Satisfying the demand of high-value customers

The AgriBusiness Group consultants have adapted the knowledge gained from fifteen years of research into developing a sustainability assessment tool that assists producers to demonstrate their system operates sustainably and so meets the provenance requirements of our high-value customers.

NZIPIM annual conference 2019, Christchurch

I recently attended the first day of the excellent New Zealand Institute of Primary Industry Management’s annual conference in Christchurch. As an aside, I note with pleasure that this was by far the biggest conference in the 50 years that it has been going which says to me that the Institute is in excellent health.  

As is normal, the first half-day session was devoted to an update of the prospects for our core exporting industries. These presentations ranged from the big conglomerate commodity processors and marketers to the producers and marketers of bespoke products directly to the end-users. What struck me was the incredible difference in the tenor of their presentations. 

Large commodity marketers seemed to lack drive and a long-term vision. At present, they are comfortably happy to pass on average value to their suppliers. In contrast, smaller bespoke producers passionately talked about their bold achievements and high ambitions to deliver the absolute maximum return to the supplier. 

The key fundamental distinction between these approaches was whether or not marketers are aspiring to meet the requirements of the discerning high-value purchaser, who is concerned with the origin of the product they wish to buy. In my opinion, the critical aspect of product origin is that it portrays the quality and the very high standard of animal welfare. It also demonstrates that the production system aims to minimise detrimental effects on the environment and the surrounding ecosystems.

The AgriBusiness Group has been involved in researching the topic of sustainability for the last fifteen years - firstly through leading the Agricultural Research Group on Sustainability and then facilitating the research into the Sustainability Dashboard. All of that knowledge development has resulted in new sustainable practices that have been successfully adopted by the Wine and the Kiwifruit industry. Both are industries which are very keen to maximise the value by marketing the origin of their products to discerning customers.

The latest development from that research is the design of a comprehensive sustainability assessment tool that can be used across the pastoral and arable/vegetable production industries. The AgriBusiness Group’s consultants can carry out this assessment for an individual producer or a group of producers and support them in reaching their goal of declaring their production system sustainable. Then farmers and growers can satisfy the demand of the high-value consumer by proving that their product is produced in a sustainable production system and reap the extra rewards of entering that high-value market.

On the current performance of our primary industries, we at The AgriBusiness Group firmly believe that proving the environmental and social performance of the production system is the only viable way forward in the long term. Sustainability credentials allow producers to achieve higher value returns from these highly discerning markets as opposed to the average profits that can be obtained from commodity markets.

Author: Stuart Ford