Government's Vision for the Sector
36. I recommend that the government's response broadly endorses the taskforce's overall strategy but takes it further.
37. While affirming the importance of maintaining and enhancing the sector's existing strengths, the government's response needs to place a strong emphasis on realising the transformative opportunities in new product development and new markets. For example, there are clear opportunities to develop high value export industries that leverage off New Zealand's primary industry expertise in agricultural technology platforms and systems. These core platforms include on-farm and orchard production, processing and food engineering, food safety, surety and traceability, phytosanitary assurances, packaging, inventory and logistics management and relationships throughout the value chain, including with retailers and category managers.
38. In addition the development of functional foods and nutraceuticals offers significant potential. In the dairy industry, work on identifying milk protein fractions such as lactoferrin has resulted in important high value products. Identification of protein fractions in meat and fish is not nearly so advanced, but is likely to be a source of significant new value in the future. New Zealand's disease free status imbues the resulting products with a unique advantage over competitors. A much more intensive effort, combining R&D and business investment, is required to develop these opportunities into significant businesses.
39. The response must also emphasise the mutual supportiveness inherent in efforts to improve productivity and sustainability, and that these twin goals are integral to the sector's use of natural resources and future development work.
40. It is important that the response provides sector stakeholders with a strong signal of the government's expectations regarding the sector's role in economic transformation. To achieve this I propose that the response incorporates the following vision, most of the points of which are also to be found in some form in the taskforce's work.
New Zealand's Food and Beverage Sector: A Vision of the Future
41. The government affirms that the Food and Beverage Sector, including associated upstream and downstream industries, is critical to achieving New Zealand's economic transformation. The government considers that a transformed food and beverage sector will display the following characteristics:
Nationally:
- innovation and commercialisation efforts are directed at meeting real market demands and are aligned across government, industry, education and research organisations.
- much greater collaboration, where practicable, in market development efforts;
- a diversified product base, stemming particularly from the space where food, nutrition, health and wellness intersect;
- strong investment and a high degree of entrepreneurial endeavour;
- transparency in producer returns, closely linking production to value and demand;
- attractive and productive work-places;
- a vibrant and innovative local food culture recognised internationally as a key part of New Zealand's national identity and fully integrated as part of our tourism offering and promotion;
- major ancillary industries including the development of several globally significant businesses in agritech and agbiotech;
- New Zealand products commanding premiums based on the use of verified sustainable and carbon efficient production systems combined with robust traceability regimes and a continued strong biosecurity regime;
- many more food and beverage firms with the strengths in design and marketing necessary to establish strong brands and grow significant businesses exploiting high-value niche markets.
Internationally
- the New Zealand food industry is integrated closely into the global food system, including strategic alliances with the users of ingredients and global super-market chains
- significant outward direct investment to secure ownership of more of the value chain, market share (particularly in growth markets) and all-year round product supply including production closer to markets;
- significant segments in the rapidly growing markets in Asia captured by new or improved products designed around and leveraging off New Zealand's existing strengths and capabilities; and
- new business models are utilised to establish global agribusinesses, including models appropriate for high growth strategies – this may require our larger firms evaluating alternative financial structures, including encouraging stand-apart start-up businesses with their distinctive entrepreneurial culture and management competencies.
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