Brief Bites, 3rd July

By Alliance Group04 Jul 2022

In this edition:

Southland Woolshed Meetings
Investing in the future of wool
Alliance Farmers Produce shines in Italy
Research confirms red meat nutritional advantage over plant-based alternative
Know Your Numbers Workshops
Global market update

Southland Woolshed Meetings

Pictured from left: Alliance Global Sales Manager John Rabbitt and Chief Executive David Surveyor.

My team and I greatly appreciated the opportunity to meet face-to-face with more than 200 of our loyal shareholders in Southland over the last fortnight.

Thank you to those who opened their woolsheds and farms to us and to everyone who attended for the spirited engagement and feedback. Across five meetings, we discussed a range of topics including:

Performance over the last 12 months
Premium programme growth and future opportunities
Global markets
How we are addressing labour shortages and building for the future
Sustainability and He Waka Eke Noa
Plans for the future.

The mood in the sheds was certainly optimistic and feedback from all sessions was positive with shareholders particularly liking the opportunity to hear from new and different people and see neighbours and friends again. It was great to catch up and chat more informally while enjoying Handpicked 55-day aged beef, Pure South Lamb and Farmers Kitchen Venison and Lamb pies following the meetings.

We will be visiting woolsheds in other regions over the next few months – look out for details in Brief Bites and through your livestock representatives. We will also be around the country for our Annual Roadshow meetings in September/October.

Investing in the future of wool

One of the topics that came up several times at the Woolshed Meetings was how we extract more value from wool. In line with this, I’m pleased to announce that we are investing in Wool Impact, a collaboration between the Government and sheep sector partners under the Sustainable Food and Fibre Futures fund to grow export revenues for wool.

Wool Impact’s purpose is to facilitate innovation and investment, support demand growth, boost sector services, and enable a unified voice for strong wool in New Zealand. Its formation is based on the 2021 recommendations of the Strong Wool Action Group (SWAG).

Alliance Farmers Produce shines in Italy

Our Pure South and Lumina products were showcased at a premium New Zealand food, wine and spirits event organised by New Zealand Trade and Enterprise (NZTE) at the AcquaRoof Terrazza in Rome this week.

The menu was prepared by the incredible Michelin-star chef Daniele Lippi and included a roast Lumina lamb rack with Manuka honey, a golden fried Lumina lamb cutlet, a Pure South venison cured Prosciutto and a Pure South venison tartare.

The guestlist of 70 included chefs and sommeliers from some of Italy's finest restaurants and hotels, including Gucci Osteria Da Massimo Bottura (1 star), Il Pagliaccio (2 stars), and Sant’Elisabetta (2 stars).

Research confirms red meat nutritional advantage over plant-based alternative

Results from ground-breaking New Zealand research have shown red meat is a better source of protein than a processed plant-based alternative.

The Pasture Raised Advantage project is exploring the health and wellbeing benefits of eating pasture-raised beef and lamb as part of a balanced diet, compared to grain-finished beef or a plant-based alternative.

The research, funded by Meat Industry Association of New Zealand Innovation Ltd, Beef + Lamb New Zealand, the High-Value Nutrition National Science Challenge, and the Ministry of Business, Innovation and Employment, is a collaboration between researchers at AgResearch, the University of Auckland, Massey University and the Riddet Institute.

In clinical trials, thirty participants aged 20-34 years were fed breakfast on four different days and their blood, digestive symptoms and mood were monitored for four hours immediately following the meal.

Breakfast was a burrito that contained a single serving of a different protein each day; pasture-raised beef, grain-finished beef, lamb and a plant-based alternative - served in random order to each participant across the four days.

Researchers measured the nutrients in the blood of the participants and saw a significant difference in the type and amounts of amino acids that come from the digestion of the protein of red meat compared to the protein of the processed meat alternative. Amino acids from red meat were of greater biological value and better absorbed by the body.

A second clinical trial is looking at the longer-term impacts of eating a diet that includes moderate amounts of red meat.

You can read more about the Pasture Raised Advantage research programme at: www.mia.co.nz/nutrition/research/the-pasture-raised-advantage-nutrition-study/

Know Your Numbers Workshops

As part of He Waka Eke Noa, all farmers will be required to know their greenhouse gas (GHG) number by the end of 2022. This is in preparation for agriculture emissions being priced by 2025. Beef + Lamb New Zealand is running a series of workshops.

To find a workshop in your area, please visit the B+LNZ events page.

Update from our global markets

Lamb

Inflationary pressures are creating disquiet in our global markets with the European Union, the UK and North America beginning to trade down to lower value proteins. China remains pivotal to the stability of world protein pricing. Recent COVID-19 lockdowns has seen inventory build, which is creating some uncertainty. We expect the market to stabilise in the last quarter as seasonal consumption and the build for Chinese New Year begins. Overall protein demand remains firm but prices reflect present market uncertainty. The global supply chain remains an issue.

Mutton

Global mutton markets continue to ease, led by a COVID-19-related drop in consumption in China. With low production and a diversified market approach into Asia, EU and North America, we are continuing to move and clear inventory.

Venison

Frozen key account business has been completed for 2022 with the majority of product sold and en-route to our markets. Game season negotiations are continuing and will be finalised by the end of this month. Demand is firm and prices will be an improvement on last year’s levels. Global supply chain performance remains critical for the timely delivery of chilled venison for the pivotal Game season. Ongoing diversification into China and North America will not only support the market but provide viable options away from the traditional EU markets.

Beef

We have strong forward sales across beef cuts, bones and offal in China. However, wholesale market pricing has moved downwards in the last few weeks, which has created some unease with customers. The lockdowns have created uncertainty and we expect this situation to continue as the Chinese government maintains its strict COVID-19 policy. The US market remains sluggish, with prices relatively stable, albeit off the peak levels 3-4 months ago. The domestic processing volumes remain at a high level and this is expected to slowly reduce towards the end of the year. Brazil continues to supply significant volumes into the USA. NZ and Australia are supplying limited volumes at premiums over the South American suppliers (NZ@35% and Australia@15% of annual quota. The Asian market remains firm across beef cuts and lean/fatty trimmings. We continue to sell lean and fatty trimmings at strong values into both Korea and Japan.

Co-products/Specialty Ingredients & Materials

Specialty ingredients & materials categories are proving resilient to the fuel crisis inflation so far, however this is likely a lag effect. The exception to this is hides and China has lost more business to other leather producing markets and synthetic alternatives. Tallow pricing remains strong as NZ production tapers off. Demand for meal and offal suitable for pet food ingredients also remains high as all trends in pet point to growth.