Column by Fiona Acheson, Head of Food, Beverage and Consumer Goods at New Zealand Trade & Enterprise.
We all know how disruptive the COVID-19 pandemic has been to our lives and New Zealand’s economy. Tourism and international education, in particular, have taken a massive hit.
Yet New Zealand’s food and beverage sector has been the stand-out for filling part of the gap.
The dairy sector, for example, earned a record $22 billion for the year ended June 2022 and is expected to earn an additional billion dollars during the current financial year.
Wine has been another to significantly increase its value. Exports for the 12 months to September were at an all-time high of $2.03 billion, up six percent from the previous year. In particular, the US ($727 million) and Canada ($157 million) were at new record levels.
Overall, the Ministry for Primary Industries found that export earnings from the primary sector were $53 billion in that June 2022 year, an 11 percent rise on the previous year.
Sitting within this, meat and wool exports earned $12.3 billion, horticulture $6.7 billion, and seafood $1.9 billion.
At NZTE we work closely with around 400 F&B exporters, and we are regularly inspired by their dedication and determination to share New Zealand’s great produce with the world.
We’ve had significant growth into Australia and North America, which is why we have recruited more business development managers in those markets to support our exporters.
New Zealand is blessed with good growing conditions for premium food and beverage, but what increasingly stands out is how many exporters are using innovation to develop new products and grow their businesses.
We know that first hand, because the Supreme winner of our New Zealand International Business Awards in November was Rockit Global, the creators of the snack-size apple.
Last year Silver Fern Farms took advantage of the Prime Minister’s business mission to the US to launch New Zealand's first certified, grass-fed, net carbon-zero red meat – a significant innovation in our premium meat exports.
CEO of Silver Fern Farms, Simon Limmer and New Zealand Prime Minister Jacinda Ardern attend the US launch of Silver Fern Farms' Net Carbon Zero by nature 100% grass-fed angus beef at New York's Klimpton Eventi Hotel on May 24, 2022 in New York City. (Photo by Dave Kotinsky/Patrick McMullan via Getty Images)
And we’ve been working closely with NZ Beef & Lamb in Shanghai for their trial of ready-to-eat meal boxes available from vending machines. Chinese consumers were really excited by the option of buying grass-fed lamb leg with apple and herbed potatoes or grass-fed beef sirloin with sweet ginger noodles.
NZ Beef + Lamb vending machines in China
The trial saw more units sold than projected and has provided valuable lessons for the team as they develop this concept.
And if you ever visit Tokyo, don’t miss the opportunity to drop into the Cookie Time café there. You can try flavours you’ll never find at their original shop outside Christchurch!
We are also capturing value from a wider range of primary products – take Ārepa, a company that has developed a range of blackcurrant drinks that provide brain nutrition, or Sustainable Foods Ltd, whose delicious plant-based protein products use hemp as a key ingredient. We also have a growing oat milk industry, making use of protein-rich Southland oats.
So, what do we think will happen in 2023? As soon as borders started to reopen, NZTE’s international teams noticed an immediate increase in companies travelling to reconnect with their key distributors and channel partners. Many of them were choosing to spend weeks and even a couple of months reconnecting.
We don’t expect this to slow down. So much has changed in the past three years, and seeing the market for yourself is the best way to get a sense of where consumer preferences have moved.
Shifts we’ve noted and seen accelerate in the past few years include the move to online purchasing (including for fresh food); the growth in experiential stores that engage customers, for example, a cooking experience; the move to staff-less, cash-less stores (the Shanghai vending machine is a good example); how vegan has gone mainstream; the exponential growth in zero-percent alcoholic beverages; and the expectation of sustainable packaging.
When you’re overseas, make sure you have time to wander around local supermarkets, cafes and corner stores and soak up these changes – they could provide inspiration for your own innovation.
Supply chain problems will continue – we don’t think the world’s global network will recover from the pandemic for at least another year. This means staying adaptable.
The change of COVID policies in China brings good news for our exporters. First, having simpler access to the market is important, but the testing of cold-chain products for traces of COVID-19 has also ceased, which is a huge relief for those who use this method.
Sustainability – of your product, your packaging, and your supply chain – will become increasingly important, both with the UK-NZ Free-Trade Agreement coming into effect this year and the eventual ratification of our free-trade agreement with the European Union.
NZTE’s research shows that consumers in these markets– those that value and will pay for premium F&B products – are placing sustainability credentials at or near the top of their decision-making. We are also seeing this preference for sustainable and ethical products emerge in the US and Australia.
With a network of more than 400 staff and private-sector advisors based in our key international markets, NZTE has built a wealth of knowledge, resources and tools to support companies exporting.
If you’re just starting to export, or are thinking about it, then please start by signing up for myNZTE. It’s all free, and it’s a goldmine of information about exporting, right from the basic assessment of whether your business is ready to take on the world. There are lots of case studies in there from fellow Kiwi exporters who have the bruises and scars.
Exporting is hard, and I have nothing but admiration for the companies that do it. To see your products being enjoyed by consumers in different parts of the world is also incredibly rewarding
And, at NZTE, we think the world needs plenty of Kiwi goodness.
