29,200 copies distributed monthly – to every rural mailbox in Canterbury and the West Coast.
March 2014
INSIDE Deer processors closer Page 2
Bobby calves’ welfare important to NZ Inc Page 4–5
A quarter century of farming excellence
Page 8–9
Cradle of the national cattle pool
CONTACT US Canterbury Farming 03 347 2314
to unified marketing
By Hugh de Lacy
Beef and lamb processor-marketers may still be cutting each others’ throats in overseas markets, but the deer industry is taking a unified approach to looming opportunities in the Chinese market. The top five venison exporters — Silver Fern Farms (SFF), Alliance Meats, Mountain River, Andrew Duncan and First Light Foods — have teamed up with Deer NZ to develop a Chinese strategy to attract development funding from the Government’s Primary Growth Partnership (PGP) scheme. At present only Mountain River, based near Rakaia in Mid-Canterbury, has been accredited to export venison to China, but half a dozen other export plants have made accreditation applications that have yet to be approved. “We’re putting together a business case for a PGP, and there’ll be an angle on productivity, farm profitability and the market,” Deer NZ chief executive Dan Coup told Canterbury Farming. We’re working hard on getting the deer industry better access [to China]. “The beef industry’s got similar issues — the sheep industry is reasonably sorted, but some plants are still waiting for their listing as well,” Coup said.
Once the Chinese approve more venison plants, there will be an opportunity for the industry to take a co-ordinated approach to that vast market, an approach that continues to elude the beef and lamb industry. “Today’s reality is that we have got those (venison exporter) guys on board with the concept thus far, but we haven’t nailed the thing down yet,” Coup said. While China was ‘the obvious growth market’ the PGP business model would not be ignoring the traditional continental European market, which still absorbs most exported venison, and the smaller North American and Australian markets. After putting in an application to the Ministry of Primary Industry (MPI), Deer NZ got the green light to go ahead and develop its PGP plan with the backing of the exporters and the Deer Industry of New Zealand (DINZ). “We need to get broad agreement across all those marketing partners, and we need to get it down to a reasonably
fine level of detail so nobody gets surprised later on.” Coup said a common brand for all exporters into China was “one possibility,” with the Cervena appellation used in the European market offering a basis for discussion. “If we could extend that use of common imagery of the product into other markets, that seems a pretty sensible way to go.” Venison sales to China have increased exponentially since 2010 when 5,500kg worth $100,000 was sent. Last year 222,000kg of frozen meat and 1,300kg of chilled product earned this country about $1.1 million. This has helped stabilise prices in the traditional markets which, during the early years of the industry, fluctuated wildly from year to year. Similar stability has entered the velvet market, with China now absorbing more product than the original South Korean market, which was also prone to yearon-year fluctuations. Coup said the velvet market had contributed to slowing the
contraction in the deer industry caused by the continuing expansion of dairying in response to China’s seemingly insatiable appetite for New Zealand dairy products. Velvet price stability was encouraging more farmers to retain stags for velveting. The value of velvet exports peaked at $31m in 2011 before dropping to $25.5m last year, but is projected to recover to $26.5m this year. “Velvet prices have been comfortable and stable for the last three or four years, and we’re expecting some growth in velvet stag numbers at a time when deer numbers are probably still receding a little,” Coup said. Including Hong Kong, China now takes more than half of New Zealand’s velvet exports with Korea taking much of the
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rest, and there’s a small but growing market in the United States and other developed countries. While the deer industry moves cautiously towards a co-ordinated marketing system, pressure is building on beef and lamb to bring the two big farmer-owned co-operatives, SFF and Alliance Meats, together to form the basis of a similarly unified marketing structure. The Meat Industry Excellence lobby group (MEI), which has succeeded in getting members elected to both co-ops’ boards of directors, has recently asked industry body Beef and Lamb NZ for $200,000 to help fund its activities. MIE members, chaired by Ohakune farmer John McCarthy, have met the group’s costs out of their own pockets so far.