6 Dec 2008

New joint venture company to market deer velvet

3:45 pm on 6 December 2008

PGG Wrightson is to form a joint venture with another company to market deer velvet to key Asian markets.

The rural services firm is launching a new company with Tasman Velvet Processors as a platform to do this.

The agreement follows doubts an agreement would succeed, after the Velexco, a deer velvet co-operative, dropped out of the talks.

PGG's general manager of velvet, Conrad Wilkshire, says the new company - the New Zealand Velvet Marketing Company - will be responsible for marketing two thirds of New Zealand velvet sales to Korea and China.

He says velvet is not immune to slackening demand for exports and decreasing prices, and the sector needs to seek strong partnerships to maintain demand during the economic slowdown.

Ownership of the new marketing company will be split three ways between PGG, Tasman Velvet and farmers.