Open Letter re Meat Industry

Subject: Open Letter re Meat Industry
From: John Gregan,
Date: 21 May 2015

Dear Sir,

New Zealand sheep farmers have seen their share of the retail price of New Zealand lamb in Europe shrink from 80% 40 years ago 45% in 2001 to less than 20% currently. Compare sheepmeats to the poultry industry where chicken producers get nearer 50% of the retail price of their product.

75% of the world across border sheepmeats trade is New Zealand grown yet due to the highly fragmented structure of New Zealand’s industry we are failing to take advantage of this position. In fact it is the supermarkets, who have themselves consolidated into a few, powerful buyers, that are taking advantage.

We now have a chance to finally cooperate as farmers and form a company owned by farmers that can make the most of our strong position. We beg our cooperatives and especially their farmer directors farmers to shake off the demons of the past and to take this opportunity.

Perhaps Alliance should have moved earlier to merge with PPCS. Likely Alliance would have been wise to include PPCS in designing the consolidation plan. Nevertheless the wrongs of the past can not be righted now. The only really important fact before us is that Owen Poole has put together a strong plan for unifying at least the sheepmeats sector of the NZ meat industry. Marketing of Venison and Beef would also be strengthened by the Poole plan but we accept that not all private sector beef assets will join the new cooperative.

The farmers named at the foot of this letter strongly support Mr. Poole in negotiating the best deal that he can on our behalf, even if this does not capture all beef assets. We urge the directors of PPCS to also support him.

The current concept isn’t about existing companies, it is about creating a structure where the farmer and our company and its employees are fairly rewarded for their endeavour. All the power is in the farmers hands. We ultimately own these cooperatives and we decide where we will send our lamb.

We urge our fellow farmers to contact their cooperative directors and to ask them to support Owen Poole’s plan.

Yours truly,

John Gregan,
Keith Milne,
Forbes Elworthy,
John Rolleston,
Murray Rohloff
Joanne Marshall-Crack