Future for N.Z. wheat

Press, 5 November 1984, Page 14

Future for N.Z. wheat

Mr J. K. Ireland, managing director of the Ireland Group, Ltd, has replied to a leading article on the wheat industry in New Zealand. The article appeared in “The Press” on November 2. Mr Ireland is a member of the Wheat Board, the Wheat Research Committee, the Bakers’ Association, and the Flour Millers’ Association. The Ireland family has been prominent in milling and baking in New Zealand since 1870. In his reply, Mr Ireland writes:

The leading article in “The Press” concludes with the comment that the first and most noticeable change following the relaxation of controls over the New Zealand wheat and flour industiy should be an improvement in the quality of flour and bread. This is an opinion which you will find some difficulty in substantiating because in the opinion of most of those who are in a position to compare Australian bread with New Zealand bread, the local product is more acceptable.

The usual criticism of the Australian product is that it is too soft and has poor flavour and is too much like cake in texture. It does, however, keep for a longer period, but this is due in the main to nonwheat additives, some of which are not permitted in New Zealand manufacturing bread. In any case, over 100,000 tonnes of Australian wheat will have been imported by the Wheat Board for use by New Zealand flour mills by the end of 1984. With the exception of Otago and Southland the use of this wheat has not mproved the quality of New Zealand flour or bread.

There are, however, advantages (not connected with bread quality) to the miller who uses Australian wheat rather than New Zealand wheat. These are, in the main, due to the lack of variations in quality caused by local climatic circumstances, but also because the Australian miller draws from stock piles of several million tonnes held by the Australian Wheat B °lf r the New Zealand miller had similar advantages, his job would be made much easier and he, in turn, would be able to compete with Australian flours more effectively. There are few in New Zealand who would disagree with the statement that a review of the wheat and flour industries and the conditions under which they are operating was necessary, but the apparent simplicity of the system which •grows wheat and conveaS it into flour and bread is deceptive.

The stated intention of the development of C.E.R. is to develop trading between Australia and New Zealand and to introduce more competition on an equitable basis to the New Zehland market. Some New Zealand industries, and indeed some Australian ones as well, have been used to a fair degree of regulation and consequently protection. ■ Because the infrastructure of an industry reflects the terms and conditions in which it operates, a rapid adjustment in such circumstances can cause needless waste of assets, opportunities, and unnecessary unemployment. The New Zealand and Australian negotiators and governments have been fully conscious of this, and full trading relationships between the countries will Consequently will not be achieved until 1995.

Because of the high degree of regulation of the New Zealand wheat growing and flour milling industries, and the traditional lack of competition with overseas wheats and flours, the proposed rapid change to free trading within New Zealand and the accelerated exposure to imports will certainly have all the above effects. The first and most obvious reason for this is that New Zealand wheat varieties have been developed within a policy of self sufficiency and the minimising of imports of wheat. This has led, particularly Goverment wheat breeding scientists, to develop wheat varieties which are particularly suited to the New Zealand climate, which as everyone knows is quite different to the climates in the wheat growing areas in Australia. < .

The New Zealand scientists have, nevertheless, been particularly successful in developing wheats which not only have a high yield per hectare .' and disease resistance, but also 'make it possible for the miller to product flour of good quality. However, the New Zealand flour is not as suitable for some uses ® flour made from Australian wheat, par-

ticularly for starch manufacture and other specialty uses. It is also much more readily available at certain times than New Zealand wheat. Growers in New Zeland will suffer through no fault of their own because of the proposed ready availability of Australian wheat after 1987. It was for this reason that millers recommended a minimum lead-in. period of five years, not two, so that a wider range of wheat varieties could be developed. A new variety of wheat may. take as long as 20 years to develop so that five years is little enough time. It follows from this that New Zealand millers will lack the locally produced raw material with which to make flour which is in all respects competitive with the Australian imported product. I disagree strongly, however, with the statement that there will be an immediate and obvious improvement in the quality of flour and bread in New Zealand. This implies, incorrectly, that the quality of these products is unsatisfactory, but given the limitations of the wheat distribution system in New Zealand arid of the varieties which have been developed to suit New Zealand conditions the (resultant) bread and other products are of high quality indeed and for certain purposes are superior to the Australian product. Regrettaby, however, some of these are of low trading volume. None of the apparent deficiencies in the New Zealand system are permanent and all could be corrected painlessly, and with minimum loss to the nation, if sufficient time were allowed for the industries to adjust. The initial period of only two years for adjustment will result in unnecessary hardship. Unnecessary because no reason has been , advanced for not allowing the industries concerned more adequate time. There is certainly nothing that I have seen in the C.E.R. Agreements which necessitate? such hasty action. ;