Bring on meat industry overhaul: CEO

Keith Cooper, CEO of Silver Fern Farms. Photo / Hawke's Bay Today

Silver Fern Farms, New Zealand's biggest meat processing and marketing firm, will be a willing participant in any future restructuring of the industry, says its chief.

Keith Cooper, chief executive of the company, said his firm realised the sheep and beef farming sectors were "broke" and changes to the industry's structure were needed.

His comments follow Ministry of Agriculture and Forestry figures released this week showing sheep and beef farming profits declining in 2009/10, with the average price of lamb falling by 10.3 per cent on the previous year. Federated Farmers meat and fibre chairman Bruce Wills, responding to the MAF figures, said alling profits were prompting increasing numbers of sheep and beef farmers to convert to dairying and forestry.

"I've seen figures of a couple of hundred dairy conversions in the South Island alone happening in the next 12 months."

He said there were "too many meat companies chasing too few lambs" and if the structural issues were not sorted out New Zealand would be "covered in dairy farms and pine trees".

But Cooper said an effective strategy needed to be identified by the industry before restructuring could take place.

"You need to work out which strategic direction we need to take ... and then which companies are aligned and then perhaps start merging."

Wills said the Meat Sector Strategy, launched by Beef and Lamb New Zealand and the Meat Industry Association last month, was the first step in getting a combined strategy for the industry.