Agribusiness: Government agencies stellar job keeps agri exports flowing (NZ Herald)

There is a massive opportunity in front of us to capture premiums. Without doubt, our brand story is at an all-time high at the moment because of what we’ve done with Covid.

NZTE chief executive Peter Chrisp says the impact of New Zealand’s Covid-19 lockdown had immediate consequences for its customers — New Zealand exporters.

“I’ve always worked hard. I’ve never worked this hard,” Chrisp said at an interview at NZTE’s Wellington head office.

Even prior to the coronavirus pandemic hitting New Zealand’s shores, the agency was heavily involved providing support to its customers exporting to the China market.

“China is such a big market for New Zealand with many of our customers,” said Chrisp. “They needed to know what was going on and were desperate for insights. We had 65 people in China – we had to get them working from home. They were keen to contribute and lean in to support customers.

“So that was the beginning of it, and then it just unfolded, into Italy and South Korea.”

When New Zealand entered the alert level four lockdown phase, one of the immediate issues Chrisp’s team needed to face was how to support airfreight. With passenger traffic severely limited, there wasn’t a functioning airfreight market, which many of our high-value exports — including seafood and honey — depend on.

NZTE co-ordinated around 200 charter flights to key export markets, including Shanghai, Los Angeles, Tokyo, Singapore and Australia: “We got good backing from the ministers and the Ministry of Transport. We underwrote the capacity of the plane — the last 20 per cent of the plane.”

He said if a chartered plane wasn’t full it wouldn’t leave. The underwrite didn’t have to be used very often, but it was an important mechanism to provide certainty to exporters that their goods would make it to market.

In the medium term, a new initiative with funding allocated from the May budget will focus on supply chains, building firm capability in freight and logistics and helping to build capability within export firms.

Another of the initial challenges for exporters was ensuring sufficient cashflow for business continuity. NZTE formed partnerships with Deloitte, PwC and KPMG to provide a business continuity service for around 500 of its customers.

“From that, they got a bit of a plan about how to respond immediately, how to get their cash under control and what to do with their working capital and inventory,” Chrisp explained.

He said that while many exporters might be dealing with the current environment, they are starting to ask questions about the sales funnel and how to fill it long-term.

“I’ve been talking to some specialist manufacturers who would normally sell mostly through attending conferences, relationships with procurement mangers, and foot traffic. They are now wondering how they reach their customers.”

Many are turning to digital – which Chrisp said is one of the biggest things NZTE is engaged with at the moment. This will include scaling up e-commerce capability to provide digital commerce content, tools and advice to more exporters.

Keeping track of its current suite of clients, NZTE has developed a heat map that runs a ruler over companies and considers which companies that are thriving, surviving, or struggling.

Chrisp said this gave the agency a good feeling for where the hotspots were, and at the start of the crisis it was the export-dependant specialist manufacturing firms that he was most concerned about.

He said that though a lot of the customers of specialised manufacturing firms were considered essential overseas, they weren’t here — which had made things difficult.

The heat map is now showing around 32 per cent of companies thriving, 60 per cent surviving and about 8 per cent struggling.

“The thriving companies are across categories like food, manuka honey, nutraceuticals. But even in tech you’ve got companies involved with education software or gaming software that are doing well,” though Chrisp noted, you’ve also got people struggling in those categories as well. The Ministry of Foreign Affairs and Trade (MFAT) has developed a trade recovery strategy to address that. MFAT says the next phase of New Zealand’s response is recalibrating New Zealand’s trade policy for a new international environment.

The strategy, launched by trade and export growth minister David Parker, has three pillars: retooling support for exporters, reinvigorating international trade architecture, and refreshing key trade relationships.

NZTE will play a key role in this — in particular, Chrisp said it will be the custodian of the retooling pillar.

“The Government knew it couldn’t just rebuild New Zealand with a domestic fiscal spend. You need an international export recovery leg — and I think you need an investment recovery leg as well.”

Some of the $216 million funding boost it received through the Budget will be used to significantly increase the number of exporters that receive intensive support from NZTE. The agency says that collectively these exporters directly employ over 200,000 people. About 75 per cent of these firms are expected to be SMEs with 50 or fewer employees.

“We will have more customer managers that can deal with more New Zealand companies and services — and more boots on the ground in premium international markets,” Chrisp said.

Business development managers in key offshore markets will be particularly important for exporters while international travel remains restricted. It is envisaged that this team will be able to carry out additional functions for companies in-market – including meeting customers, vetting new employees, and selecting distributors.

Another portion of the funding has been allocated to expand the International Growth Fund, which helps reconnect companies with international markets and supply chain partners, as well as explore new opportunities.

Chrisp said he is keen to uphold the sense of the opportunity in front of New Zealand — particularly in the food and beverage sector.

“We’ve had food and beverage manufacturers in New Zealand that responded very well during Covid.

“The opportunity to be the most keeps agri exports flowing sustainable food producer on the planet is quite a niche — quite an exciting niche.”

One area that Covid-19 might help New Zealand is by spurring the acceleration of the shift from volume to value. Chrisp said food and beverage is at the sharp end of that.

“There is a massive opportunity in front of us to capture premiums. Without doubt, our brand story is at an all-time high at the moment because of what we’ve done with Covid. There is an opportunity to double-down on that brand story and those sustainability settings.”

“The health competitor advantage — growing food and beverage out of this healthy country and the intersection of innovation with our food and beverage story and our agritech sector, there’s some really great things that we can accelerate and advance around this.”

But, said Chrisp, a key challenge for New Zealand will be keeping the New Zealand brand alive in international markets over the next 12 months without international travel.

NZTE is working on strengthening New Zealand’s brand in priority markets by maintaining, promoting and broadening New Zealand’s brand appeal, particularly while the tourism sector is recovering.

Chrisp said it will re-emphasise New Zealand’s reputation for safety, trust, resilience, ingenuity, sustainability and high-value goods and services using the highly successful New Zealand Story strategy.

“When you think about who is probably likely to carry the New Zealand brand story, it is probably food and beverage and tech, because there are such good stories wrapped around those products and services.

“If our food comes out of a Covid-free country, it’s good for human health and it’s got a story wrapped around it about the quality of the country — that’s a particularly good story that will resonate in premium markets.”

Chrisp said it comes back to the underpinning values of kaitiaki — our role as guardians of people, place and planet and protecting what is precious over generations. We think that Covid has demonstrated that story.

“Our high integrity, high transparency, our very low corruption and our ingenuity — they are underpinning values that we think will resonate well on the international stage.”

Agribusiness: Covid impact felt in January in agribusiness (NZ Herald)

Ministry of Primary Industries chief executive Ray Smith says the impact of the Covid-19 crisis started early for MPI “as an agency”.

Smith says in late January, MPI started to observe the impact. Their biosecurity workforce — around 300 people at air passenger terminals — saw about 20,000 people passing through daily.

“The very first issue for us became the safety of our staff with the number of people coming to New Zealand,” he recalls. “At that point in time the concern was China. We acted early to make sure our staff had protective equipment. We were one of the first companies to give our staff PPE (personal protective equipment) and Perspex screens at the airport.

“While we had a few people that had Covid, none of them picked it up through the course of undertaking their work.”

By early February, MPI was countering emerging issues in the forestry sector with too many logs sitting on wharves in China. Similarly for rock lobster where 98 per cent of NZ’s crayfish is exported to China.

“Those were huge issues. But it was when we headed into lockdown that things really started to intensify.”

Following the lockdown announcement, MPI pulled together a conference call with people right across the primary sector. Smith says it was on that call that MPI set a standard for how it would operate through the crisis.

“People were incredibly grateful to be given the opportunity to continue to operate as essential services — there was a great fear at the time that many more things would be closed down.

“We were very clear about the gravity of the situation we were facing. But we had the potential to manage this well and show what could be done.”

Over the course of the following few weeks, MPI officials visited about 4000 premises. Smith says the agency set some high standards, and it was very challenging for some reasons — those in big processing areas like meat plants, dairy companies, horticultural pack houses — where there were large volumes of people working together. Enforcing those rules had a big impact on their productivity and he says MPI was aware of that. “But they adopted protocols, enforced them, and were actually grateful to have someone come out and verify from MPI they were adhering to good practice. We wouldn’t let each other down. It was a real test of positive relationships and working together to achieve a good outcome for New Zealanders.”

Says Smith: “It wasn’t easy in all areas. We did have some people in a couple of meat plants that had Covid, and in the dairy factory — but because of the protocols they never spread the disease, and it didn’t result in any closures. That level of cooperation, and the way we rallied together to get it right for New Zealand shone through and is something we can all be very proud of.”

The Herald put a number of questions to Smith:

Herald: How did you manage early on with your people in market?

Over February and March, we were bringing our people from China and Japan and other countries home. Our deputy director general for China relations — Tim Knox — went the other way. We felt that market was so important that we had our most senior person there throughout. He is still over there, and we have more MPI staff over in the next few weeks. We’ll back to our full complement by August. That has been an important priority for us — to have our people back in market.

Herald: Was there anything that really surprised you as you got further into the crisis?

The level of interdependence. We are managing a biological system, and it works on a season and pattern. You can’t turn off things for four weeks and just go back to normal.

Animals have to be able to reared, farmed, go into works and sold — or else you end up with a backlog somewhere. All of these things are heavily interdependent.

And there is a challenge for us around some of our systems when these crises hit. It was made worse for us because there was a drought as well as Covid. At one point there were worries about feed coming out of Malaysia — but all of these issues resolved themselves. My colleagues across government were critically important to making sure there was good flow at the border.

The forestry industry was largely closed. But we didn’t close it all down. The plant in Kawerau that produces chlorine, which is needed for our drinking water remained open. We have to have packaging materials so that our produce could be shipped offshore; paper produced for newsprint. We made an early call that we needed to allow people that work in nurseries to go and look after the plants. We couldn’t just close everything down — if those people stayed home, we would have lost more than one season of product.

Herald: What about the NZ brand story and implications for how the sector dealt with Covid-19?

The great thing going forward for New Zealand is how it has dealt with Covid has reinforced the confidence for NZ that you can trust the products that come out of it.

The e-certification of products into China emerged through this period as well, and became very important since documents were not able to flow as easily. There is a real opportunity to change things, because people have become more used to doing things digitally. I suspect in some ways our productivity was enhanced!

Herald: Are there any lessons for the future from dealing with the Covid-19 crisis?

We couldn’t have achieved what we did without having relationships, trust and a sense that we are all in this together. What I was really worried about was that New Zealand was making a huge sacrifice by keeping most people at home. When we were sending people to work — particularly in meat plants and packhouses with large numbers of people — we could not become a vector of disease through poor practice. But we proved we could do it.

Herald: What are the big challenges you are facing now?

We have a great primary sector, but one of the big challenges we will have is attracting more New Zealanders to come into the workforce as part of the recovery effort. We will have a campaign over the next few weeks to encourage Kiwis to come and work right across the primary sector.

Also maintaining our presence in market, and the inevitable levels of protectionism that might creep in as people see jobs disappear in other economies. And in getting that message out that New Zealand is here, we have great products, and you can trust us.

Agribusiness: FarmIQ software platform a bonus for farms (NZ Herald)

The FarmIQ farm management software platform is in use by over 4000 New Zealand livestock and dairy farms to support farm assurance, compliance, sustainability, productivity and traceability.

Most recently, it is now meeting new demands faced by the industry post-Covid.

The platform was developed as part of the FarmIQ Primary Growth Partnership (PGP), a seven-year programme that began in 2010 with the aim to create a demand-driven, integrated value chain for red meat that could grow the value of the sector by 50 per cent by 2025.

FarmIQ’s software is now jointly owned by Pamu Farms NZ, Silver Fern Farms, Farmlands, Veterinary Enterprises, and recently received investment from MSD Animal Health.

The agriculture industry is being disrupted by the rapid emergence of digital technologies, along with increasing compliance and regulatory requirements.

FarmIQ’s platform brings together all farming data into one place, helping farmers to run more productive, profitable and sustainable farming operations.

It combines detailed animal records with information about land, feed and people.

While some farmers solely use the platform for its recording and communication efficiencies, others use it to compare and learn from the results of changing practices like planting crops or mating hoggets at different weights.

FarmIQ chief executive Darryn Pegram says the only way you can meet today’s increasing demands is through digital technology.

FarmIQ’s software pulls together all farm information into a single dashboard.

By sharing farm data with vets, processors and regulators, FarmIQ is able to create value for the entire supply chain.

An example of the benefit of this was during the Mycoplasma bovis outbreak. A number of FarmIQ’s farms were able to use records dating back 18 months to identify the movements of their stock.

With this proof, the Ministry for Primary Industries was able to significantly reduce the necessary stock cull on these farms.

There is also a growing awareness and demand from consumers about their food choices, seeking traceability of food across the supply chain.

In major markets around the world, customers are prepared to pay a premium for sustainable food grown and produced in New Zealand. This is only expected to increase in a post-Covid era.

“By treating compliance as a by-product of productivity, it makes compliance easy and improves the quality of information that flows through the entire ecosystem,” says Pegram.

“FarmIQ allows producers to help tell the New Zealand provenance story on the world stage, while also demonstrating the integrity of its supply chain.”

He says the pandemic has accelerated digital transformation in agriculture and highlights the need for digital transactions.

“This is likely to continue to escalate, as demand and requirements for biosecurity and remote assurance steps up.”

Pegram says that FarmIQ’s software platform has the potential to create new value for farmers the world over, and the recent investment in the company by MSD Animal Health — a division of global healthcare company Merck & Co — is recognition of the considerable potential the FarmIQ platform has for use in global markets.

“We often field inquiries from farmers and agribusinesses in Australia and other countries that don’t have comparable products.

“We can see that as software becomes an increasingly important part of hardware offerings, we’ll have new opportunities to reach foreign farmers.”

Pandemic pivot

FarmIQ’s platform was able to help the industry quickly respond to the Covid-19 pandemic during New Zealand’s alert level four.

During New Zealand’s strict national lockdown, Synlait was able to continue audits on its farms with FarmIQ providing remote visibility of what was happening on-farm.

“Synlait were able to maintain their very high standards of food integrity while keeping their farmers, staff and auditors all remote from each other and safe from the spread of Covid-19,” says Pegram.

“The process also offers efficiencies and is popular with farmers as less time is spent on farm looking at records.

“Synlait completed the audits with a short physical visit once lockdown was over.”

While designed for farms, the FarmIQ team are using their software in their Wellington head office. All staff and visitors use the Safevisit app they developed with Farmlands for contact tracing.

“We knew FarmIQ was a fantastic biosecurity tool,” says Pegram. “But we didn’t really imagine it would be called on as a holistic solution for animals, plants and people too.”

Vision week day one – Opportunity NZ: why a vision is necessary (NZ INC.)

Visionweek NZ 2020 kicked off today, asking us to imagine if New Zealand’s five million-strong population set a vision for our future that ensures New Zealand’s long-term sustainability, productivity, resilience and high-quality outcomes for all people, communities and the environment.

The week-long programme features prominent New Zealanders, including Xero founder Rod Drury, Sir Stephen Tindall, economist Shamubeel Eaqub, Rocket Lab’s Peter Beck, former NZ chief science advisor Sir Peter Gluckman, Spark CEO Jolie Hodson and Auckland Transport’s chair Adrienne Young-Cooper.

The organisers say Covid-19 has created the conditions to reset our path, to take advantage of the huge opportunities that eliminating Covid provides, and to address some critical areas like climate change, equality of opportunity, and mental health where urgent action is needed.

Visionweek founder Paul Blair says, “A vision can create the ‘north star’ that links our team of five million, but it needs to quickly translate into a multi-decade, multi-partisan nation-building plan. Our plan needs to realise New Zealand’s untapped potential and put people, purpose and planet at the heart of transforming Kiwis lives for the better.”

Each day this week is focused on a different theme. Today’s is ‘Opportunity NZ: why a vision is necessary.’

Sir Stephen Tindall says the real opportunity is for us to come up with strategies that leverage our strengths. He notes our energy is 82 per cent renewable which is something the rest of the world is hugely jealous of.

“I’ve kind of seen with my involvement with both Rocket Lab and Team New Zealand, that if you use what I would call 21st century technology, and we actually gear up as a country to actually utilise and leverage that, we could do so much more than we’re doing right now,” he says.

Sir Stephen Tindall

“I’d love to think that every New Zealander thought through the sustainability lens and how much we could leverage that to our benefit, because there’s huge corporations around the world that want to invest in that. They want to impact investing into green things. We could be the microcosm of that in New Zealand, for them to learn how they can do it in their country.”

Panuku’s corporate responsibility advisor, Tessa Meyer, was recently awarded the New Zealand Green Building Council (NZGBC) Future Thinker of the Year for 2020.

Tessa Meyer

She says tackling the pandemic and climate change at the same time is daunting, and while it may be tempting to go back to normal, we have an extraordinary opportunity to use the resources that are at our disposal to tackle both challenges at the same time.

“I really hope that we can readjust some of our priorities,” she says. “Putting a green recovery, ahead of a simple financial recovery and investing in infrastructure that helps accelerate our de-carbonization and promotes environmental and social resilience. In 10 years’ time I would really like to look back on what we have done with this opportunity and know that we spent it on the right things.”

Professor Paul Spoonley says New Zealand is a small, relatively nimble country and is able to react to and develop new policies to address some of the negative consequences of Covid-19.

“It is an opportunity for us to really consider what a 21st century New Zealand might look like and to begin to shift resources and support and policy in ways that, privilege, the new way of doing business of living in this century.”

Professor Paul Spoonley

He says that baby boomers are now politically very significant and determining policy, but we’re not giving enough space and air time to some of the subsequent generations.

“I’m feeling excited, because I think there is a moment now when we begin to talk about our systems, our policies and the way in which we are going to operate in the future in a way that probably we would never have had without the pandemic,” he says.

Sir Peter Gluckman says the dynamic digital sector and entrepreneurship means that our geographical position in the world is not as disadvantageous as it used to be, because we are now more connected.

“We showed we can work very well in a virtual world, in a digitally connected world,” he says, pointing to Rocket Lab and Weta Workshops as examples.

Sir Peter Gluckman

Considering a Māori world view, Kono chief executive Rachel Taulelei says “while there is not necessarily one view, there is a commonality in and around values and the way that we might think intergenerationally.”

She describes it as being hardwired for collective responsibility for people.

“We have a particular relationship obviously with our land and our water. We revere them and we view them as our tupina, our ancestors. So, we love and care for them in a way that we might a brother or sister or a grandparent or any other relation in that respect.”

Rachel Taulelei

Visionweek has been made possible by the support of multiple partners, including Sustainable Business Council, Internet NZ, the Construction Sector Accord, EECA, Business New Zealand, the New Zealand Infrastructure Commission, the Ministry for the Environment, Infrastructure New Zealand and ASN Media.

All New Zealanders are invited to share their thoughts, using the hashtag #visionweeknz, so that as many viewpoints as possible can be integrated into the final report.

-Tim McCready