David Hadfield: Process Vegetables New Zealand Chair on Wattie's plan to axe the production of frozen vegetables

The impact of the Heinz Wattie's restructure won't be felt by growers straight away. 

The company plans to shut three manufacturing facilitates in Auckland, Christchurch, and Dunedin, and packing operations in Hastings. 

It's because of a planned move away from selling frozen vegetables, Gregg's Coffee, and several dips, which means 350 jobs are on the line. 

Process Vegetables New Zealand Chair David Hadfield told Ryan Bridge the current year's contracts have been locked in. 
 
He says harvests are either finished, halfway through, or about to start, so it will only effect growers next season. 

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Episode Transcript

Speaker 1 (00:00):
What happens to the vegie growers? What is looking to
act production of its frozen vegetables, plans to shut three facilities,
three hundred and fifty jobs on the line, High costs,
tough manufacturing environment to blame it. David Hadfield is chair
of Processed Vegetables New Zealand with me Live this morning. Morning,
David Morning, What happens to the contracts with growers?

Speaker 2 (00:21):
Oh, well, contracts are annual, so this current year's contracts.
Pea harvest has just finished, beans are underway, characters are
still to happen, So it'll be next season that it
will affect us because normally in May through the June
July the what he's reps are out around seeing growers

(00:46):
and signing up for the next season. But they will
have grown p seed for next season, so that's probably
sitting in a grain store at the stage unless that
let those guys no earlier than this, but I doubt
they would have because it would have got out if
bed had to happen.

Speaker 1 (01:06):
So what happens to that and what happens to the growers?

Speaker 2 (01:11):
The growers now are going to have to lock for
other crop options. Process peas and beans were a good
restorative crop and their rotation on an arable farm. So
now they'll be looking for other restorative crops to put
in its place. There will be some pea seed in

(01:35):
peace for the feed industry contracts around. But he's a
difficult decision for some growers because they rely on the
cash flow of the process crop, mainly because you paid.
It's a ninety to one hundred and ten day crop
and you're paid in the month after its harvesters and

(01:56):
you don't have to We didn't have to pay the
harvest cost that was covered at as part of the
wadi's contract.

Speaker 1 (02:03):
And a harvesting is obviously a lot more expensive now
the price of picture oil's going the way it is. David,
what happens? What can you give us an idea of
the financial impact for growers of this.

Speaker 2 (02:16):
Well, it's one crop and a rotation that pays around
what an average crop would be so and generally most
growers it's one peddic of peas or you know, a
pedica peace and a peddic of beans. So they'll replace

(02:37):
it with another crop. But it's most of the cash
flow implication more than they replacing the crop, right, and
a lot of crops. We don't get paid for months
after harvest. For as far as molling wheat, it could
be eighteen months after you've planted the crop before you're

(02:57):
actually getting paid the crops. It's short term three months
growing season and paid in month four.

Speaker 1 (03:08):
What's going on here? Is this? What's thing? Or we're
not eating beans and peas, we're.

Speaker 2 (03:14):
Not eating as much. New Zealand vegetable consumptions dropping. New
Zealand does need to eat more vegetables because it's a good,
healthy product. It's going to put a burden on the
health system if they don't eat more healthy, fresh and
frozen vegetables. But there is a lot of important product

(03:36):
coming in and that is affecting us.

Speaker 1 (03:39):
I was reading at the end of last year. There
were lots of stories around about this. Do you think
that's part of the problem here?

Speaker 2 (03:45):
It is, it's definitely part of the problem. Yeah. New Zealand.
We grow some of the best and highest yuring processed
crops in the world. But the cost of production, and
that's not only the fuel costs and fertilizer costs and

(04:07):
chemical costs, it's also the regular literary costs on us
to actually grow crops. Now it's quite prohibitive and quite
time consuming doing the paperwork.

Speaker 1 (04:21):
So what does that mean that we will grow less
of them?

Speaker 2 (04:26):
Yes, there's still New Zealand growing process crops going to
be available through McCain Foods and Hawks Bay and Telly's
an experton which I suggest that New Zealanders need to
hunt out the packaging and the supermarket look at where
it's growing, not where it's packaged, because quite often the

(04:49):
imported product is coming in in bulk and then packaged
in New Zealand. We need to look at actually where
it's growing.

Speaker 1 (04:55):
Roger and that David appreciates that. That's David Hadfield, their
Chair of Process Vegetables, New Zealand. For more from Early
Edition with Ryan Bridge, listen live to News Talks at
B from five am weekdays, or follow the podcast on
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