Farmers keen for industry changes
Hundreds of farmers frustrated with volatile lamb prices called for consolidation of the red meat industry at a meeting in Gore yesterday.
The farmers arrived en-masse for the meeting, which was hosted by the newly formed Meat Industry Excellence Group, at the Town and Country Club.
ANZ chief economist Cameron Bagrie's comments were met with applause when he said the red meat industry needed one big player and four to five smaller ones to keep the others honest.
"We're playing farmer and meat processor against each other time and time again," he said.
Those at the meeting supported the concept of an 80 per cent model in the meat industry, but it was up to both the meat industry and farmers to make it happen because they owned the country's two largest meat companies, Silver Fern Farms and Alliance.
Tapanui sheep farmer Fiona Hancox said farmers were over the roller coaster ride of lamb prices.
"We've had two good years in 10 and it just doesn't stack up.
"We want viability and transparency from meat companies or people will continue to leave the industry," she said.
Mrs Hancox said there needed to be a strong sheep and beef industry with red meat marketed under one structure and farmers needed to change their culture from chasing the best lamb price to committing to long-term supply contracts that would see loyalty rewarded.
She also believed all suppliers should be treated fairly and equally. "The single-biggest frustration I'm hearing from farmers is that they are not being treated fairly."
Both Alliance chairman Owen Poole and Silver Fern Farms chairman Eoin Garden, who attended the meeting, said they supported the concept of an 80 per cent red meat industry model and that they had been in talks with other industry players.
"It's easy to talk about but it's hard to achieve," Mr Poole said.
Mr Poole said he had tried to create an 80 per cent model five years ago, but Silver Fern Farms was in talks with PGG Wrightsons at the time.
Mr Garden said the key to improving farmer returns was getting the markets to pay more for lamb by packaging it correctly.
"They [consumers] are the second most important stakeholder.
"They make the decisions as to what food they buy," he said.
Meeting chairman Gerry Eckhoff said the "tipping point" for sheep farmers was not far away.
"We cannot control the climate or the currency, but having the right industry structure will shelter us to some degree."
Mr Eckhoff said farmers also had to adapt to a changing environment or they would not survive.
"In the animal kingdom a species becomes extinct if it doesn't adapt to a changing environment.
"We are responsible individually and collectively for our own futures."
Massey University professor of agri-business Hamish Gow said there was no silver bullet, but the industry needed to collaborate and be innovative.
The Southland Times