Research on market prospects for food

Press, 14 May 1984, Page 9

Research on market prospects for food

Research that the Planning Council was completing on the market prospects for New Zealand’s main agricultural products gave a broadly positive view, but success would depend heavily on the capacity to be cost-efficient, the chairman of the Planning Council, Mr lan Douglas, told the Pio Pio Lions Club on Friday evening.

He was commenting on a study, “Towards a Marketing Strategy for New Zealand Agriculture,” on which the council is working in association with Federated Farmers and the producer boards and which is expected to be ready for release about August. “The picture presented by this important study is one of both opportunity and of difficulty, but to my mind, the positive aspects far outweigh the negative,” Mr Douglas said.

“The growth in demand for food is there for us to exploit. If we are to do this successfully, we must come to terms with a global market scenario that is changing rapidly and fundamentally. “The changes are not just in food demand, but also in the patterns of production, processing, transportation, distribution and retailing. There is increasing specialisation and at the same time, increasing integration, both vertically and horizonW” . .. .

Mr Douglas said that many of the markets into which New Zealand would be moving would be first and foremost price markets.

“If we cannot meet the required price levels, there will be plenty of competition to take our place. “This brings us right back to the fundamentals of management within the econ-

omy,” he said. “It reinforces the need for the Government to continue steadily but resolutely with the process of deregulation, the reduction of protection, and the achievement of greater rationality and uniformity in our industry assistance structures.

“It also emphasises the need for sound management of monetary and fiscal policy, within the context of realistic medium-term objectives.” Mr Douglas said that the promising future would not be realised unless the agricultural sector was prepared to live with a lower level of subsidy and with industry assistance mechanisms that did not insulate production and processing from the realities of the marketplace. “Subsidies and cost-effeo tiveness are mutually exclusive,” he said.