From New Zealand to Indonesia: Zeroing in on industry, innovation, and infrastructure in agribusiness
24-year old Jemima Snook is from rural Timaru, and majored in Farm Management and Accounting at Lincoln University. She spent her summers working on dairy farms and sheep and beef stations. After graduating last year she spent six weeks in Indonesia, learning about the opportunities and challenges for Indonesian agribusiness and New Zealand food exporters. She now lives in Christchurch and works in the agribusiness division at BDO Christchurch Limited, an accounting and consultancy firm.
I studied Farm Management and Accounting at Lincoln University, which prides itself on being “New Zealand’s specialist land-based university.” But as any student knows, there comes a time when you’ve had enough of the lecture theatre, and after completing my degree last year I leapt at the opportunity to study in Indonesia, as a chance to go directly to the source to learn about the opportunities and challenges facing agribusiness in a developing country.
One of the United Nation’s Sustainable Development Goals that I am most passionate about is Number 9 – Industry, Innovation, and Infrastructure. It is reported that in developing countries, barely 30 percent of agricultural production undergoes industrial processing, while in high-income countries such as New Zealand, 98 percent is processed. Supporting the development of agribusiness in developing countries is critical, and from my experience in Indonesia I saw how the lack of infrastructure and technology could hinder agricultural production, and contribute to inefficient use of resources.
In contrast to Indonesia, New Zealand has a highly developed agricultural sector built on good infrastructure and innovation. While the population of New Zealand is only 4.7 million, according to New Zealand Trade and Enterprise we produce enough food to feed 40 million people, and as a result, our agricultural products are exported around the world. Why is this the case? A temperate maritime climate helps, as does having a large agricultural land area available, in relation to our population. However, the deregulation of New Zealand’s economy – including the removal of agricultural subsidies in the 1980s – has also been a driver of innovation and investment into infrastructure. Without agricultural subsidies, farmers found that they needed to become extremely efficient low-cost producers in order to compete on the world export market. Over the years, as other countries have developed their ability to produce low-cost food, New Zealand has had to move towards adding value to our products – an approach which can provide better returns to producers, but which is also a more challenging path to take. To be good producers of high-value food, we need more innovation and investment in areas such as food processing and supply chains.
Producing high-value products is often associated with producing less (i.e. “quality not quantity”) – so how does New Zealand then contribute to producing more food to help feed a growing global population in the future? While New Zealand technically has the resources to intensify agricultural production and produce more food, in the long-term this is not a sustainable solution in terms of protecting our environment and natural resources. A better way for New Zealand to contribute to food security is by the sharing of farming knowledge and investment in infrastructure in other developing countries. One example of this is the way in which Fonterra (our leading dairy exporter) has invested in dairy farms and processing plants in developing countries.
While I am not directly involved in hands-on farming, in my career as an agribusiness consultant I want to be able to help young people involved in agriculture identify their passions and goals, develop their business strategy, and learn how to utilize financial tools to support and grow their businesses. In this way I feel I will be contributing to the development of infrastructure, innovation, and industry in New Zealand. We all have a role to play in producing food around the world, whether directly or indirectly. That’s why I am looking forward to the Youth Ag Summit, to share knowledge with other young leaders involved in different areas of agriculture.