With the lowering of the farmgate milk price comes the squeezing of margins.
That's the message from Rabobank’s senior horticultural analyst Hayden Higgins.
He says this has to be done to maximise returns from the rapidly-growing Chinese fruit and vegetable market.
Speaking at the Horticulture New Zealand Conference in Christchurch last week, Higgins said, while food safety, quality and nutrition credentials were currently the most significant factors influencing Chinese consumers’ food purchasing decisions, awareness of other product characteristics, including sustainability attributes, such as water usage and emissions, was growing.
“Chinese consumers are looking for food products which are high quality, nutritious and have strong food safety credentials and New Zealand’s fruit and vegetable producers have been able to command a price premium in the Chinese market by supplying products which possess these attributes,” he says.
“While China has historically shown little interest in point-of-origin sustainability attributes if the product comes from outside of China, we are starting to see some changes in this area with Chinese consumers becoming increasingly aware of wider sustainability issues.”
Higgins said it would be vital for New Zealand’s horticultural sector to keep abreast of Chinese consumer views on sustainability issues, such as water usage and pollution, develop.
“The sector would be wise to monitor this situation carefully as we expect to see point-oforigin sustainability attributes become increasingly relevant in the Chinese market.”