24 Jun 2009

Meat sector's attitude seen as major constraint to growth

3:29 pm on 24 June 2009

A new report into the meat industry has highlighted the culture and structure of the sector as being a major constraint to it becoming a sustainable industry within the next decade.

The Ministry of Agriculture surveyed farmers, processors, marketers, international customers and Government advisors on how they see the industry in 10 to 15 years.

Many of those surveyed said they want an industry which invests in innovation, has a greater focus on the market and is more co-ordinated across the value chain.

However, they were not confident that the vision would be achieved.

The report highlights a lack of incentive for farmers to invest in their co-operatives, a structural overcapacity in meat processing, the potential for suitable farming land to shrink and the spot market relationships between farmers and processors as the main obstacles.

However, it points out that there are some opportunities for the sector to become more aligned and better connected across the value chain, as well as generating higher returns.

MAF policy deputy director-general Paul Stocks says the report is designed to stimulate debate in the sector about the best way forward, by outlining four key scenarios about what the industry may look like in 10 years.

Mr Stocks believes the report will stimulate debate that he hopes will be helpful to the sector.

Comments from the Meat Industry Association in the report agree that profitability and investment in innovation, marketing and supply chains are the key areas of concerns for the sector.

However, it says it has difficulty accepting a suggestion that the meat sector is broken or systematically under-performing.