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The rural sector is muddled and looking for the best way forward amid a wave of regulations, Covid-19 related fatigue, and varied outlooks for different parts of the industry.

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KPMG’s head of global agribusiness Ian Proudfoot says the sector is facing a multitude of demands, from labour shortages, decarbonisation, biotechnology and growing regulation.
Photo: RNZ/Susan Murray

Business advisory firm KPMG’s Agribusiness Agenda found a mixed picture among 122 primary industry leaders, with some straining to make the most of profitable overseas opportunities, while others were fighting to survive.

KPMG’s head of global agribusiness Ian Proudfoot said no single theme stood out for the sector with a multitude of issues vying for attention.

“For some leaders, things have never been better; others face an existential crisis, while many have aspects of their operations that are humming and other parts that are on, or are close to, life support.”

He said the sector was opportunity-packed and risk burdened by “high highs” and almost as many “low lows”, and had done a remarkable job in reconnecting with world markets and earnings record returns when the country needed it most during the pandemic.

However, he said the sector was facing increasing demands from a rising number of issues ranging from coping with labour shortages, decarbonisation, through to biotechnology and growing official regulation.

Boiling tension

“For some in the sector, tension and frustration are boiling over, but the focus must be on what is controllable to catch the many opportunities inherent in the crises and challenges we face,” Proudfoot said.

He said the sector needed to progress as a whole where it could and if there were elements which were not on the “same bus” then they should be left behind, to catch up at a later time or consider whether they should still stay in the industry.

Proudfoot said the government and other policy makers needed to prioritise which regulatory issues they wanted to achieve and do them well rather than confront the industry with a broad wave of regulations which were poorly handled.

And he said the sector needed to find a solution between achieving world class food supply to overseas customers while delivering a lesser service to domestic users.

“We need different business models to lift the resilience of domestic food producers. A failure to provide accessible, quality, nutritious food to all New Zealanders will ultimately impact our ability to continue to generate the export returns we enjoy today.”

The top priorities among the leaders were unchanged at delivering a world class bio-security system, signing high class trade deals, and broadband equity for all.

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