Monday, March 20, 2006

Roger Pikia: Roadshow aims to boost productivity in Maori pastoral sector

AgResearch's aim to help double productivity on Maori farms from $800 million to $1.6 billion by the year 2020 is a bold but achievable aspiration.

Maori are the largest natural grouping of pastoral farmers in New Zealand, farming an effective area of 720,000ha and growing. Even small changes, including the development and implementation of existing and new technology and improving management and staff skills, would make a difference to the bottom line.

Freeing up equity in the land, worth an approximate $7.5 billion, would also be a key to seeing some real movement in increased productivity. That has become more realistic as lending institutions offer increasingly innovative packages, which is a great sign for growth and expansion hopes, because Maori already retain about 95 per cent of that equity.

I am a farmer and aware that at AgResearch we know what it takes to manage and operate a successful farm and make it a money machine using specialised technology without increasing labour and resource input.

We also know the Maori pastoral sector is a winner waiting to happen for the good of the New Zealand economy. On average, Maori sheep and beef farms, which have a classification of class four land - North Island medium hill - operate at about 70 per cent of the national average in terms of productivity.

That 70 per cent obviously unfairly hides well performing Maori farms, which lift the average of the poorer performing farms.

If the productivity of this land is increased to the national median for national Economic Farm Surplus (EFS) of $124 per hectare, it would return to Maori and New Zealand an extra $32 million per annum just like that. Top Maori farms return an average EFS of $350 per hectare.

To put things in perspective, even with the productivity average of 70 per cent, the Maori pastoral sector is already almost twice the size of New Zealand's entire wine industry, which is exciting when you relate that to the potential to be gained.

So the "roadshow" that I will embark on around the North Island, starting this week with public meetings in Opotiki and Tauranga, and moving through every key Maori farming area in New Zealand by the middle of this year, is the beginning of our bid to reach Maori farmers and stakeholders to raise awareness of AgResearch's intent to deliver sustainable economic and social benefit to Maori through its science research capability.

It is also about listening to stakeholders' issues and incorporating those into our strategy.

I am confident that this strategy, which is driven by AgResearch's "2020 Science Strategy", which has five big ideas to lead the pastoral sector through the next 14 years and beyond, will provide the backbone of a surge in productivity gain for the Maori pastoral sector through the implementation of focused initiatives leading to scientific and commercial research outcomes from projects with Maori to achieve the set targets.

Simply put, a key to this is producing products inside the farm gate and retaining some control of the added value further along the value chain instead of waiving goodbye to it all at the gate only for others to reap the rewards.

That means Maori positioning themselves strategically to ensure they are not just producers of product inside the farm gate but that they also benefit from the product after it leaves and makes its way on to our dinner plates. When that happens the better off the Maori pastoral sector, and New Zealand's economy, will be.

At the moment about $54 million of the $800 million in current productivity comes from inside the farm gate.

The remainder, almost a massive $750 million, comes from what happens to the product once it has left the farm.

I know that Maori farmers are interested in using AgResearch's scientific expertise to help them develop new products and achieve better practices and this roadshow will help form some processes to allow it become a reality.

It is not going to be easy but Maori are going to be long-term players in the sector with intergenerational handling of land so the sooner positive steps are made to improve the financial status of the sector in general, the sooner we will start to see positive shifts in productivity gain.

Everything AgResearch is doing has relevance to all farms in New Zealand and is not exclusively for the Maori pastoral sector.

But for the purpose of this strategy, AgResearch is giving particular focus to the Maori sector because of the obvious significant gains to be made in terms of productivity which relate to the well-being of our country.

I am excited by it and it is enormously exciting for AgResearch, the Maori pastoral sector and New Zealand as a whole.

* Roger Pikia is AgResearch's Maori strategist

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