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“The
most difficult of the last 30 years” is how Chris Trengrove describes
2008 in New Zealand Pork’s recently released Annual Report. “Biofuels,
a commodity boom, drought, losses, exits, grain prices, and recession
all combined to make what many commentators have described as the
perfect storm,” says Trengrove.
During
the year grain prices reached crippling levels, meaning for a period
that producers were losing up to $50 per pig and resultantly exits
began. However by the end of the year, the schedule was pushing
$4.00/kg, the exchange rate had become favourable, pork imports had
dropped significantly and spot grain prices had stabilised allowing
producers to now make modest margins.
Trengrove
notes that the downturn has had an impact with 10% plus production
capacity leaving the industry and therefore expects production to be
down for the 2008/09 year.
Despite
the difficult year Trengrove points to a number of successes for the
industry. The launch of the Lesnies 100% New Zealand Bacon of the Year
Competition drew 110 bacon makers and 233 individual bacon entries.
“Strong consumer interest reinforced country of origin as an important
issue and it is satisfying that all of our major processors have
dedicated NZ hams and bacons and they carry our 100% New Zealand bacon
and ham labelling”.
Consumption
of fresh pork has also continued to grow notes Trengrove. “Growth in
fresh consumption has been half a kilo per capita per year for the last
five years, 75% of our domestic production now goes to the fresh
market. There is no doubt that we can continue to grow consumption but
the challenge is to ensure that we lift returns to producers.”
