the ETS settings and the Permanent Forestry Category hopefully will resolve this issue.

Perhaps as a response to much of the anti-regulatory rhetoric coming from some in the agriculture sector, a point made by several contributors is that; when it comes to regulatory benefit, the most common nexus that is drawn is between a piece of regulation and the creation of a market premium. The reality is that most regulation is not intended to underpin a market attribute that a consumer is prepared to pay a premium for but is designed to protect the sector’s license to operate and a ticket to play.

The challenge arises when the promised premium from regulation does not materialise, leaving those having to comply with costs but not necessarily any additional revenue.

This can quickly start to undermine morale and leave people questioning the need for the rules.

While the regulation may have stopped revenue from falling, it was highlighted that there is a need for regulators and industry leaders to be more realistic about the outcomes that any regime is likely to deliver, as promising benefits where there is no certainty of realisation is a key factor undermining regulatory confidence. Many farmers can no doubt relate to this with constantly hearing how they will be rewarded in the market for their ‘sustainable’ practises but would like to see it relate more to their balance sheet.

Ensuring our story is substantive, is more critical than ever. The New Zealand brand can be a superpower, but it was suggested that we recognise that there are many around the world (competitors, activists, and governments) are looking for any shortcuts to find reasons not to buy our products. The markets we have returned to differ from those we operated in before the pandemic. Countries are putting significant effort into building domestic food resilience, which is changing how they think about imports, supporting local producers, and incentivising consumers to buy locally sourced products.