Friday, March 29, 2024

PULPIT: We have no plan for the future

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New Zealand’s primary industries are not prepared for the rise of synthetic food and alternative proteins.
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I recently attended the ProteinTech conference in Auckland and was extremely underwhelmed – not by the conference but by the state of our industry in the presence of looming, complete disruption.

Synthetic foods and alternative proteins have the potential to eliminate our country’s largest industry, cut our export earnings and collapse our economy. 

Yet, despite the potential size of this challenge, there is complete disconnect between many of the leading primary industries organisations. We are very far away from developing a clear strategy.

When will these technologies become a real competitor? 

What will the competition actually look like? 

What will future market segments look like? 

What strategies will we implement to cope with this new and unprecedented competition? 

It appears the answer to all of these questions is: We really don’t know.

That just isn’t good enough.

Perhaps some of our problem-solvers and thought leaders don’t want to play their cards too early but is that just being hopeful? Even if there are conversations occurring behind closed doors, is that really enough? 

An obvious and common example of learning from the past is NZ’s wool sector and its transition from one of the most significant income-earners to what is now essentially a system cost with only a few niche winners remaining. 

There are very useful lessons to be learnt from that collapse caused by synthetic competition. 

But what must also be understood is the different global and competitive landscape we now operate in. Competitor investment is higher, technology has increased, the world is more globalised and the pace of change is guaranteed to be exponentially faster. That means our co-ordinated and strategic approach must be a lot faster too.

With synthetic foods and alternative proteins now having commercialised products, significant investment and following multiple consumer trends I expect our entire industry would have an established, widely understood path to guide success into the future. We don’t.

Transparency is a word used often in our industry, a focus for messaging and usually in the form of pasture-to-plate or something similar. But if we knocked on a farmer’s door and asked where the NZ industry is heading, what are the next steps and what’s your role in that change – how many would be able to answer? Very few. 

Yes, supply-chain transparency is valuable but true connectedness and alignment from pasture to plate is what will be required for our industry to succeed.

The conversation of our primary industries needs to mature very quickly from disconnected and underwhelming to a collaborative, confident and clear direction.

So what needs to happen?

Starting with the obvious is developing our industry structure. There must be a clear alignment of NZ’s stance across all industry players – alignment not just within certain sectors but from farmers to marketers to growers to industry bodies to processors to technologists to government. 

An appropriately structured industry alignment can enable clear and consistent messaging to international markets for all products and services from NZ while maintaining the opportunity for agility and niche operations by individual sectors or companies. 

Once that is established we can move to the real conversation, deciding what our primary production landscape should look like. 

I believe we should not be choosing between either high-value, conventional production or high-tech, modern production. We should be a world leader in both.

NZ’s pasture based, free-range, non-genetically modified, antibiotic-free, high safety and quality products can and do lead the world. Selecting this as our industry strategy is the easy option. It requires little change and shifts all pressure to those marketing our products to do so in the best way. 

But what happens if the next generation of consumers demands any animal death related to food production is unjustifiable? 

What if Ireland, Sweden, Canada or other competitors with similar offerings outcompete us? 

And what if a single mistake is made that tarnishes the reputation relied on in this strategy? The risks are clear.

NZ also has some of the world’s leading scientists and innovators. There is substantial opportunity to be a global-leader in specialised niches using synthetic technologies. That is particularly appealing with integration of NZ’s completely unique flora and fauna, which provide a valuable and protectable genetic basis to leverage for future synthetic foods or alternative proteins.

But what if consumers decide they will not buy any food that is processed, genetically modified or produced in a laboratory? What if we can’t compete with the overseas investment in alternative production or don’t properly communicate our value proposition? Again, the risks are clear.

Therefore, NZ should not spend the next decade arguing between conventional or modern food production or traditional production verus genetic modification. We should acknowledge limiting our opportunities is much more damaging than liberalising our science. 

We should ignite the potential for these opportunities to be recognised now while we can still be early adopters and before we are left too far behind.

And enabling the two broad production methods, both traditional and modern techniques, actually opens a third and perhaps even more exciting opportunity in which NZ could be a world leader.

Traditionally-produced meat and milk have nutritional composition that cannot be competed against, even by top-technology synthetic food in the short and medium-term. The efficiency of synthetic food production offers opportunity to benefit the environment, animal welfare and global food shortages. 

When the products of these two production mechanisms are combined they can enhance each other – maximum nutrition products combined with increased-efficiency foods.

This combination of value can be recognised together with the relatively new science evolving in the space of nutrient synergies.

Combining certain products and preparing them in specific ways can greatly increase the bioavailability of nutrition to the human body. These nutrient synergies aren’t marketed and consumers haven’t been educated. There is a clear opportunity for NZ to be a global leader and use this as a point of difference.

The result of all of this is three separate but integrated opportunities for our industry.

Traditional high-value food options for those consumers who don’t like change and won’t eat synthetic foods.

Commodity-based, high-volume production of synthetic food or alternative proteins to target the consumers who seek efficiently produced or more vegan-based foods. 

And foods that cross both categories based on nutrient synergies, for the educated consumers who align themselves with the latest science and nutrition.

The wheel of progress is turning but very, very slowly. 

We need to fully collaborate and ensure our industry’s limited resources and capital can be pooled rather than trying to create and argue about individual solutions. 

We need to set a clear direction and message for ourselves and our international markets that promotes value, agility and innovation.

We need to act now, developing and beginning to implement strategies that will allow us to continue to showcase NZ as the world’s leader in top-quality, high-value and efficient food production.

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