26 July 2022
In the depths of what is a wet and dark winter, with all the associated chills and ills, I was heartened to read an analysis of the primary sector’s performance over the past 60 years, and see in print what we all know is true – that the New Zealand horticulture sector has performed very well over this period of time.
The article is titled “Is the ‘volume to value mantra true? Yes, and here’s why”. It says that: “In almost every segment of the food and beverage sector there are minor miracles happening to make more from less”. For kiwifruit and apples, the analysis shows that the hectares harvested peaked and started to fall away many years ago, however, value – especially kiwifruit – has continued to grow, year on year. Plus, in the case of wine, both volume and value have continued to grow, at phenomenal rates since about 2000.
Professor Caroline Saunders, director of the Agribusiness Economy Research Unit that did the research, has looked into the attributes that set successful primary sector companies apart. She cites Zespri “as a good example of leadership in terms of sustainability and innovation”, saying: “The people with power – the retailers – still want products at a competitive price. But if you have a value proposition for a higher price… and market research (better insights) that can back that up, they are more likely to put it on the shelf”.
When I read that statement, I felt it was a more explicit way of explaining what we are constantly told we need to do more of: focus on value and not volume, because we are so small on a global scale. But, as this article pin points, that is exactly what the New Zealand primary sector has been doing, albeit quietly, since the 2000s: focusing on value.
However, before we get too smug, the article does conclude by noting that the “volume-to-value story is a slow burn” saying “it’s worth remembering that wine languished as an industry (in New Zealand) for 100 years”.
Which is why, while I wanted this column to be positive, I want also to underscore to all those involved in horticulture that we cannot be complacent. Our competitors have some advantages that we don’t have, which they are eager to leverage, so we must keep our foot on the accelerator, if we are to meet our sustainability and profitability goals for 2030 and beyond.