There is nothing like an election to bring out the real issues for discussion and experienced farmer politcian Jeff Grant, renewed calls for action on the formation of a strong wool marketing company driven by the two meat Co-Ops,as he campaigns for a seat on the Alliance board.
He quite rightly reminds farmers that the present strong position of the sheep sector was due primarily to supply and demand, not marketing efforts or industry rationalisation. He encourages all farmers to keep driving changes in these areas as the present profitable situation gives the industry time to get it right for the future.
The antagonism that was evident between both companies when these issues were last raised seems to have passed, and it is hoped both parties will take an industry perspective to ensure there is a rosy future for the meat sector. Both companies expressed the view that the wool sector needed to pull its weight when sheep profits were poor, so now could be the time to "put their money where their mouth is".
Do you agree with Jeff Grant on his call for the meat Co-Ops to drive change in strong wool marketing and meat industry amalgamation? Your views?
Former Meat and Wool NZ and NZ Meat Board chairman Jeff Grant believes meat companies Alliance Group and Silver Fern Farms should jointly establish a wool marketing entity. Mr Grant, who is standing for the board of Alliance, said the meat industry must stop "dancing on a pinhead" and get serious about protecting the future of sheep, beef and deer farmers reports The ODT.
The consumer market was providing a window of opportunity, with current returns above the long-term average. That was due to supply and demand, rather than marketing efforts, and the industry needed to take the opportunity to consolidate and form marketing alliances, he said in a statement. "Amalgamation doesn't need to happen tomorrow, but we need to see a commitment from both co-op's that they are prepared to work towards such a position.
As dairy land increased, beef and sheep land decreased, putting pressure on the red meat industry to survive with a diminishing volume of product to market. Meat co-operatives should consider all business opportunities that could increase shareholder returns. He believed they needed to look at the future of strong wool marketing and establish a wool marketing entity.
"Anything would be better than the shambles of the past 25 years. Farmers are desperate to see change." The co-operatives were well resourced to take a lead, especially when they were already large players in slipe wool. A joint venture for wool between Alliance Group and Silver Fern Farms would be no different than the NZ Lamb Company, which both co-operatives used to sell sheep meat into North America, he said. The volume of wool produced by the two co-operatives' shareholders, combined with slipe, would make such an entity the largest strong wool marketing company in the world, he said.
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