The Tai Tokerau Northland Growth Study was published by the Primary Industries Ministry (MPI) in association with the Ministry of Business, Innovation and Employment.
Two further regional growth studies are under way – in Bay of Plenty and Manawatu-Wanganui.
“The innovation centre concept was at an early stage and a full feasibility assessment had to be commissioned,” the report, written by research and policy advisory firm Martin Jenkins, said.
It should not overlap with any existing research institutions and the demand for the centre’s services from the relevant industries needed to be established.
The project was initiated by the Northland Dairy Development Trust.
The concept of closed loop farming using dairy farm effluent for aquaculture such as carp farming that could in turn be used as animal feed had been put forward.
The innovation centre was included in a section of the potential for Northland’s dairy industry to expand by improving farm management, bringing more Maori-owned land into production and by lifting investment in research and development.
The report said more than 900 herds on 187,000ha produced 5.5% of the nation’s milk in 2013.
However, Northland had the second-lowest profitability per hectare after West Coast-Tasman and had the lowest productivity figures in the country, per cow and per hectare.
That was partly because of smaller scale, lower fertility soils, weather incidents, Maori land ownership and lack of industry attraction for young people.
Opportunities to make significant gains from even incremental increases in productivity had already been recognised by farmers, the industry, local government and tribes across the region.
MPI said the area of Maori land under dairying could more than double, from 4600ha to 10,200ha, if that lined up with the aspirations of the landowners.
Maori aspirations for manuka honey production were also mentioned in the report, given the amount of Maori-owned land under native trees and the establishment of an apiary studies programme by Te Rununga o Te Arawa in Kaitaia in conjunction with Telford.
The forestry industry was also challenged by the Tai Tokerau growth study to come up with ways to add value with a combination of lower-grade processed products and higher-value engineered products.
Exotic timber volume had doubled in the past five years to 3.5 million cubic metres annually, of which 2m left the province as logs.
“Redirecting 1-1.2m cubic metres from log exports to wood processing could add $250m annually to regional GDP,” the report said.
Northland’s economy had been underperforming for
a long time.TAI TOKERAU GROWTH STUDY
Among the suggestions were a saw and pulp mill near Kaikohe, using energy from the Ngawha thermal field, and a totara wood processing avenue.
Earlier reports indicated 200,000 to 350,000ha of unmanaged totara stands across Northland that might provide enough quality wood for consistent production until new plantings became available.
Considerable improvements in growth and quality of totara wood had already been demonstrated by the Farm Forestry Association, Totara Working Group and Tane’s Tree Trust working with Scion.
Totara would also need a brand story that emphasised indigenous resources, sustainability, environmental benefits and superior product qualities.
“The next steps are to do further analysis of market demand, pricing, financial modelling, harvesting planning, pilot processing and to confirm a base of interested investors and key partners to provide a full business case,” the report said.
The potential for a kingfish aquaculture facility at Bream Bay, building on the work already done by NIWA, was highlighted.
More than $10m would be required and the project would have a lead time of 10 years to commercial sustainability.
“A full, detailed business case needs to be developed as a priority,” the report said.
Northland’s economy had been underperforming for a long time – it accounted for 2.6% of the national gross domestic product (GDP) despite being home to 3.6% of the population.
Real GDP in the region increased by 1.6% annually on average over the past 10 years, compared to the national average of 2.2%. Northland had an unemployment rate two percentage points above the national rate.
Some 20% of young people were not in education, employment or training, which was twice the national rate.
Median household income, at $46,900, was $18,000 below the national median.
