NZ primary sector businesses mull plans for growth at Stanford 'bootcamp'

Wednesday 1st July 2015

New Zealand’s largest primary sector businesses, including meat companies Silver Fern Farms and Alliance Group, seafood groups Sanford and Sealord, and milk processors Fonterra Cooperative Group and Miraka, are on a bootcamp in the US this week to work together on ways to add value to the country’s primary goods exports.

The group of 50, which includes chief executives of many of the companies as well as representatives from government agencies covering primary industries, trade and enterprise, and free trade negotiations, are convening at Stanford University in Silicon Valley, California, to plan how to boost New Zealand primary exports, which account for almost three quarters of New Zealand’s merchandise trade.

The government wants companies to add more value to commodities to help reach its target of doubling primary exports to $64 billion by 2025 from $32 billion in 2012. Agricultural producers are optimistic that targeting higher value niche markets and increasing the value of goods rather than the volume will better insulate them from fickle commodity price swings.

“We feel that the discussion should move from being a price taking country into one where we become much more market shaping,” said John Brakenridge, chief executive of New Zealand Merino, which helped set up the annual bootcamps in 2012.

“It’s a matter of understanding about what you need to do to shift. Instead of us as individual businesses going and doing our bit in market, we are looking for areas of collaboration and understanding and sharing of insights.”

The get togethers led to the setting up of a marketing hub for New Zealand primary producers in the horticulture, seafood and farming sectors in Shanghai opened by Economic Development Minister Steven Joyce in April.

New Zealand’s small size means its companies are well placed to work together, Brakenridge said.

“We can just get on the phone and ask ‘how do you feel about collaboration?” he said. “We’ve got a huge opportunity to lead the world in this. It enables us to be far more strategic in how we are approaching these global markets.”

KPMG’s global head of agribusiness Ian Proudfoot, who has attended the bootcamp, said in his annual Agribusiness Agenda report published last month, that New Zealand primary sector businesses need to focus on achieving premium prices for products by taking greater control through the supply chain, and getting closer to consumers.

NZ Merino’s Brakenridge said Silicon Valley’s ecosystem, involving a mix of universities, business and venture capitalists, would help New Zealand companies understand how they could better work together.

Speakers at this year’s event will include sustainability specialist and architect William McDonough, Stanford professors, and business executives from local companies such as Google as well as from start-ups.

BusinessDesk.co.nz

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