MP: Quite a few things.
Trade negotiations, particularly the New Zealand-UK Free Trade Agreement (FTA), have been the fastest progressed trade negotiations in New Zealand history to get to Agreement in Principle – so I’ve been told. Much of this negotiation has been done virtually, also a first. This will change the way trade negotiations occur in the future. A lot less travel overall.
Direct and indirect farm subsidies in large economies, such as the USA, have increased exponentially. People may argue they have already exceeded agreed WTO thresholds.
There’s a growing distrust of governments in the democratic world. Governments need to work on their social licence to operate. Social licence is not just a thing for food producers.
Supply chain vulnerability.
Just In Time (JIT) delivery has been exposed for its supply chain vulnerability in this global pandemic. Economies and businesses will now be building more capacity in their value chain system. This will mean a more conservative approach to exports and imports, to withstand the volatility, uncertainty, complexity, and ambiguity (VUCA) in the world of trade, market access and freight.
Nevertheless, nothing beats high trust and long-term government to government, business to business, and people to people relationships across the world. New Zealand has optimised these relationships throughout the pandemic to utilise market diversity for navigating trade, market, and supply chain disruption.
For example, Covid19 related trade agreements to secure medical imports and food exports. As well as digital certification for export products, through to relationships that our major exporters have with freight companies, importers, and international customers. The last 18 months haven’t been easy, but these strong relationships, and diversity of markets, have shown their worth to New Zealand.
Economies are moving from thinking about food security, to actively putting mechanisms in place to secure their food supply in a pandemic disrupted system, e.g., green lanes in Europe. There’s also a slow nuanced shift from food security to nutritional security taking place.
Farmers and food producers in New Zealand and around the world are wrestling with the multi-layered challenges of regulatory pressure (particularly on the environmental and climate change fronts), as well as market volatility, and Covid 19 induced uncertainty. This is increasing farm input costs and diminishing the tools available for farmers to use to produce food.
As an example, farmers in Europe have real fears about their ability to produce the volume of food required to stay viable and maintain food security. The new farm to fork strategy in the EU is deliberately shifting organic food production up to 25%, with rules to reduce synthetic fertiliser by 50%. Glyphosate use is under threat too. In some places farmers can’t use it (I note in New Zealand, the EPA is currently undertaking a review of Glyphosate use). There’s major transformational change happening in Europe.
The rush of multi-layered change gives a sense of exponential pressure. Farmers all over the world are feeling exasperated, frustrated, misunderstood and under siege. All the same, if there is anywhere in the world I would rather be farming right now, it is here in New Zealand.
We’ve navigated major challenges in the past, and when farmers look at the change they’ve implemented on their farms over the course of their careers, or in the intergenerational businesses they are running, we can take confidence in the fact we are already change agents.
A uniquely positioned New Zealand.
From a New Zealand food producer’s perspective, farmers here are uniquely positioned. Without subsidies, we aren’t dancing to someone else’s tune in quite the same ways as farmers receiving subsidies elsewhere. There are two sides to this. On one hand we’re not being bailed out at the next threat, but we also get to take full responsibility to master the destiny of our businesses. So, we have an ability to create workable solutions in a way that keeps our businesses competitive globally.
With an innovative, integrated systems approach, we can create solutions to challenges like reducing our global warming impact, improving native biodiversity and water quality, while producing high quality, safe, nutritious food – delivered with integrity.
In New Zealand we have an industry ecosystem focussed on helping farmers create and implement solutions. Our research centres and academic institutions, both provide science and knowledge, and help support farmers crack real challenges. There are the easily accessible service providers, and the folk in Government ministries – who are in the teams working hard on trade negotiation to ensure the best possible outcomes for access to markets, and on removal of tariffs and non-tariff barriers to create a level playing field for New Zealand. Let’s keep it that way.
This ecosystem enabling success is our major competitive advantage in the world. We’ve really got to leverage this and remember we’re all on the same team.
We must not be paralysed by fear, but instead celebrate what we’ve already achieved throughout our farming careers and take confidence that we can use our whole systems thinking to improve what we do for our natural resources, our people, businesses, and our nation.