New Zealand businesses are poised to re-enter the Chinese beef processing sector which proved spectacularly unsuccessful for one of New Zealand's largest meat companies, Affco, on a turn-of-the millennium foray behind the bamboo curtain.
Today two smaller companies will sign the first agricultural deal under the New Zealand-China free trade agreement at a ceremony attended by Prime Minister John Key.
The strategic co-operation agreement is between New Zealand food logistics company FoodCap International, angus genetics specialists Te Mania Livestock and China's second largest beef processor, Kerchin Cattle Industry Ltd.
The agreement in Beijing opens the way to establishing FoodCap distribution plants in key strategic parts of China, improving the beef breeding stock in Inner Mongolia and growing substantial high-end markets for a wide range of New Zealand beef and other meat products, the companies said.
FoodCap is controlled by the Palmer family, headed by Roger Palmer, and one of its directors is Te Mania principal Tim Wilding, of Parnassus, North Canterbury, whose own business has Chinese shareholders, Hong Wei Guo of Beijing, and Chun Win Wong, of Singapore.
Mr Palmer's FoodCap meat packaging system - which can link storage, aging, transport and handling to ensure that angus beef reaches the supermarket in peak condition - attracted strong interest from Kerchin, which wants to develop both its food safety systems and its animal husbandry.
Auckland-based FoodCap has created handling systems for fresh chilled food and other temperature-sensitive, short shelf-life products, which can take perishable retail-ready packs of food all the way from the processing plant to the retail display.
Te Mania has more than 2000 registered angus cows and is Australasia's largest registered angus seed stock producer, supplying genetics worldwide, including an initial joint venture in China in 1996.
Kerchin Cattle Industry Ltd, based at Tongliao city in Inner Mongolia's Kerchin grasslands, employs about 800 staff, and said on its website that it had a manufacturing capacity of 20,000 tonnes of meat annually from both cattle and horses.
Affco invested in the Wuliangye Affco Golden Ox joint venture, a $20m meat processing plant in Chengdu City in the central Chinese province of Sichuan a decade ago, but later said the plant had been built too far to the west and that there was a shortage of animals for slaughter.
At one point there was talk of Massey University working on crossbreeding yaks on the Tibetan plateau to provide livestock, but later executives admitted that business in China was harder than expected, and it hadn't been able to obtain sufficient margins. It also claimed that one of its joint venture partners "has since done a runner and is being pursued by the police".
NZPA and NBR Staff
Wed, 07 Jul 2010