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  1. New Zealand Cold Storage Association 82nd Annual Conference Peter Brown, Specialist Adviser, MPI Verification Services ,Regulation and Assurance

  2. UV is useful • Peter Silcock from Horticulture NZ • UV light is a positive thing for fruit quality • A point of difference for NZ product

  3. Overview • MPI update • Global Picture • Stores Update

  4. Another Year As we all know - MAF renamed as the Ministry for Primary Industries (MPI), creating a single unifying identity for the recently merged organisation. Martyn Dunne – Chief Executive and Director General Scott Gallacher – Regulation and Assurance – DDG

  5. Robo Bank • Marc Soccio stated correctly the world is after and in need of high quality food – big demand for protein • This is what NZ does but lets get it right

  6. Our Strategy 2030

  7. Other Year • The Ministry for Primary Industries and the Cold Store Association are committed to working together to keep product safe, compliant and moving • We live in a fluid changing world. The rules change / legislation changes and expectations change. • Some of our main markets are in some volatile countries – China – Russia – They do call the shots • Look at the Dairy sector - We have taken a hit over the China Market. Media was all over it. We front it, learn and take positive action. • This cost the government many millions dollars

  8. MPI Strategy MPI has developed a new organisational strategy that has a clear vision of “growing and protecting New Zealand”. • The focus of the strategy is to maximise export opportunities, • The strategy also will see: • A strong focus on identifying and maximising opportunities for Māori fisheries and agri-business. • A more consistent approach to regulations across the fisheries, agriculture, food and forestry sectors. • Science having a stronger voice in decision making within MPI. • MPI’s approach is to enable and partner with its stakeholders to help them to be successful. • As a result of Our Strategy 2030, stakeholders and staff should expect a Ministry that is agile, informed, adaptable, continuously improving its services and known for focusing on relationships and results.

  9. Our Priorities • Over the next decade or so, global demand for quality food and forestry products is expected to increase, largely driven by growth in China and other Asian economies. This creates huge opportunities and some major challenges for New Zealand’s primary producers and exporters. • Our priorities have been developed in line with Our Strategy 2030. They help us enable and partner with the primary sectors in ‘going global’ and taking maximum advantage of these export opportunities. They also support our work in ‘leading local’ – improving sector productivity, increasing sustainable resource use, protecting from biological risk and maintaining animal welfare standards and safe food systems.

  10. Overview MPI As an organisation, MPI keeps its focus on the success of the primary industries for the benefit of all New Zealanders. This is captured in our vision of ‘Growing and Protecting New Zealand’.

  11. Overview MPI Our Strategy 2030 sets out how we plan to achieve that vision, and its four building blocks: • First, maximising export opportunities • Second, improving sector productivity • Third, increasing sustainable resource use, and • Fourth, protecting from biological risk. The fact is to continue leading, regulating and enabling the primary sector, MPI needs to be readying itself today for the pressures of tomorrow.

  12. Working on improvement • MPI’s organisational structure • We recently carried out a structural alignment of MPI to strengthen our core functions • We are placing an increased emphasis on being a more integrated, responsive and accountable organisation. •  MPI is totally committed to making it easier for our customers to access our advice and services.

  13. Importance of primary industries Our primary sector has traditionally been celebrated as the powerhouse of New Zealand’s economy.   Maximising export opportunities • The current year to June has an export forecast of $36.5 billion. •  It’s not all about dairy. The red meat sector makes a huge contribution, with annual exports of $6.9 billion. • Even thou Marc from Robo Bank says exports may start to slow down, or our market soften

  14. Importance of primary industries Other than dairy MPI’s forecast is for the value of New Zealand’s meat and wool exports to increase by about 22% over the next five years. We all need to work together on this. MPI is maximising our export opportunities by strengthening ties with existing markets and building relationships with new markets

  15. Importance of primary industries • Forecasts are that demand for sheepmeat will be driven by the expanding middle class in the Middle East and Asia. • Similarly, growing demand for beef imports is expected to be largely centred in Asia. • We know our dairy products are in huge demand

  16. Importance of primary industries

  17. Importance of primary industries

  18. Importance of Primary Industries and a lot of it goes through Stores

  19. Importance of primary industries China is now our number one trading partner for goods. Enabling our primary industry businesses to succeed in China will be a key part of achieving the government’s goal of doubling primary industry exports by 2025 In December 2013, the Government committed to increase MPI’s representation in China to seven positions in total.

  20. Tighter Controls • Our expectation is that tighter controls from a government process will be the norm. • Failure to monitor, adjust where necessary the outcomes and expenditure, runs the risk of reputational harm • Some may think this is burdensome but we know we have to get it right - the books right – records – systems – monitoring – training - meet all our NZ and MA rules

  21. Regulators • At the end of the day we MPI R&A are regulators • We have to follow the rules • Get it right • Protect NZ inc name • Protect our reputation

  22. Skills and Capability • There will be demand for more people in occupations with higher qualifications, especially for professional degrees in fields of specialisation aligned with the value chain. • Demand for training is likely to exceed the growth in employment. This is because there is a need to increase the skill level across primary industry occupations.

  23. Skills and Capability • In 2002, only 36% of primary industry workers possessed a post-secondary school qualification. • In 2012 that had increased to 44% and it is expected that by 2025 this will need to increase to 62%. • We predict we will need an additional 50,000 skilled workers on top of the natural attrition of workers by 2025.

  24. Skills and Capability Addressing this workforce gap will be a significant challenge, and it is critical that we are successful. In my view, this is an area that MPI and our different Industries mainly in the primary industries, need to focus on

  25. Biosecurity • MPI’s approach to biosecurity is one of risk management across the whole of the biosecurity system: pre, post and at the border; enabling us to direct our efforts and resources to focus on the things that matter most. • A significant failure of the biosecurity system is perhaps the single greatest risk to New Zealand’s economy and to reaching our export goal – both in terms of direct economic impact and loss of brand value. • eg fruit fly

  26. Biosecurity • Changing global demands, growing passenger and trade volumes, increasing imports from a growing number of countries, population expansion and climate change mean that biosecurity risk is growing. • MPI is doing its utmost to ensure that biological risk is minimised. We will need to do more. •  Significant new investment and improvements have been made at the border over the past 18 months, such as upgrading our X-ray detection technology and successfully recruiting and training nearly 125 new quarantine inspectors since December 2012.

  27. Biosecurity • By the end of this year we will have around 40 dog handling teams protecting our border. • Potentially more effort will be required in the future. How that is resourced will be a question for a wider discussion.

  28. Biological risk - FMD MPI takes a proactive approach to biological risk management - FMD   • We are in the process of finalising a report assessing the economic impacts of a foot-and-mouth disease or FMD outbreak on New Zealand. The work is being undertaken, in partnership with primary industry bodies, as part of a programme of activities to ensure New Zealand is well prepared for the event of FMD detection. • The report will improve the information base for decision-making on a strategy to respond to FMD detection. •  It will help identify possible trade intervention measures and help us target our preparedness activities to ensure the greatest return. •  It will allow informed input into a Government-Industry Agreement around cost and decision-making sharing for FMD eradication. • MPI is also progressing other aspects of Foot and Mouth Disease response • biosecurity laboratory surge capacity such as the new $64 million Wallaceville lab, the Trans-Tasman Action Plan, FMD training in Nepal, and re-signing the memorandum of understanding with the International Animal Health Emergency Reserve. • We have set up a separate dedicated team to progress an FMD response.

  29. China - Whey Protein Issue Food Safety • I am happy to say that the independent inquiry following the Whey Protein Concentrate concluded that New Zealand’s food safety regulatory system is equal to the best in the world. • The Government is committed to implementing all of the recommendations from the WPC Inquiry, many of which have cross-sector benefits, further strengthening our reputation for food safety and as a trusted supplier of safe food products. • MPI strives to maintain and enhance market access and align our regulation programme with international standards.

  30. Conclusion • In conclusion, MPI’s partnership with the different industry sectors is critical in enabling continued growth in the value of New Zealand’s exports.   • It would not be a surprise to you that a market-driven, joint approach, is also critical for all those involved with the export of products.

  31. Conclusion • Over the next 20 years, the global population will continue to surge and I believe the different New Zealand industries can play a key role in supplying high-quality food to the world. • MPI is committed to supporting you through opening up access to new markets, supporting innovation and growth, and partnering with you to enable your continued success.

  32. Lets look at the Cold Store sector

  33. We still have six teams in NZ run by Regional Technical Managers

  34. Specialist Advisor My position has direct accountability for: Its so specialised I cant tell you

  35. Standard of Stores keeps improving

  36. Standard of Stores keeps improving

  37. Perceptions have changed • What a premise looks like both from the exterior and interior counts • It may have nothing to do with food safety • A food premise or a premise that stores food needs to be clean and tidy

  38. We better be ready The EU are coming to audit our stores and our systems this year. They will be looking at – • C&S • R&M • inventory systems • traceability • labelling • EU Separation • records • certification

  39. We better be ready • For dairy we are changing over to electronic certification on the 1st September • This means auto approval

  40. RMP Stores in NZ MPI VS verified a total of 152 RMP registered cold and dry storage operators during the period 1st November 2013 and 30th April 2014. There are a total of 18 dairy only stores, 109 dual stores and 25 non-dairy animal product stores. From 1st November 2013 and 30th April 2014 VS undertook 469 verifications in this sector.

  41. Location of the store operators in relation to regions (152)

  42. CARs issued in the 2 yearly period from 30 April 2012 to 30th April 2014

  43. PBV percentage from period 5 through to period 12, (period 12 November 2013 to 30th April 2014 in comparison with the other sectors.

  44. Sector ceiling PBV steps

  45. Unacceptable PBV percentage

  46. PBV Step Why are only 73% of Stores are on their minimum compliance step? One reason is Dairy stores have now been included in this sector. Some are still working their way up to their Minimum PBV step. Another is companies not managing their own internal compliance – operator control – making sure labelling, inventory control, product ID, certification are correct

  47. Stores Performance Currently 73% of operators are on the Minimum PBV step available, ie step 7 (domestic) and step 6 (export) We need to make improvements in this area

  48. Five Main Issues – Ongoing • As stated = Improvements to work on • Repairs and Maintenance • Cleaning and sanitation • Labelling, Inventory, traceability, certification • Internal compliance (monitoring, daily, weekly checks) • Process management - records

  49. Strategy MPI are committed to and will continue to communicate and confirm strategy with the association and executive.

  50. Strategy • as the China issue showed we work together well • Communication plan • robust working relationship • current/relevant technical information • performance data • we see working with the association and executive as a key to this information sharing.