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The Muster: Mark Patterson: Red Meat Sector Conference · The Muster on Hokonui

• 0:01
  Speaker 1: This is my heartbeat song and I'm.
• 0:03
  Speaker 2: Gonna play it.
• 0:05
  Speaker 1: Been so long I forgot how to turn it up, up, up,
• 0:09
  Speaker 1: up all night long. Oh, up, up all night long.
• 0:16
  Speaker 2: You.
• 0:18
  Speaker 1: Mark Patterson joins us this afternoon from the Red Meat
• 0:22
  Speaker 1: Sector Conference, which is up in Wellington, of course. He's
• 0:24
  Speaker 1: a Minister for Rural Communities, Associate Minister of Agriculture, as
• 0:28
  Speaker 1: well as Regional Development. Good afternoon, Mark. The song's called
• 0:31
  Speaker 1: The Heartbeat Song. What's the heartbeat of the red meat
• 0:34
  Speaker 1: industry up there?
• 0:36
  Speaker 2: Oh, look, the heartbeat's strong in the red meat sector
• 0:38
  Speaker 2: at the moment. Andy, probably, well, it's the strongest I've
• 0:41
  Speaker 2: ever seen it in my 35, nearly 40 careers being involved. So, yeah,
• 0:47
  Speaker 2: couldn't be anything other than positive this year.
• 0:50
  Speaker 1: Is that just regarding the pricing that we're seeing at
• 0:52
  Speaker 1: the moment? I mean, the scheduling of the $ 12 mark?
• 0:56
  Speaker 2: Yeah, you know, obviously the caveats around, you know, the
• 1:00
  Speaker 2: weather conditions in Southland, South Otago primarily. But, yeah, from
• 1:06
  Speaker 2: a market perspective, not just from a market perspective, I
• 1:09
  Speaker 2: think also some of the the innovation that's going on
• 1:13
  Speaker 2: and we're seeing the adoption of collars on hill country
• 1:17
  Speaker 2: farms for cattle and it just seems like the stars
• 1:21
  Speaker 2: are aligned in terms of that combination of pricing, innovation
• 1:27
  Speaker 2: and productivity gains that are on offer. We just need
• 1:30
  Speaker 2: the weather to play the part now, Andy, don't we?
• 1:33
  Speaker 1: So you talk about the mood of the sector being
• 1:35
  Speaker 1: good up there. What are you seeing at this event
• 1:37
  Speaker 1: that is really driving that sentiment?
• 1:41
  Speaker 2: Just the demand. We've got some international speakers there, particularly
• 1:45
  Speaker 2: from the States, just talking about, you know, the demand
• 1:49
  Speaker 2: for protein that's coming through and some of the trends
• 1:51
  Speaker 2: over there that are hugely positive for our red meat sector. And,
• 1:58
  Speaker 2: of course, that's a very high-paying market. So, you know,
• 2:00
  Speaker 2: that's a snapshot of what we're hearing. But, as you say,
• 2:04
  Speaker 2: you know, a $ 12 market, lamb schedule talking to one
• 2:08
  Speaker 2: senior meat industry official saying that he can't see the
• 2:13
  Speaker 2: price going below about $ 10. 50 this year so you know
• 2:18
  Speaker 2: that's in the peak of the season so that you
• 2:21
  Speaker 2: know that's really confident way to go into into this
• 2:25
  Speaker 2: particular season fantastic to stack another season on top of last.
• 2:29
  Speaker 1: Season so is that for lamb $ 10. 50 is that correct.
• 2:33
  Speaker 2: Lamb 1050, yeah, so that's where he thinks the bottom sits,
• 2:37
  Speaker 2: and this is a very senior meat company official. I'd
• 2:40
  Speaker 2: better not quote him and just leave him unattributed, but yeah,
• 2:45
  Speaker 2: so they're very, very positive about the state of this sector.
• 2:51
  Speaker 2: You know, we just need it to dry up a
• 2:52
  Speaker 2: little bit so we can fill our boots.
• 2:55
  Speaker 1: The US market's an interesting one too. Given that President
• 2:58
  Speaker 1: Trump is letting a lot of terror-free beef into the US,
• 3:02
  Speaker 1: does that affect New Zealand much?
• 3:05
  Speaker 2: Potentially, yes. But there's a global shortage of protein, so
• 3:12
  Speaker 2: I guess it opens up opportunities elsewhere as well. So
• 3:17
  Speaker 2: the supply and demand factors are very much in our
• 3:20
  Speaker 2: favour seemingly, so that's great news.
• 3:23
  Speaker 1: Now, given the geopolitical situations around the world, Mark, is
• 3:27
  Speaker 1: it still a lot of buoyancy in the economic space
• 3:31
  Speaker 1: for New Zealand lamb?
• 3:34
  Speaker 2: Yeah, I think so. I mean, we're a relatively small
• 3:36
  Speaker 2: part of the protein section, certainly compared to beef or
• 3:41
  Speaker 2: chicken or pork. So we're very much niche. So while
• 3:45
  Speaker 2: we're getting swept along by the wider protein story, lamb
• 3:51
  Speaker 2: has got a unique place in that. So you know,
• 3:54
  Speaker 2: the people in the sector that know it far better
• 3:57
  Speaker 2: than I do in terms of the cult face of
• 3:59
  Speaker 2: the market. So, you know, nothing but positive at the moment.
• 4:02
  Speaker 1: You talk about wool. We'll mention this because, you know,
• 4:06
  Speaker 1: your party's not a fan of this India Free Trade Agreement,
• 4:08
  Speaker 1: but you were over there not long after that announcement
• 4:11
  Speaker 1: on behalf of wool growers as such. What was the
• 4:13
  Speaker 1: mood over there regarding the fibre?
• 4:15
  Speaker 2: Yeah, well, very positive. I mean, the importers of New
• 4:19
  Speaker 2: Zealand wool, I mean, the free trade deal... You know,
• 4:24
  Speaker 2: there's 2.75% tariff coming off wool, so the auction goes
• 4:29
  Speaker 2: up and down by that every week, so it's around
• 4:30
  Speaker 2: the margin. The real opportunity over there is they're looking
• 4:33
  Speaker 2: at tripling the size of an already huge textile industry,
• 4:37
  Speaker 2: so New Zealand Wool's got some real opportunities there. And,
• 4:42
  Speaker 2: you know, we're really the only place in terms of
• 4:44
  Speaker 2: those strong white wools that they can get the volume
• 4:47
  Speaker 2: and quality that we provide. So, you know, there again,
• 4:50
  Speaker 2: we're in a good position.
• 4:52
  Speaker 1: So it's fair to say this free trade agreement's going
• 4:55
  Speaker 1: to work in New Zealand's favour, more so than not?
• 4:57
  Speaker 2: Well, you know, dairy's not in, beef will never be in,
• 5:02
  Speaker 2: of course. So there is some advantage for lamb, but
• 5:07
  Speaker 2: coming off a very, very low base, horticulture potentially. But
• 5:11
  Speaker 2: there's a few things that you've got to look at
• 5:13
  Speaker 2: both sides of the ledger, Andy, where there's uncapped student
• 5:18
  Speaker 2: numbers that we can get coming in here with work rights,
• 5:21
  Speaker 2: so that's going to end badly. We've got plant variety rights,
• 5:24
  Speaker 2: which is very, very weak protections over there for the
• 5:28
  Speaker 2: likes of our G3 kiwifruit or MV apples. And, of course,
• 5:31
  Speaker 2: we've got this extraordinary, preposterous figure of $ 35 billion New
• 5:36
  Speaker 2: Zealand dollars that we're expected to invest in the Indian economy,
• 5:40
  Speaker 2: which is... You know, New Zealand First was never going
• 5:43
  Speaker 2: to sign up to that rule for the free trade
• 5:45
  Speaker 2: part of it, but these other aspects are... You know,
• 5:50
  Speaker 2: we just... We just couldn't get close to agreeing to that.
• 5:54
  Speaker 2: I mean, they deserve more scrutiny. We gave it to them,
• 5:57
  Speaker 2: Labour folded, and I guess National wanted to get it
• 6:01
  Speaker 2: over the line for political purposes before the election.
• 6:04
  Speaker 1: But a market of 1.3 billion people can't be ignored
• 6:07
  Speaker 1: at the same time.
• 6:08
  Speaker 2: No, and it's in our coalition agreement with National to
• 6:11
  Speaker 2: progress a free trade agreement, a free trade agreement, not
• 6:14
  Speaker 2: an open immigration agreement. outward investment and, you know, gifting
• 6:19
  Speaker 2: of plant variety rights agreement, which is what we've ended
• 6:22
  Speaker 2: up with. Unfortunately, it would have been better to take
• 6:24
  Speaker 2: a little bit more time and not trade away so
• 6:28
  Speaker 2: much to get what is essentially a headline. Yes, there'll
• 6:33
  Speaker 2: be some benefits for lamb, although, you know, I think
• 6:37
  Speaker 2: we send about 60 tonnes in there. Last year, the
• 6:40
  Speaker 2: Aussies have got quite a free access and they send
• 6:44
  Speaker 2: very little in there because, you know, Markets like the
• 6:47
  Speaker 2: US and China just pay far more. So it's not a,
• 6:51
  Speaker 2: you know, you've got to see some perspective and some
• 6:54
  Speaker 2: context of what we're actually getting out of this in
• 6:56
  Speaker 2: the short term, which is not actually very much.
• 6:59
  Speaker 1: Just finally, the entertainment last night on stage was a
• 7:02
  Speaker 1: boning demonstration of a lamb carcass. That's not something you
• 7:05
  Speaker 1: see every day in Wellington.
• 7:06
  Speaker 2: No, no. And, you know, fair play to Nathan Guy
• 7:11
  Speaker 2: and the Meat Industry Association. It was actually really interesting.
• 7:16
  Speaker 2: I mean, we've all seen and boned out carcasses, and
• 7:20
  Speaker 2: I know we're as good as Rua, who was doing
• 7:24
  Speaker 2: it for us, but actually just talking through where each
• 7:27
  Speaker 2: cart was going, what they're doing for each individual market,
• 7:31
  Speaker 2: and there's a lot of moving parts to the red
• 7:35
  Speaker 2: meat sector, a lot of different horses for courses in
• 7:38
  Speaker 2: terms of different carts for different markets and how they
• 7:41
  Speaker 2: did it. So it was actually really... engaging and informative
• 7:46
  Speaker 2: and better than just the usual kind of get together.
• 7:53
  Speaker 2: It gave it a little bit of colour and purpose
• 7:56
  Speaker 2: and well done to the Meat Industry Association.
• 7:58
  Speaker 1: Yeah, it's a bit different to karaoke, Mark Patterson. Thanks
• 8:01
  Speaker 1: for your time as always.
• 8:03
  Speaker 2: Thanks, Andy.
• 8:06
  Speaker 1: Mark Patterson up at the Red Meat Sector Conference in Wellington.
• 8:09
  Speaker 1: You're listening to The Muster from Wellington to Closeburn Station.
• 8:13
  Speaker 1: Grant McMaster's up next.