New Zealand - a World Leader in Agriculture Science

New Zealand - a World Leader in Agriculture Science Agriculture • the science and practise relating to the interaction between people, plants and an...
Author: Elaine Jones
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New Zealand - a World Leader in Agriculture Science

Agriculture •

the science and practise relating to the interaction between people, plants and animals in the agricultural environment.



the raising of crops and animals to provide food, fibre, shelter and other materials needed by people.

Mount Albert Grammar School, Auckland, New Zealand

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OVERVIEW OF NEW ZEALAND AGRICULTURE Introduction NZ is internationally renowned, both today and historically for success at all levels in the primary industry. These accomplishments include technological innovations, scientific advances, products, processing and marketing. Agriculture is a key economic driver for New Zealand, generating more than half of New Zealand's exports. It is New Zealand's largest industry. Over half of New Zealand's land area is used for farming or plantations. New Zealand's economy has been based on a foundation of exports from its very efficient agricultural system. Leading agricultural exports include meat, dairy products, forest products, fruit and vegetables, fish, and wool. Leading manufacturing sectors are food processing, and wood and paper products. Traditionally farming has centred on sheep and cattle to produce sheepmeat, beef, wool, dairy produce and hides, although in recent years new types of livestock have included deer, goats, ostriches and llamas. Since the 1970s horticultural produce has also become an important export earner. Uniquely, among the developed countries, New Zealand farmers are almost totally exposed to world market forces. They receive no subsidies from government and have to compete with subsidised production from other producing countries. However, the GATT Uruguay Round Agriculture Agreement, which began to take effect in 1995, imposes progressive reductions on the subsidies that other countries can give to agricultural production and exports, increasing access opportunities for New Zealand exports into overseas markets.

Situation in New Zealand Government The New Zealand government now provides no direct support to agriculture. It expects the agriculture industry to make its decisions based on international competitive advantages. Policy changes have taken New Zealand from a highly regulated economy to one of the least regulated economies in the Western World. Government has withdrawn from providing goods and services other than the core services of education, health, law and order and welfare. Previous government trading activities have been commercialised or privatised. Mount Albert Grammar School, Auckland, New Zealand

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Government no longer competes with the private sector in providing goods or services. Government costs have reduced. Government expenditure is now 38% of GDP and government employs 22% of the work force. Government sees its role as providing a stable environment for long term decision making. It no longer tries to pick winners, but instead expects individuals to make investment decisions based on international market prices. Government assists in negotiating government to government access, and providing information to decision makers where this is available. Many responsibilities have been devolved to local authorities or local communities. Inflation is low at 1%, and stable. Interest rates have fallen to record lows, and economic growth is slowly picking up (GDP 2.8% per annum). Unemployment remains stubbornly high at around 10% of the labour force, but job growth is occurring. Lower skilled workers and ethnic minorities are amongst the most disadvantaged. Government has moved to recognise the importance of environmental issues, particularly in marketing agricultural products. Producers are being encouraged to reduce the use of weeds and pests, fertiliser, and to pay particular attention to animal welfare and soil and water degradation problems. The approach is to produce quality products from a quality environment. Economic growth is now occurring and is around 2.8% of GDP. The internal balance of payment deficit continues at 3% of GDP, and the net public overseas deficit is about 50% of GDP. New Zealand still continues to live beyond its means, so further reduction in government expenditure is inevitable. In agriculture, government is involved in producer and marketing board reform to ensure that clear international market signals reach New Zealand producers, and that these important organisations are operating efficiently. Government has required a clear policy/delivery split, and many quality assurance activities are contestable. Government remains vitally concerned with international trade negotiations and access arrangements. Quarantine management and disease response also stays with government. Government expects the agricultural industry to carry the risks of farming, and only provides limited government support for extreme climatic disasters when it is in the national interest to do so. Mount Albert Grammar School, Auckland, New Zealand

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Government is trying to facilitate strategic planning and forward thinking, but recognises that industry and community identification and ownership of opportunities and issues results in the best outcomes. The government recognises that New Zealand is part of an international community, and that our future is highly dependent on freer international trade. These positions are reasonably well accepted by most New Zealanders and the country remains a politically stable democracy, although there is growing dissatisfaction amongst the unemployed and lower paid workers. Government expenditure on welfare programmes is at an all-time high. Crime has increased.

Situation in Industry Whilst initially slower to respond, significant change has occurred. Industry organisations are now extremely client focused on both international and domestic clients. Agricultural lending has become very sophisticated but more conservative. There is much greater agricultural expertise in rural lending institutions. This is encouraging farmers to continue to become even more business oriented. Lenders are again competing aggressively for agricultural lending. The processing sector has also seen major change. With the exception of wool, about 80% of New Zealand agricultural produce now leaves the country in a processed form. Many new technologies have been introduced to improve product quality as required by overseas consumers. Products are exported to a wider range of markets. Recording and reporting procedures are being put in place by processors to provide farmers with information to manage their farms better so that they can produce products to consumer specification. Strategic plans are being developed in each of the sectors. Labour market reforms have allowed increased efficiencies and the introduction of new technologies and reduced processing costs. Even after 10 years, there is still some rationalisation to go. There is, for example, approximately 50% surplus sheep killing capacity in the North Island. This is putting larger, older meat processing plants at risk. Many have closed, and more will eventually close. Increases in forestry in traditional agricultural areas is putting further pressure on processors in these areas as farm output falls when farm land is planted in trees. Mount Albert Grammar School, Auckland, New Zealand

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The servicing sector has also changed considerably. Farmers are using fewer farm inputs and there has been considerable rationalisation in farm input suppliers. Many service organisations have closed smaller rural branches and now concentrate on core business activities only. This has reduced farmer access to some services, particularly in more isolated regions. In most areas, however, farmers receive more efficient service.

The Current Situation on Farms After initially declining, farm profitability, land values and farmer confidence have increased. The prospects for most sectors look promising. There is now considerable emphasis on farm business management. Farmers actively seek international market price information on which to base farming decisions. The relative profitability of enterprises has changed farm production patterns. Sheep production on harder hills in particular is well down on the peaks of 1982/83. Beef production has increased, and has in some areas replaced sheep completely. The overall output of sheep and beef farms is down, but export returns have increased. Farmers are producing better quality products. Fertiliser applications have increased, but not to the previously high levels. Much of the hard hill country developed under subsidies has reverted, or is being planted in forestry. Some of these areas are now prone to land erosion. This is highlighting the folly of trying to maximise farm output on unsuitable land. Implementing more environmentally sustainable land management practices is now a key challenge facing farming in New Zealand. Farmers have diversified as a means of reducing risk and increasing flexibility. New ventures such as forestry and rural tourism have been added to core farm businesses. For most sheep and beef farmers, the future now seems reasonable. However the gap has widened between more successful farmers and less successful farmers. About 20% of farmers now hold approximately 80% of the total farm debt on sheep and beef farms. A proportion of these more highly indebted farms still do not have a long term future in farming. They will probably have to sell up.

Mount Albert Grammar School, Auckland, New Zealand

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However, fewer farmers than predicted left the land during the most difficult times. A high proportion (about 40%) of sheep and beef farms now have off-farm income. Land values have recovered, although not to previous high levels. This has re-stimulated land sales, which now run at an annual turnover of about 8% of farms. While interest rates have fallen, there is still a strong desire to minimise borrowing and repay debt. As user-pays comes into action, the cost of living on more isolated sheep and beef farms has increased. Higher charges for services previously provided by government, but now commercialised, are causing resentment in rural areas. Arable farming has changed significantly. New Zealand now has only around 40% of the barley and wheat producers it once had. Arable farmers produce for the domestic market only. Arable farmers have, however, diversified into other crops, but the industry remains small. Dairy farming has progressed. Dairying is currently the most profitable form of pastoral farming. Cow numbers and production have increased. So, too, have land values which in recent times have been well in excess of the earning capacity of the farms. This has led dairy farmers to move into traditional sheep farming regions. While buying the land is cheaper, the costs of production in marginal areas are higher, and it remains to be seen if this is wise. Dairy farmers are, however, very confident. Orcharding is mixed. Kiwifruit profitability is very low due to international supply exceeding international demand. New Zealand led the world into kiwifruit production, and after high returns in the late 70s and early 80s, most kiwifruit orchards have run at a loss for the last 4-5 years. It is now cheaper to buy land with kiwifruit on it than bare land. Kiwifruit is a good example of what can happen if an industry does not adequately plan for international developments. Apple orchards have been very profitable. The area in apples has been expanded rapidly, and exports increased significantly. However, international prices fell this season due to higher production on European orchards. Apples is another good example of New Zealand producers responding to consumer demands. Many New Zealand apple orchards have been changed from traditional varieties to new premium varieties producing higher returns, despite a 4-5 year lag before orchard output returns. Mount Albert Grammar School, Auckland, New Zealand

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Communities are Strengthening After a severe downturn initially, rural communities are now strengthening. An interesting feature is that many communities are deciding to take ownership of their problems, and the means to fix them, themselves. This is now seen as a key to community and individual change in New Zealand. Landcare groups are a good example of community responses to community issues. Such groups collectively address problems such as land and water degradation, and weed and pest control, on a catchment or regional basis. Other examples of community self-help are Rural Opportunity and Regional Strategy Groups. In this concept, groups actively seek to take advantage of opportunities they identify for themselves. These two approaches are developments on the traditional discussion group approach which had successfully served as an agricultural extension tool in New Zealand farming for many years.

Mount Albert Grammar School, Auckland, New Zealand

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STATISTICS Source: New Zealand Official Yearbook 2000, Statistics New Zealand and Ministry of Agriculture and Forestry. Please note, this information was the most accurate available at time of publishing in June 2004.

GENERAL  Agricultural and forestry products earn more than half of New Zealand's export income. Agriculture has been a major earner in New Zealand's economy for more than 100 years.  Farming animals, growing crops, and forestry uses over half of New Zealand's available land.  Farming and forestry employed about 8.5 percent of employed people aged over 15 years in 2001.

Major Commodities Exported Year ended 30 June 2002

Mount Albert Grammar School, Auckland, New Zealand

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Changes in Farming  Dairy and deer farming are continuing to expand while sheep and beef farming are declining.  Grazing and arable land use has decreased by 12 percent since 1994 to 12.0 million hectares in 2002.

Use of Agricultural Land Year ended 30 June 2002

Changing Land Use Patterns  Grazing and arable land use has decreased by 12 percent since 1994 to 12.0 million hectares in 2002.  Horticultural land use has increased by 6 percent since 1994 to 110,000 hectares as at 30 June 2002.  More land is being used for horticulture as the area planted in wine grapes continues to increase.  The area planted in production forest has increased by more than a quarter since 1994 as marginal farming land is converted.

Mount Albert Grammar School, Auckland, New Zealand

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ANIMAL FARMING IN NEW ZEALAND

 Sheep, dairy and beef cattle and deer are the main animals farmed in New Zealand.  Other animals farmed include goats, pigs, poultry, ostriches, emus and alpacas.

Mount Albert Grammar School, Auckland, New Zealand

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Pastoral Agriculture Pastoral agriculture is practised throughout New Zealand and mainly comprises beef cattle, dairying, and sheep farming. However, deer farming is also an important livestock industry. Deer are farmed for venison and velvet. Stock are grazed in paddocks, often with movable electric fencing, which allows rotation of grazing around the farm. Grass growth is seasonal, largely dependent on location and climatic fluctuations, but normally occurs for between 8 and 12 months of the year. Many farmers supplement grass feed with hay and silage, particularly in winter. Phosphoric fertilisers are used extensively on New Zealand's predominantly grass/clover pasture. Nitrogen fertilisers are used to a small degree.

Mount Albert Grammar School, Auckland, New Zealand

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Livestock Numbers Probably New Zealand's best known statistic is that it has more than 20 times as many sheep as people (actually now close to 13 times as many). Grasslands have been developed to the extent that the best sheep farms can carry up to 25 sheep per hectare throughout the year. The best dairy farms carry 3.5 cows per hectare throughout the year. Trends in livestock numbers are largely determined by world market prices for farm products, including meat, wool, dairy products and, more recently, venison, and goat fibre. Over the last 14 years MAF records that the sheep population has declined from 70.3 million at June 1982 to stand at around 46.2 million at June 1999. The beef cattle population was around 4.4 million at June 1999 and the total number of dairy cattle at June 1999 is estimated to have also risen to being around 4.4 million. There are currently around 1.2 million deer in New Zealand.

Mount Albert Grammar School, Auckland, New Zealand

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Meat Meat industry products are New Zealand's second largest export income earner, accounting for about 17 percent of merchandise exports. New Zealand's main meat exports are lamb, mutton and beef. About 91 percent of lamb, 79 percent of mutton and 83 percent of beef produced in New Zealand in 1998–99 was exported overseas. The domestic market absorbs over 99 percent of pigmeat and poultry produced in New Zealand. As a result of weather conditions, stock numbers have been lower in the past two years. Sheep numbers at 30 June 1998 totalled 46.2 million and were down 1.8 percent on the previous June. This figure remained almost static at 46.1 million for the year ended 30 June 1999. Beef cattle numbers at 30 June 1998 totalled 4.43 million, down 7.7 percent on the previous June, and continued to decline by another 1.5 percent to 30 June 1999.

Mount Albert Grammar School, Auckland, New Zealand

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Meat New Zealand Meat New Zealand is the operational name of the New Zealand Meat Board. It exists to further the interests of New Zealand's 32,000 meat producers. The board does not buy or sell meat. It is funded by producers through a levy on stock slaughtered and is involved in market access issues, market development and information, international promotion, carcass classification and quality assurance. It provides market support through offices in Wellington, Brussels, London, Tokyo, Washington and Seoul. It also funds a number of industry organisations.

Export Marketing New Zealand is a major exporter of sheepmeat, accounting for about 53 percent of the world export trade. It is a smaller player in the global market for beef, accounting for about 10 percent of all world beef exports. New Zealand's major meat markets are the United Kingdom, Germany, France, Saudi Arabia and the United States for lamb; the United Kingdom, Germany, South Korea and France for mutton; and the United States, Canada, Japan, South Korea and Taiwan for beef. The top three of the 51 venison export markets for the year to 30 June 1999 were Germany, the United States and Belgium. Most of the venison produced in New Zealand is exported.

Mount Albert Grammar School, Auckland, New Zealand

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Mount Albert Grammar School, Auckland, New Zealand

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Sheep Farming in New Zealand  Sheep farmed in New Zealand totalled 39.5 million at 30 June 2002, the lowest number recorded since 1955.  Sheep numbers in 2002 were down 20 percent in New Zealand since 1994.  In 2002, there were about 10 sheep for every person in New Zealand – compared with 20 sheep for every person in 1982 when the national flock was largest, 70.3 million. Number of Sheep

Wool New Zealand sheep are largely dual purpose wool/meat animals and their wool is predominantly strong. New Zealand is the world's largest producer of crossbred (strong) wool. This type of wool is used mainly in interior textiles such as carpets, upholstery, furnishings, bedding and rugs. It is also used for handknitting yarn, in knitwear and in blankets. It is estimated that 34 percent of New Zealand wool is used in machine-made carpets, 12 percent in hand-knotted and hand-tufted carpets, 44 percent in apparel, and 10 percent in other uses, primarily upholstery and bedding. Net domestic consumption of wool in New Zealand is among the highest in the world on a per head basis.

Mount Albert Grammar School, Auckland, New Zealand

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The New Zealand Wool Board The New Zealand Wool Board promotes the use of New Zealand wool in new and existing markets; encourages efficiencies in the preparation, handling, distribution, shipping and selling of wool; and promotes and undertakes research and development work into wool, sheep and wool products. Sheep farmers fund the New Zealand Wool Board, each paying five percent of their annual wool sales. Wool Production Technology Ltd (WoolPro) works to improve wool quality, sheep production and on-farm efficiency. It funds new wool production technologies that provide New Zealand wool growers with information to help them improve or fine tune their wool production, and to meet customer demands. WoolPro runs wool harvesting training programmes, and the Fernmark Quality Programme, which is the only programme in the world that assures quality throughout the wool production and supply pipeline.

Wools of New Zealand Wools of New Zealand is the marketing arm of the New Zealand Wool Board. It promotes the use of New Zealand wool in existing and new markets; encourages efficiencies in the preparation, handling, distribution, shipping and selling of wool; and promotes and undertakes research and development work into wool, sheep and wool products. The board is entirely funded by woolgrowers.

Mount Albert Grammar School, Auckland, New Zealand

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Markets for Wool The most common way of selling wool in New Zealand is by open auction: 45 percent was sold this way in 1998–99. The auction season runs from July to the following June. Sales are held at two centres, Napier and Christchurch, and attract buyers representing all the main wool importing countries. Growers can also sell their wool to merchants privately in New Zealand (41 percent of sales in 1998–99). Around 90 percent of the New Zealand clip leaves the country in a greasy, scoured, or slipe form. Seventy-seven percent of exports are scoured. Of the 10 percent of the clip processed in New Zealand, roughly half is exported in product form, mainly as carpet yarn, carpets or knitted jerseys. During 1998–99 the largest importers of New Zealand wool were China, the United Kingdom, India, Germany and Belgium. Total export earnings from wool products were $285 million in 1998–99.

Mount Albert Grammar School, Auckland, New Zealand

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Dairy Cattle Farming in New Zealand  Dairy cattle totalled 5.2 million in 2002, up 34 percent since 1994.  The national dairy herd has increased steadily since 1991, when it numbered 3.4 million. In 1994 there were 3.8 million dairy cattle.  Dairy cattle numbers in the South Island have more than doubled since 1994 to 1.3 million in 2002, now comprising 26 percent of the national dairy herd.  In 2002 there were 1.3 dairy cattle for every person in New Zealand. Number of Dairy Cattle

Dairy Produce The dairy industry is primarily geared towards overseas markets which account for between 90–95 percent of all milk produced. The four major product groups manufactured by New Zealand dairy factories are: milk powders; cream products such as butter, anhydrous milkfat and ghee; cheese; and protein products such as casein and caseinates.

Dairy Organisations There are around 25 dairy factories producing manufactured dairy products in New Zealand. These are owned by eight cooperative companies. Each company is governed by a board of directors elected by farmer suppliers. Farmers fund the cooperatives by supplying share capital. The dairy companies produce nearly all of the dairy products manufactured in New Zealand, of which most is exported.

Mount Albert Grammar School, Auckland, New Zealand

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New Zealand Dairy Board The board is responsible for marketing dairy produce manufactured for export. It coordinates manufacturing and industry growth plans with export market requirements. The board exports to over 100 countries annually and has its own marketing distribution network in the countries it exports to. The Dairy Board is the largest multinational dairy marketing organisation in the world. It has more than 89 fully owned subsidiaries, associate companies and agencies.

Mount Albert Grammar School, Auckland, New Zealand

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New Zealand Milk Overseas Marketing and Exporting New Zealand is one of the top five dairy exporters in the world which supply around 90 percent of dairy products traded on the international market. The New Zealand dairy industry's major markets vary for different products. Britain and the EU are New Zealand's most valuable market for butter. The primary markets for casein and cheese are the United States, Japan, and the EU. New Zealand is the world's largest exporter of casein and caseinate products. New Zealand's most important milk powder markets are in Central and South America and South-East Asia. Exports In 1998 the state of the world economy with financial problems in parts of Asia and Latin America and in Russia led to a reduction in demand for dairy products. The Russian financial crisis had a major impact on the butter and cheese markets. Russia was the world's largest importer of butter and cheese from New Zealand in 1997, taking one-third of all cheese exports and sizeable quantities of butter from New Zealand. The lack of sizeable replacement markets led to a drop in prices. Despite the decrease in demand, New Zealand dairy product exports grew slightly in 1998–99 to 1,355,000 tonnes. This was despite a 4 percent drop in New Zealand production as a result of drought conditions in much of the country.

Mount Albert Grammar School, Auckland, New Zealand

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Beef Cattle Farming in New Zealand * * *

4.5 million beef cattle were farmed in New Zealand at 30 June 2002. Beef cattle numbers have dropped 11 percent from 5.0 million in 1994. The South Island beef herd remained relatively unchanged in 2002 but the North Island herd decreased by 14 percent since 1994. Total Beef Cattle Numbers

Mount Albert Grammar School, Auckland, New Zealand

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Livestock Slaughter Production

Mount Albert Grammar School, Auckland, New Zealand

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CROPS AND HORTICULTURE Although pastoral farming is the major land use in New Zealand, in recent years there have been significant increases in the area planted in horticulture and other crops. After a period of decline in the 1980s the area planted in traditional cereals, such as wheat, barley and maize, is stabilising. This has occurred as the profitability of cereals has improved relative to that of other crops and farm enterprises. There has also been an increase in plantings of pasture seeds and specialist crops. Major crops for the export market include kiwifruit, pipfruit, stonefruit, onions, squash, flowers and berryfruit. Grapes are grown mainly for the domestic market and for wine production.

Main Grain and Seed Crops New Zealand wheat is primarily grown for domestic human consumption and is milled for flour. Some wheat grain and the by-products of flour milling, bran and pollard, are used for stock feed. Most wheat is grown in the South Island in the Canterbury region. Most barley grown in New Zealand is used for the manufacture of stock feed and for malting. Exports of malting and feed barley fluctuate in response to price changes, reflecting international supply and demand. Primarily grown in the eastern North Island, maize is used as poultry feed and increasingly as a supplementary feed for pigs and other livestock. Grown mainly for threshing and green feed, oats are also used to produce milled rolled oats, oatmeal, and oaten foods. Hay and silage crops are grown for supplementary animal feed. They are almost exclusively grown on the farms where they are consumed. The renewal and extension of pastures require the annual supply of very considerable quantities of grass seed. There is an appreciable export trade in some species of grass seed.

Mount Albert Grammar School, Auckland, New Zealand

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Pipfruit New Zealand's main pipfruit growing areas are Hawke's Bay and Nelson. Almost 70 percent of the New Zealand pipfruit industry's export income is derived from the apple varieties Braeburn, Gala and Royal Gala – which were all developed in this country. ENZA is the marketing arm of the New Zealand Apple and Pear Marketing Board and is responsible for the sales of all export-grade apples and pears from New Zealand except those sales made by organisations which have received an export component. In 1999 ENZA exported about 17 million, 18 kilogram cartons of apples and pears on behalf of New Zealand's 1,500 pipfuit growers. These exports generated a total income of $519,725,000.

Mount Albert Grammar School, Auckland, New Zealand

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Summerfruit The main production areas for summerfruit are Central Otago, Hawke's Bay, Marlborough and Canterbury. At 30 June 1999 the total area planted in summerfruits was around 3,000 hectares. These were mainly peaches, nectarines, apricots, plums and cherries. The Summerfruit Export Council of the New Zealand Horticulture Authority is the main exporter of summerfruit.

Kiwifruit The Bay of Plenty is the major growing area for kiwifruit with over 80 percent of production. Kiwifruit is one of New Zealand's most important horticultural export earners. New Zealand is a major supplier of kiwifruit and has led the development of the industry globally. ZESPRI International is the world's largest marketer of kiwifruit and the sole marketer of the ZESPRI™ kiwifruit, exporting around 59.4 million trays of kiwifruit annually to about 60 countries. It is the global marketing subsidiary of Kiwifruit New Zealand. Total kiwifruit exports were worth $429 million in the year to June 1998. Kiwifruit New Zealand is responsible for industry governance and onshore grower equity issues, inventory, quality and administration.

Grape Growing and Wine Production Marlborough, Gisborne and Hawke's Bay are the major grape producing areas. In 1999 an estimated 9,000 ha were planted in producing grape vines. Exports of wine increased from 15.2 million litres in 1998 to 16.6 million litres in 1999. The United Kingdom, which imported 9,041 million litres of wine from New Zealand in the year to 30 June 1999, is New Zealand's major export market for wine. Australia is the second-largest export market. The 1999 season was New Zealand's largest wine vintage, producing 79,700 tonnes of grapes. Chardonnay (17,823 tonnes), Muller Thurgau (8,941 tonnes) and Sauvignon Blanc (20,580 tonnes) were the most popular grapes of the season. Mount Albert Grammar School, Auckland, New Zealand

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PIGS, POULTRY AND BEES

Pigs Domestic pork production increased slightly in 1998 after declining since 1995 due to increasing pressures from the importation of competitively priced Canadian, Australian, American and Danish frozen pork, and relatively high feed costs. For the year ending September 1999, 776,508 pigs were slaughtered, a decrease of 10,348 from the previous year. The tonnage of domestic pigmeat produced dropped to 47,618, from 48,338 tonnes in the previous year. New Zealand Pork Industry Board The Pork Industry Board is a statutory body. Its income is sourced from a compulsory levy on all pigs slaughtered at licensed premises. The board comprises seven members, five of whom are elected by producers and two who are appointed by the government. The Pork Industry Board is concerned with extending markets, research and development, encouraging best practices and making market information available.

Poultry The poultry meat industry is relatively new in New Zealand and is expanding rapidly. It is now the major intensive livestock industry in this country. In 1998 the poultry industry produced 98,000 tonnes of poultry meat, almost solely for the domestic market. Of this total, over 95 percent was chicken meat produced from about 65 million broiler chickens; with turkey, duck and roasting fowl making up the remainder. The industry earns around $550 million in retail sales and provides about 3,000 jobs. Poultry consumption continues to increase due to declining prices in real terms, changes in lifestyle and consumer perceptions. Consumption has increased from 14 kg per capita 10 years ago, to over 26 kg in 1998. The proportion of poultry meat consumed has increased from 15 percent to 25 percent of total meat consumption. This increase has been largely at the expense of sheepmeat.

Mount Albert Grammar School, Auckland, New Zealand

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Eggs In 1998 New Zealand's estimated 2.2 million laying hens produced close to 756 million eggs. Over 85 percent of eggs are sold as table eggs within the domestic market, with the remainder used in the baking and catering industries. Retail sales of eggs are worth more than $160 million. Total egg production has remained relatively static for the past decade, with slight drops in per capita consumption – now around 200 eggs per person annually. Most eggs produced in New Zealand are from caged hens, with free range and barn egg production accounting for 5 percent of the total. New Zealand currently has around 130 commercial egg producers, with the largest 20 producers accounting for over 50 percent of total production. Since the industry was deregulated in the late 1980s the number of commercial egg producers has declined rapidly. The Egg Producers Federation of New Zealand Inc (EPF), funded via producer levies, represents the industry and plays a growing role in research funding and direction.

Bees The rich pasture lands of New Zealand and some of its forest and bush areas are suited to apiculture and produce high-grade honey. Clover (Trifolium repens) is still the principal honey type. A number of New Zealand native honey sources also have wide national and international consumer appeal. In 1992 researchers confirmed that manuka honey (Leptospermum scoparium) is very effective as an antiseptic dressing. Because of this both the demand and the price for manuka honey have risen dramatically. The total saleable crop of honey for 1999 was 9,069 tonnes. Exports of honey totalled around 2,500 tonnes. The industry's other products include beeswax, pollen, propolis (an antibiotic gum or resin collected from plants), royal jelly and live bees. The National Beekeepers Association levies beekeepers with more than three apiaries or 10 hives to pay for its activities as well as its pest management strategy.

Mount Albert Grammar School, Auckland, New Zealand

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SUMMARY  New Zealand agriculture has found that there is "life after subsidies".  In fact, few farmers now wish to return to the days of government support.  New Zealand now has an extremely internationally competitive agricultural sector. For example, efficiency gains have increased returns to New Zealand lamb producers by approximately 25% when compared to 10 years ago. Market prices and consumer preference drive farming decisions rather than the production push as previously. Quality is very important. New Zealand is very concerned to maintain its clean, green image.  Inflation proved to be a major destroyer of farm profitability. High inflation reduced international competitiveness, thereby reducing returns, whilst increasing farming costs. New Zealand's inflation rate over the last few years has been considerably lower than our trading partners, and this has further enhanced New Zealand's competitive advantage.  Companies and individuals now have full market led responsibility for production decisions. They reap the rewards and take the risks of their decisions. Business management skills have improved significantly in New Zealand in the market led environment.  There is now a much reduced risk of making wrong decisions. Rather than the government picking winners, and supporting particular ventures, decisions are now made by a large number of individuals. The consequences of any one decision-maker getting it wrong is now much less.  For New Zealand, additional benefits will come from freer international trade in agricultural products. It remains exasperating to New Zealand farmers that much of the international competition New Zealand faces is from subsidised production.

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Key Lessons from New Zealand's Experience  Exposing New Zealand farming to international market signals improved the efficiency and international competitiveness of New Zealand's farming sector;  Farming which is internationally competitive can be profitable without government support (even in the absence of free international trade);  People will undertake strategic planning and make longer term decisions in a stable political and economic environment;  People and organisations are more resilient than expected, although the change process is stressful;  People and organisations are required to be more innovative in a less regulated economy exposed to international competition;  Farm business management practices improve considerably in a market-driven environment;  Quality has become a very important issue. Consumers determine quality, not producers;  New Zealand farmers would now rather farm under the current situation than where they were previously.

Mount Albert Grammar School, Auckland, New Zealand

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