· Process Vegetables NZ AGM & FAR Conference Thursday 29 and Friday 30 June 2017 Lincoln University, Canterbury P R O G R A M M E 2 Process Vegetables New Zealand

Process Vegetables New Zealand

AGM and Conference Papers29th – 30th June 2017 Lincoln University, Canterbury

2017

Contents

FAR Conference Programme

PVNZ Annual General Meeting Agenda

Draft Minutes of the PVNZ AGM held on 3 August 2016, Nelson

Chairman’s Annual Report 2017

PVNZ Income & Expenditure 1 April 2016 – 31 March 2017

PVNZ Draft Budget Forecast 2017 – 2018

PVNZ Board - Recommendation 1 (Commodity Levy Proposal)

Government Industry Agreement and Ministry for Primary Industries Biosecurity Update and Levy Proposal

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Process Vegetables NZ AGM & FAR Conference

Thursday 29 and Friday 30 June 2017 Lincoln University, Canterbury

P R O G R A M M E


Process Vegetables New Zealand Annual General Meeting

Venue: Room D6, Landscape Architecture Building Date: Thursday 29 June 2017

Time: 5:30pm – 6:30pm

AGENDA

5:30pm Process Vegetables New Zealand – AGM Welcome and

Introductions � Apologies, Proxies and Procedural Motions � Confirmation of 2016 PVNZ AGM Draft Minutes & Matters

Arising 5:35pm Chairman’s Annual Report 2017 - David Hadfield 5:40pm Financial Statements

(1) PVNZ Income & Expenditure – 2016 / 2017 (2) PVNZ Draft Budget Forecast – 2017 / 2018

5:50pm Confirmation of Election

� Directors � Chairman

6:00pm PVNZ Board – Recommendation 1

� Commodity Levy Proposal 2017 / 2018 6:10pm GIA and MPI Biosecurity Update and Levy Proposal 6:20pm General Business

� Matters from the Meeting 6:30pm Conclude the PVNZ 2017 Annual General Meeting 6:30pm Conference Dinner – Lincoln University Dining Hall


DRAFT Minutes of the Process Vegetables New Zealand AGM 2016 held at the Rutherford Hotel, Nelson Wednesday 3 August 2016 at 1:30pm

Present: David Hadfield (Chairman) Hugh Ritchie

Hamish Dodson Dean Davies Jim Sim Andrew Jones Bruce MacKay Norm Speers Tim Chrisp Sally Anderson Andrea Bournhill Mike Chapman Mike Smith

Other Attendees: John Seymour, Lynda Banks 1. Welcome and Introductions

The Chairman welcomed everyone to the Process Vegetables New Zealand 2016 Annual General Meeting. The Chairman thanked the following sponsors for without their effort and contribution it would not be possible to hold this event. Platinum - Plant & Food Research. Gold - United Fresh New Zealand; T&G Global Limited; Countdown Supermarkets. Silver - Rabobank New Zealand Ltd; Bronze - Drapenet Pty Ltd; Huhtamaki NZ Ltd; SGS; Viscount; Zespri; Maersk Line; Etec Crop Solutions; Primary ITO; Fruit Logistica; AsureQuality; Seminis and De Ruiter; Hill Laboratories; Vinea; MG Marketing. Support Sponsors - Horticentre; Aon; Agrichain Centre; Radfords Software; Waimea Nurseries; Info Power.

2. Apologies, Proxies and Procedural Matters

Apologies were received from: John Evans (PVNZ Board) Bruce Snowdon (Heinz Watties) H. Wensley Jackson (PVNZ Life Members) Jeff Wilson (PVNZ grower) Mike Flynn (McCains) Ron Prebble Julian Rain (Chairman HortNZ) Jan Lepoutre (PVNZ Board)

Hamish Dodson / Jim Sim

There were no Proxies or Bereavements.


3. 2015 Draft Minutes - PVNZ Annual General Meeting (pages 7 – 14 of the meeting papers) Amendments: Page 7 – replace Ron Dribble with Ron Prebble; Page 11 – replace Mid Canterbury presented by David Hadfield with Mid Canterbury presented by Jim Sim; Page 12 – replace Canterbury District presented by Jim Sim with Canterbury District presented by John Evans;

IT WAS RESOLVED with the above amendments made the 2015 Draft Minutes of the PVNZ Annual General Meeting held on 28 July were a true and correct record.

Dean Davies / Jim Sim There were no matters raised for discussion. 4. Chairman’s Annual Report – 2016 (pages 15 – 18 of the meeting papers) Key points:

� There will be a Great White Butterfly/GIA session tomorrow at 10:15am in the Waimea Room and attendees are encouraged to attend;

� The main focus this year has been on research, in particular the wrap up of the Carrot Project in its final year; completion of the Sweet Corn Toolkit update; the re-establishment of the PIDG Development Group, which met recently in Christchurch on 30 June; and Bean field walks held in Canterbury and Hawkes Bay;

� PVNZ have put a lot of time, money and effort into the VR&I Board this year; generic projects between the sectors are ongoing; projects of particular interest are in the RMA and Agrichemicals area;

� Farm environment plans and nutrient budgeting will have to be completed by everyone; Processor companies will bring in their own plans or join NZGAP;

� Finally, through the VR&I Board a PGP application is being lodged to the value of $9m, with a focus on non-chemical elements for crop protection;

5. PVNZ Annual Accounts – 2015/2016 Key Points:

Income: 1 Forecasted sales: for 2015/16 were $65m compared to an actual of $54m due to a mixed year

for weather extremes and yield volumes leaving a shortfall of $11m. 2 Total income: $356k was $76k higher than the budget forecast of $280k but this includes $109k

of research SFF funding income. When deducted a nett levy income of $247k is realised (compared to levy income only of $229k in the prior year 2014/15).

Expenses: 3 Research & Development: Expenses increased by $69k from $166k to $235k due to the review

of the “Growing a Brighter Future for Processed Carrots” research project and remodelling the project and timing which incurred a revised budget of $106k from 35k. The total funding for this project has been offset by the SFF contribution of $165k of which $109k was paid in the 2015/16 year

4 PG Meetings & Travel: Expenses were $58k and although $3k more than budget they were $12k

less than the prior year 2014/15.

Process Vegetables New Zealand2017 AGM & FAR Conference 5

5 Office & Communication: Expenses were down $12k from a budget of $97k to $85k, mostly due to the reduction in MAS (Market Access Solutionz) consultancy fees.

6 Total Expenses: $378k were $60k more than the forecast of $318k due to the increased R & D

expense. 7 Surplus / Deficit: A deficit balance of $22k was $16k less than the forecasted deficit of $38k. 8 Reserves: Decreased by $6k from $407k in 2014/15 to $309k in 2015/16.

IT WAS RESOLVED that the audited financial statements for the PVNZ accounts for the year ended 31 March 2016 be approved.

Hamish Dodson / Jim Sim IT WAS RESOLVED that BDO Wellington be appointed auditors for PVNZ for the year ended 31 March 2017 be approved.

Hamish Dodson / Dean Davies 6. PVNZ Budget Forecast 2016 / 2017 Key Points: Income:

1 Sales Value: The forecast is for the sales value to increase from $54m to $63m compared to the declined value declared this year

2 Levy & other Income: The PVNZ levy forecast of $344k for 2016/17 includes $79k of other

income. The nett Levy income is $265k and higher than the actual levy income of $234k for 2015/16.

Expenses: 3 Research & Development: Budget has decreased to $196k from $235k last year as the core cost

of the Carrot project was covered in 2015/16 but does include several proposed projects from the PVNZ Research Strategy.

4 PG Meetings & Travel: Expenses have been forecast higher at $61k compared to $58k due to

an anticipated higher attendance at the 2016 AGM & Conference. 5 Office & Communications: Expenses are $99k compared to the 2014/15 actual of $85,000. This

is due to a partial lift in the salaries and wages of support staff and the inclusion of MAS consultancy for GIA activities.

6 Total Expenses: Are forecast to be less by $22k compared to last year from $378k to $356k. 7 Surplus / Deficit: Despite a decrease in expenses there is also a decrease in Income and

therefore a deficit of - $12,000 is forecast which will be less than the actual deficit of $22k last year.

Note: Reserves will be at an estimated $378k.


Comments: On the limited levy we collect we cover a significant area of work in collaboration with other product groups, but our focus is always to get the best outcomes for the Process Vegetable Growers and our partners in producing the crop we sell. General: Discussion took place about the need to start discussing an increase in the current levy rate of .42% to .5%; if the industry wants to drive forward and achieve its strategies then these conversations need to start now with growers rather than waiting until the next Levy Referendum in 2018; between now and the next Levy Referendum a levy increase could be raised at an AGM; a robust reserves balance can only be used for GIA Readiness activities not Response activities; IT WAS RESOLVED that the PVNZ 2016/2017 budget be approved.

Hugh Ritchie / Andrew Jones 7. Confirmation of Elections Nominations were called for the position of Director of Process Vegetables New Zealand currently

held by:

� Jim Sim – Mid Canterbury; and � Hugh Ritchie – Hawkes Bay

As no other nominations were received it was declared that Jim Sim and Hugh Ritchie are duly re-

elected as Directors of Process Vegetables New Zealand. Nominations were called for the position of Chairman of Process Vegetables New Zealand currently

held by:

� David Hadfield

As no other nominations were received it was declared that David Hadfield is duly re-elected as Chairman of Process Vegetables New Zealand.

The Chairman left the meeting at 2:02pm. 8. General Business

a. PVNZ Chairman Honorarium Vegetable product group honorariums and daily fees were discussed recently at the Vegetable Chairs Forum and it was agreed to have uniformity across all vegetable product groups; The PVNZ honorarium ($16,000) and daily fees ($250/half day) are to remain unchanged; a recommendation to have the honorarium paid either quarterly or half yearly and paid in arrears was tabled;

IT WAS RESOLVED that the honorarium and daily fees remain unchanged and the honorarium be paid quarterly in arrears.

Jim Sim / Bruce MacKay The Chairman re-joined the meeting at 2:07pm.


b. Government Industry Agreements (GIA) � Background – PVNZ is not an incorporated society and for GIA purposes PVNZ will come

under the HortNZ umbrella for Deed and OA signing purposes; � PVNZ will have to indemnify HortNZ against any costs in relation to an incursion; � A paper has been prepared by Richard Palmer (Biosecurity Manager, HortNZ) and will be

discussed in more detail at the March 2017 PVNZ Board meeting; � Discussions have been held with FAR regarding signing an Operational Agreement together

and working with them as there is an overlap of crops and growers; � For further consideration and discussion is the setting of a biosecurity levy at a lower rate

with the aim of accumulating a biosecurity reserve of $50k for any incursion response activities;

� As an example Kiwifruit implemented a separate levy for biosecurity (completely separate to the commodity levy); it was set at the rate of 6% and used to help fund readiness costs and accumulate funds (to a maximum of $500,000) to meet the cost of an incursion; at the time of setting the levy order the Board was given the ability to immediately increase the levy from 0.6 to 1.0 cent should an incursion occur; this was legally possible to do through the levy structure; it took approximately 6 months to implement the biosecurity levy once mandate was achieved from growers;

c. Pea Weevil Incursion

� Pea weevil incursion occurred in Wairarapa in 2015; � Seed from seed stores and pea straw were freighted around NZ, including Canterbury and

Gisborne; � Once PVNZ became involved with MPI they pushed for a two-year ban which eventually

came into effect, and more recently all seed imports to be fumigated; � No further pea straw permitted to be moved out of Wairarapa and all pea straw already

removed will be purchased and destroyed; � Affected Wairarapa growers have been offered alternative crops to grow under normal

conditions/practices and then assessed against their last three year pea production, with proven evidence of yields, the difference is compensated;

d. Glyphosate

Background - Glyphosate (N-(phosphonomethyl) glycine) is a broad-spectrum systemic herbicide and crop desiccant. It is an organophosphorus compound, specifically a phosphonate. It is used to kill weeds, especially annual broadleaf weeds and grasses that compete with crops. It was discovered to be an herbicide by Monsanto chemist John E. Franz in 1970. Monsanto brought it to market in 1974 under the trade name Roundup, and Monsanto's last commercially relevant United States patent expired in 2000.

Farmers quickly adopted glyphosate, especially after Monsanto introduced glyphosate-

resistant Roundup Ready crops, enabling farmers to kill weeds without killing their crops. In 2007, glyphosate was the most used herbicide in the United States' agricultural sector and the second-most used in home and garden, government and industry, and commerce. By 2016 there was a 100-fold increase from the late 1970s in the frequency of applications and volumes of glyphosate-based herbicides (GBHs) applied, partly in response to the unprecedented global emergence and spread of glyphosate-resistant weeds.

Glyphosate is absorbed through foliage and minimally through roots and transported to

growing points. It inhibits a plant enzyme involved in the synthesis of three aromatic amino acids: tyrosine, tryptophan, and phenylalanine. Therefore, it is effective only on actively


growing plants and is not effective as a pre-emergence herbicide. An increasing number of crops have been genetically engineered to be tolerant of glyphosate (e.g. Roundup Ready soybean, the first Roundup Ready crop, also created by Monsanto) which allows farmers to use glyphosate as a post-emergence herbicide against weeds. The development of glyphosate resistance in weed species is emerging as a costly problem. While glyphosate and formulations such as Roundup have been approved by regulatory bodies worldwide, concerns about their effects on humans and the environment persist.

For more information - https://en.wikipedia.org/wiki/Glyphosate and

http://www.who.int/foodsafety/jmprsummary2016.pdf?ua=1 � Many sites around the world are banning Roundup; � Christchurch region has banned the use of Glyphosate in public areas; � A lot of emerging issues are related to the additives in Glyphosate;

Action Point: The use of Glyphosate and PVNZ’s involvement to be discussed at the next PVNZ Board meeting in March 2017.

e. Levies going forward � The meeting discussed the timing of when to communicate a commodity levy increase and

the implementing a biosecurity levy with growers; any commodity levy increase should coincide with promoting a clear and robust strategy;

� Maintaining a robust level of reserves was considered important in light of potential GIA liability;

f. PVNZ Website

� The PVNZ website has been developed with a focus on research project information; the website will be promoted to growers in the near future by post and email;

� Members only password access was discussed and it was decided it would be more problematic than useful, and as the science provider research information was already accessible to the public there was no need to include the members only password feature;

� To enhance information flow between product groups a link to the VNZI website will be included which includes the VR&I database of all VR&I product group vegetable research;

Congratulations to Hugh Ritchie on being elected to the Horticulture NZ Board. Hugh will retain

his position as a Director on the PVNZ Board.


DISTRICT REPORTS - 2016 Canterbury District – John Evans Peas - Nature threw everything it could at us yet again this year. There were crops damaged by a late frost giving low yields in some areas then we had others have a bad hail event in December which resulted in some lost crop. Then came the wet January and the cooler duller weather that had yields depressed across the board. The effect was that the total tonnage was back on forecast. There was no Bypass which shows Wattie’s managed the climatic vagaries well to minimise losses. The 4% bonus for Quality if your crop met the standards of low inclusions went well with 90% of loads meeting this standard. The outlook for this year is have maximum throughput at the factory and it is good to see the price remaining at the same level as last year. Broad Beans - Average to above yields due to the mild winter led to some bypass due to oversupply. Green Beans - Harvest finished in early April with variable yields ranging from 6t/ha to the low 20’s. Overall the volume met the target tones. The December rain and hail affected the emergence of some crops which has been reflected in the final yields. There was a crop field day with the objective of identifying production constraints in processing beans. The day was attended by a large proportion of growers at some stage. We saw a range of crops some being better than others and a good discussion was held as to the reasons for this. The main findings were get the rotation correct and produce a good seedbed and manage the irrigation well. Carrot Baby - The quality was good and the yields was on target. Dicing Carrots - Harvest is due to finish at the end of July the quality has been good but yields are back on target. Growers who get irrigation water from Barrhill Chertsey irrigation scheme have had 12 months under the Farm Environment Plan regime and have been through an Audit now. With most getting an A or B grade. Which was very pleasing. The experience has been stressful and expensive with the ongoing requirement for new planes and Overseer budgets annually. Hopefully there is chance to learn from this and streamline the process before 2017 when all of Canterbury growers will be covered by the process.


Mid Canterbury – James Sim Peas - In the spring peas were planted in excellent conditions resulting in perfect establishment. A smaller area than normal was planted and drilling commenced later, for factory management. Early peas were disappointing, however for the bulk of the season pea yields were exceptional with record results. Luck changed for very late drilled peas with disappointing outcomes for both growers and the processor, this coincided with very cold wet conditions in mid-January. A much larger area of peas is planned for the coming harvest. Sweet Corn - Planting began in mid-October, a little earlier than normal, the area was larger than last year but still quite small. At a presentation in the spring the 2015 top yield was revealed as 26 tonne / hectare which is a district record. Last February was the hottest month ever, the sweetcorn yields were good but didn’t achieve 2015 levels. The area for sweetcorn for the coming season is undecided. Overview - Growers with little or marginal irrigation and late sown crops have had an uncomfortable harvest, but farms that have invested in reliable irrigation, followed sound crop establishment, used best practice and have been lucky, will have achieved fantastic results this year over all crops. As normal some growers have been hit with isolated areas of frost and hail in the district. Gisborne – Dean Davis Three districts, three different results for this past harvest period and each one had its time leading the pack. Most growers agree that if this was a drought summer, can we have more please. Those that could, had their irrigation gear well serviced, ready to pounce when things got dry and the smiles were just as big when they were putting them back in the corner when not required. On the flip side, those growers without irrigation and have no hope of getting access to water in the foreseeable future [at least 5 years], had to take the risk it all approach and hope. End result, everyone pretty happy. Peas - Planting went mostly to plan, starting in the Gisborne area, then up to Tolaga Bay. Some paddocks were covered in water mid-September following heavy rain but recovered well. Also of note was the amount of leaf scorch noticed following post-emergence spray application, most noticeable in stressed areas, reminding growers how sensitive peas can be when growing. Some losses of yield occurred in the worst affected paddocks. Delays due to harvester breakdowns were minimal and TRs remained in control despite the heat. With Cedenco looking for more area this coming season, they realise that extra harvesting capacity is essential and are actively searching for another machine. Sweet Corn - All crops looked to have grown will despite dry periods and low topsoil moisture levels during Dec/Jan. Despite these conditions, late plantings established will and continued to grow without the need to irrigate. Once again only average yields were achieved [16/18 t/ha] for most of the harvest period, even with three different growing areas to benchmark against. Wairoa performing the worst due to been dryer than Gisborne / Tolaga Bay. GVB was a real problem in all districts, causing significant losses during the


March period, raising serious concerns as to a future without Methamidaphos for control and no suitable replacement coming on stream. Cedenco had serious concerns of oversupply of product without a market towards the end of March and took the steps to freeze it and hope approach and put as much as they could through powder. With hindsight been a wonderful thing, more IQF product for direct sale than they have would have been nice, go figure. Squash - Another good season, oversupply / above estimate crops causing paddocks to be delayed for harvest. Steady supply still coming out of Hawkes Bay direct from the field. Cedenco’s mechanical squash harvester, Mark 3, had a very successful run during April and into May, getting more effective with each incarnation and managing to achieve 120t picked raw product per day with only five people. Growers around our district are to face some serious issues in the near future and the local growers association will need to lead the charge on this. They need to highlight the seriousness of bio security on a local scale to ensure that any machinery, feed, stock or seed coming into the district is absolute clean of contamination. As we found out with BCM, failure to do so costs dollars and that cannot be allowed. On a brighter note, the Gisborne District Council has applied for resource consent to further investigate injecting water back into the Makaui aquifer. Only a handful of process growers draw water from underground so any immediate benefit from a positive outcome is still some way off. Hawkes Bay – Hugh Ritchie All in all the process season went well with consistent yields but no very high yields. The seasons weather was on the whole was easy to handle with just one period of heavy rain that effected some early pea crops and did require some replant. The Pea crop was spread between 81 growers planted over 3200 ha producing 17300t. Yields were above average and there was some very good production in the Manawatu. Of the total area 44% was irrigated. Production was significantly above expectation but a listeria problem in the international market resulted in this excess being used up as McCains was able to supply the gap left by the recall. There was some late season bypass when the heat finally came, compounding a cool start and crop delay with a start of harvest in the Manawatu. Corn season was also above average with season going well and the dry autumn made Harvest easy. However there was some bypass due to delays with bean harvest in the McCains crop. Beans was an average season some of the second crop area was later in the ground due to the slow early season on the peas. Heat stress on some of the Hastings crop did impact yield. 240ha yielded 3000t and again some bypass and lost crop due to weeds (ameranthis) this is an area that will need looking into as it is becoming a significant problem. Carrots resulted in an average crop, population work and bed configuration will be looked at to try and address yield in the different grades (dice and ring). Beetroot was average with no problems arising. Indications are that McCains will look to a slight lift in Peas, Beans and Corn area and carrot to remain the same. There will need to be some careful planning to try to avoid crop clashes and resulting bypass.


To conclude at the time of writing there were still questions around seed supply and risk around fumigation and protocols and the need to ensure we keep Peas weevil out of Hawkes Bay. I hope to update at the meeting. Marlborough – Hamish Dodson To date the growing season in Marlborough has seen mixed results for vegetable crops with yields being below average for some and exceptional for others. Rainfall for the months of Oct/Nov and Dec were well below the district average and temperatures well above. Since the New Year there has been significant rainfall events which have kept river levels up and meant water restrictions have not been enforced. Peas - Yields were what was expected for a lot of the peas, mainly due to a larger amount of dryland peas grown and the poor rainfall during the growing season. Corn - With harvest almost complete yields have been mixed with the average looking to have evened out over the season. Early corn was in general not great due to the soil being dry and germination low. Corn which benefited from being planted later into better seed bed conditions did above average at the tail end of the season. Beans - The main crop and baby beans have been the standout crop this season with yields nearly twice what we would usually suspect for the majority of paddocks. High yields attributed to the good, consistent rainfall in January. Spinach - Was a poor performer not because of population or early growth but due to the hot weather in spring which meant the crops bolted and went to seed in some areas. The 2016 Process Vegetables New Zealand Annual General Meeting closed at 2:45pm.

Dated this ___________________ day of _______________________ 2017

…………………………………………………. David Hadfield - Chairman



Chairman’s Annual Report 2017

The Process Vegetables NZ Board (PVNZ) has had a busy 2016/17 year including negotiations to develop the Government Industry Agreement (GIA) partnership process, the PVNZ R & D Board’s research project development programme and further integration with the V R & I (Vegetables Research & Innovation) Board including the NRE / RMA (Natural Resources & Environment / Resource Management Act) issues. The PVNZ Board has also been working closely and supporting NZGAP and the determining what impact new pieces of legislation that will be included in the NZGAP program will have on the process sector (Food Act etc). While the GIA and Biosecurity negotiations and issues have become considerably more time and management consuming. The Chair of the PVNZ Board has also continued to be active in the national Velvetleaf response, and Pea Weevil response in the Wairarapa. Both these incursions could have had very costly consequences for the process sector but now appear to be well contained and controlled although the final outcome for Pea Weevil will not be known until after the next summer season and before the end of the two year ban on pea growing in the Wairarapa. We have also been involved in the Brown Marmorated Stink Bug (BMSB) operational agreement planning and development. As mentioned above time consuming but necessary activities for all product groups.

GIA / Biosecurity (Government Industry Agreement)

PVNZ have decided to not become a legal entity and therefore cannot sign the GIA Deed in its own right. PVNZ has instead requested Horticulture NZ (HNZ) to represent them as a signatory to join the GIA, which they have elected to do as this will be beneficial for both PVNZ and HNZ. A Memorandum of Understanding (MoU) between both groups will be created as a joint document to partner with MPI. This document would outline for example: financial restraints, delegations for HNZ to make decisions, actions they can take in the event of a response, when to consult and general reporting programmes. The PVNZ Board can then consult with MPI on incursions and response options and then consult with growers before signing an Operational Agreement or if growers give that authority for the PVNZ Board the Board itself to confirm signing decisions.

Signing of the GIA Deed means the product group commits to the minimum commitments of attendance at GIA Deed Governance and biosecurity forums (HNZ’s role), to develop the sector profile and communicate with growers. This incurs minimal upfront costs but under the GIA partnership eliminates the PVNZ Members from being liable for 100% of the allocated cost for their affected crop share in the event of an incursion. The maximum would be 50% of 80% of the cost and in some cases will be as low as 30% of the 80% for industry.

In terms of the Biosecurity levy, PVNZ will pay for readiness activities from their existing levies paid by growers and responses activities from the biosecurity levy. A biosecurity levy of 0.2% equates to approximately $125k per annum, but the intent is to set it at 0% with a proposed maximum of 0.5%. Minor incursions will be covered from existing funding. The biosecurity levy will be activated if and when a biosecurity incursion occurs and the GIA partners will have already agreed to a predetermined cost share to control or eradicate the incursion pest or disease. To ensure there is rapid decision making process and response then prior pre-determined Operational Agreements will be agreed to between MPI and the Industry Product Group or Groups.

Processing companies would not pay any additional biosecurity levies but would pay levies as per any other grower on crops they grow in their own name. They will be an integral part of any response with the knowledge they have and the fact that the crops are contracted to them.


However in addition to this PVNZ also needs to prepare for the Readiness cost (of approximately $15,000 pa) PVNZ will be proposing at the 2017 AGM to pass a vote to increase the commodity levy to our current maximum of 0.5% from 0.42% as this increase will cover both extra research costs and the biosecurity readiness cost.

The extra costs to PVNZ are: (1) being part of the collective arable group and liaising with other product groups that have the same pests as us (2) the MPI readiness cost, and (3) implementing a GIA / biosecurity levy.

Communication with processor growers for this process and the levy structure will be by way of: Email, mail, the Grower magazine, and regional evening meetings coordinated with District Associations.

It was also considered more efficient to keep the Commodity Referendum Levy (CLR) and biosecurity / research levies separate.

PVNZ Research Projects and Proposals

Sweet Corn Toolkit (Completed) The Sweet Corn Toolkit and Ute Guide have been updated and distributed to all sweetcorn growers (process and fresh) with Vegetables NZ Inc. contributing funding to the printing and distribution of the updated Ute Guides and Manual information.

Optimising Sweet Corn Plant Population by Planting Date Combinations nationally This research project proposal has been initiated to understand the potential positive relationship between plant populations, early planting and late maturing cultivars and with how yield could be consistent across regions, (with the exception of frost affected crops in the Hawkes Bay). McCain’s have offered to complete a reasonably sized bulk in-house trial and Plant & Food Research (PFR) will assist with measurements and cross referencing support where required. Members of the PVNZ Board will do the trial work with the sweet corn calculator to validate the results.

Pea Project Proposal (PIDG) Irrigation, Soil Diseases and Partitioning Pea productivity issues were discussed at the last PVNZ R & D meeting and outcomes from that meeting focussed around four key components: irrigation, soil borne diseases, nutrients, their interactions and the to completing a literature review. The PVNZ Board agreed the next steps will be to focus on partitioning and the related science rather than a literature review. P&FR core funding for the project will be proposed and the project would also include international collaborations where the research will be the study of partitioning of the nutrient flow in the plant and the impacts of irrigation and weather patterns. We will be looking to continue our collaboration with the Arable sector on this work.

Bean Weed control and establishment Project Field walks were held in 2015 from which primary issues were identified and a proposal was written with intended funding from the SFF (the MPI / Sustainable Farming Fund). The SFF application was not successful so we have continued with two parts of the project and will look for alternative funding sources. The total proposed cost of the project is $150k per year over three years and co-funding would be from PVNZ, external funding organisations (e.g. AGMARDT) and in-kind contributions from growers. Over next 12 months, we intend to do more work around crop establishment, weed control, nutrient uptake, nutrient application, disease control and canopy management to increase bean productivity and the efficiency of bean production. The long-term aim is to produce a toolkit for grower like the one we have for sweet corn.


Sustainable Carrot Project The P&FR three year carrot project was completed in July 2016 with two key aspects came out of the project (1) nutrient practices; (2) and establishment with several good outcomes made in the nutrient area but there was not the same degree of progress in the establishment area. The guidelines that were a result of the project were developed from the scoping work completed but during the project there were also several ‘issues’ that occurred in terms of the trials and their applicability to all growers.

P&FR’s learnings were to focus on improved staffing resources, communications to growers and secondly to gain a better understanding for the management and resourcing of Extension programmes i.e. as to who is ultimately responsible for getting out in the field talking with growers and distributing written material such as the NZ Grower magazine. Also the PVNZ project team owns the project and all projects especially if SFF funded, will have a structured critical path included in the original proposal.

New Carrot Project Proposal - Crop establishment PVNZ have proposed a new carrot crop establishment project that will analyse: seed quality; soil type; sowing depth; soil moisture content including fertiliser management protocol and irrigation management that will lead to a better understanding of how more reliable yield increases can be achieved.

PVNZ Research and the V R & I Board

The PVNZ are partners and funders of the V R & I board (a collective board of vegetable product groups) who collectively fund and manage multiple vegetable based projects. Key investment are allocated to portfolios that will provide very detailed and beneficial information to growers for: Environment and nutrients management ($596,235); Agrichemical management ($96,600); Biosecurity protection ($106,420); Food safety including water use and disposal ($40,000). The PVNZ group are contributing $46,000 towards these projects, which have a total value or $843,000 for the 2017/18 financial year.

The V R & I Board have also identified bio-security support as a key area of collective investment to support the continuation of the “Monitoring of Biosecurity Risks” program and a 3-year continuation of this programme has been approved by the Board.

An $8m plus project has been proposed for a PGP funding grant for the “Better sustainable Pest and Disease Management for Horticulture” project that targets three main objectives relating to the use of agrichemicals, including: resistance management, new technologies and developing a better regulatory system for minor crop registrations. The proposal has been drafted for submission and NZIER have been engaged to undertake an economic assessment as a pilot project to the main project. His project involves nearly all the horticultural product groups and The Foundation for Arable Research (FAR).

Bio-security update

Pea Weevil As you will be aware the Pea weevil incursion was confirmed in early April 2016 and an MPI eradication programme commenced in place for the Wairarapa region assessing infested properties and restricting the movement of any pea related product or plants in the entire region. PVNZ has been closely supporting MPI and growers through the 2 year pea growing ban and some of the key findings from that management have been:

� The costs and practicality of fumigating pea straw was poor, therefore all pea straw was destroyed

� The destruction of straw that left the region before the Ban was issued and has since been destroyed where practical

� MPI are not recommending preventative spraying outside the region � Under the Biosecurity Act growers haven’t been able to claim because crops were not destroyed

prior to the Ban but compensation for the next two years on the profit margin difference of the


pea crop compared to the replacement crop is covered by an ex gratia payment under the Finance Act

� MPI’s is confident the eradication programme will be successful, providing the weevil is not found outside the zoned area

� The weevil is host specific and not likely to transfer to other seeds in seed stores � Planting of trap crops will start soon and these pea crops will lure weevils to them and the plants

will then be sprayed with insecticide and destroyed

Finally

On behalf of the PVNZ Board I would like to thank our growers who have provided various “in-kind” support and also the staff at Horticulture NZ for their assistance on issues that impact on our process crops and also their support for the PVNZ Board and growers during 2016/17.

…………………………

David Hadfield Chairman – Process Vegetable New Zealand


PVNZ – Income & Expenditure 1 April 2016 to 31 March 2017

Please Note: The PVNZ 2016/17 Income and Expenditure are the Final Financial Accounts but are still subject to audit by BDO. This is due to the earlier timing of the PVNZ AGM and FAR Conference.

PVNZ’s financial performance for the year ending 31 March 2017 – refer page 19:

Key Points:

Income:

Forecasted gate sales value: for 2016/17 was $63m compared to an actual of $62m.

Total levy income: Actual levy was $261k and $4k lower than the budget forecast of $265k. This excludes other income of $66k of external funding from the Sustainable Farming Fund (MPI / SFF) and $7,378 in allocated interest (TBC). Total income for PVNZ was $335,207 compared to a forecasted $344,000 a shortfall of $8,793

Expenses:

Research & Development: Expenses were $188k and $8k below the forecasted $196k. The funding for the “Carrot Project” project has been offset by the final SFF contribution of $66,367.

PG Meetings & Travel: Expenses were $82k and $21k higher than the forecasted budget of $61k due to increase PVNZ, R & D and GIA meetings. Also due to the Nelson location for the 2016 AGM and Conference the event cost $6k more than the $15k budgeted.

Office & Communication: Expenses were down $7k from a budget of $99k down to $92k, mostly due to the reduction in MAS (Market Access Solutionz) consultancy fees.

Total Expenses: Were $363k and $7k more than the forecast of $318k due to the increase in Meetings & travel.

Surplus / Deficit: A final deficit balance of $28k was $16k higher than the forecasted deficit of $12k.

Reserves: Decreased by $16k from $390,648 to a forecasted $374,648.


2016 / 2017 Actual 2016 / 2017 Forecast

Actual sales $62m Forecast sales $63m

EST $ Levy & Other Income $145,785 Levy Product Group (0.22% ) 139,000115,677 Levy R & D (0.20% ) 126,000

7,378 Interest 6,00066,367 Other Income (External Research funding) 73,000

$335,207 $344,000

$ Research & Development $30,299 V R & I Project Provison (10% of R & D levy) 18,000

9,862 V R & I Manager & Admin 13,000147,152 R & D projects & new proposals 155,000

1,212 Projects (GIA. EPA, RMA, etc) 10,000$188,525 $196,000

PG Meetings & travel Expenditure21,526 AGM & Conference 15,00016,709 Honoraria & Exec travel 16,00044,361 Product Group Meetings Travel & Fees 30,000

$82,596 $61,000Office & communications

668 Consultancy / MAS 5,00023,024 Office Overheads 23,000

151 Postage 50012,000 NZ Grower magazine Contribution 13,000

202 Printing, stationery 2,5002,100 Capitation & DA Grants 2,5002,419 General Expenses 1,0001,406 Photocopying 1,000

49,254 Salaries & Wages (Office staff allocation) 49,0001,056 Telephone & Tolls 1,500

$92,280 $99,000

$363,401 $356,000-$28,194 Surplus / Deficit -$12,000$223,903 General Reserves$166,745 R & D Reserves$390,648 Total Reserves Est $374,648

Process Vegetables NZIncome and expenditure Forecast 1 April 2016 - 31 March 2017

FINAL


PVNZ - Budget Forecast 1 April 2017 to 31 March 2018

Key Points - refer to page 21:

Income:

Sales Value: The forecast is for the sales value to marginally decrease from $62m of actual sales to $60m.

Levy & other Income: The PVNZ levy (based on 0.42% levy) forecast at $257k but excludes other income other than Interest of $5,000. Last year’s 2016/17 actual nett Levy excluding other income was $261K.

Expenses:

Research & Development: Budget has increased from $188k last year to $226k this year to include additional new projects proposed in the PVNZ Research Strategy.

GIA / Biosecurity: With GIA now being legislated and implemented the PVNZ Board have budgeted $42,000 for: Biosecurity readiness costs (a mandatory fund), provision for the PG’s cost share of a possible incursion or incursions and the development of a PVNZ/GIA Operational Agreement

PG Meetings & Travel: Expenses have been forecast at $61k with an anticipated reduction in PVNZ meeting numbers and combining the PVNZ AGM with FAR’s 2017 Conference.

Office & Communications: Expenses are $102k compared to the 2016/17 actual of $92k.due to the funding of the new PVNZ website and potential increased activities for MAS consultancy on GIA activities.

Total Expenses: Are forecast to be higher by $68k with the $38k of additional R & D spend and $42k for GIA related work.

Surplus / Deficit: is forecast to be higher at $174k which will be funded from the PVNZ Reserves until the proposed 0.8% levy is initiated.

David Hadfield Chairman – Process Vegetables NZ

John Seymour Business Manager – Process Vegetables NZ

29 June 2017


2016 / 2017 Actual 2017 / 2018 Forecast

2017 / 2018 Forecast

Actual Sales F/cast sales $60m @ 0.42%

F/cast sales $60m @ 0.5%

Est $ Levy & Other Income $ $145,785 Levy Product Group (0.22% ) 132,000 132,000115,677 Levy R & D (0.20% or 0.3% or 0.6% ) 120,000 180,000

7,378 Interest 5,000 5,00066,367 Other Income (SFF Research funding)

$335,207 $257,000 $317,000$ Research & Development $ $

30,299 V R & I Projects 11,000 11,0009,862 V R & I Manager & Admin -10% of Levy 10,000 15,000

0 R & D Project proposal management 30,000 30,000147,152 R & D projects & new proposals 160,000 160,000

1,212 Projects (EPA, RMA, etc) 15,000 15,000$188,525 $226,000 $231,000

GIA / Biosecurity0 GIA Deed, OA Admin 17,000 17,000 0 GIA Incursion / Response 10,000 10,000 0 GIA Readiness 15,000 15,000

$0 $42,000 $42,000

PG Meetings & travel Expenditure21,526 PVNZ AGM / FAR & Conference 15,000 15,00016,709 Chair Honoraria 16,000 16,00044,361 PG Meetings Travel & Fees 30,000 30,000

$82,596 $61,000 $61,000

Office & communications668 Consultancy / MAS 5,000 5,000

23,024 Office Overheads 23,000 23,000151 Postage 500 500

12,000 NZ Grower magazine Contribution 13,000 13,000202 Printing, stationery 2,500 2,500

2,100 Capitation & DA Grants 2,500 2,5002,419 General Expenses 1,000 1,0001,406 Photocopying 1,000 1,000

49,254 Salaries & Wages & Office staff 49,000 49,0001,056 Telephone & Tolls 1,500 1,500

$0 Website development 3,210 3,210$92,280 $102,210 $102,210

$363,401 Total Expenses $431,210 $436,210-$28,194 Surplus / Deficit -$174,210 -$119,210$223,903 General Reserves$166,745 R & D Reserves$390,648 Total Reserves Est $235,000 Est $291,000

Process Vegetables NZIncome / expenditure Forecast 1 April 2017 - 31 March 2018

FINAL DRAFT


PVNZ Board Recommendation 1

The PVNZ Board propose the following Recommendation:

Recommendation 1: That the Process Vegetables NZ Commodity Levy be increased

from 0.42% to the agreed maximum rate of 0.50% effective from

1st September 2017.

This increase is recommended to meet the additional costs of

proposed R&D Projects and Government Industry Agreement

(GIA) Biosecurity Readiness costs.

Explanation: In the September 2012 Commodity Levy Referendum PVNZ

grower members were asked to vote on the proposed Process

Vegetables NZ Commodity Levy of 0.42% (42 cents per $100 of

sales) with a maximum rate of 0.50% (50 cents per $100 of sales)

collected at the first point of sale by the processors.

The 2012 Commodity Levy Referendum proposal was passed in

September 2012 with 95% of respondents, by sector value, in

support of this Commodity Levy amendment.


GIA and MPI Biosecurity Update and Levy Proposal “Should Process Vegetables New Zealand join the Government Industry Agreement for biosecurity readiness and response?” Biosecurity continues to be identified as the number one issue for growers; in Horticulture NZ surveys, and again in the KPMG Agenda in 2016. In late 2016 Ministry for Primary Industries (MPI) launched the new biosecurity strategy Biosecurity 2025 with significant expectation on, and opportunity for, Government Industry Agreement for Biosecurity Readiness and Response partners to lead, govern and shape the biosecurity system. This represents a significant change in approach to one of: key stakeholders integrating, investing, and acting collectively to achieve the best possible biosecurity outcome for New Zealand growers. It is now time for Process Vegetables New Zealand to become GIA signatory and partner as we have been talking to growers for several years and at the last AGM a vote confirmed the commitment to progress the mandate process. The Biosecurity Act 1993 was amended in 2012 to enable government and industry to work together in partnership through GIA. By December 2016 fourteen industry partners had signed the GIA Deed including Kiwifruit Vine Health, Pip fruit NZ, NZ Avocados, Citrus NZ, Tomatoes NZ, Onions NZ, Vegetables NZ, and Potatoes NZ. Many of these parties also signed up to the Fruit Fly Operational Agreement in May 2016. The Process Vegetables New Zealand Board has reviewed and assessed the options for process growers and strongly believe that it is in the best interests of all to become a partner in GIA. For that to happen PVNZ is seeking mandate for Horticulture New Zealand to be the signatory on behalf of process vegetable growers. A Memorandum of Understanding will clarify the roles, responsibilities and costs for each organisation

Key points The Government Industry Agreement (GIA) is a new way of joint decision-making and cost sharing between industry and the government to improve New Zealand’s biosecurity readiness and response. If Horticulture NZ signs the GIA Deed on behalf of Process Vegetables New Zealand, PVNZ is able to make decisions with government and other incursion affected product groups on deciding:

• Which biosecurity responses our industry will participate in; • How biosecurity readiness work should be prioritised; • What share of readiness and response costs we are prepared to pay;

If PVNZ do not join, there is no say in decision-making and it will be left to others to decide New Zealand’s biosecurity priorities, and how much PVNZ must pay to be a part of various initiatives including responses where PVNZ are beneficiaries. If members decide that PVNZ should join GIA then:

• Process Vegetables New Zealand will meet biosecurity readiness activity costs from the existing levies paid by growers.

• The establishment and implementing of a Biosecurity Levy from members to enable PVNZ to meet the costs required for any incursion response activity. PVNZ will be able to spread the cost of any response over several years.


• Process Vegetables New Zealand will pay their industry’s share of biosecurity response costs from a combination of reserves and/or lending mechanisms (including, and most probably, from Crown Loans). The scale of any response will dictate the selection of best options.

• The proposed Biosecurity Levy of a maximum 0.50% would initially be set at zero, and remain at zero until such time as funding for a biosecurity response was needed.

Proposal

� Later in 2017 PVNZ will be seeking mandate from process growers for:

1. Horticulture NZ to be appointed signatory for GIA purposes on behalf of Process Vegetables New Zealand.

2. PVNZ to establish and implement a Biosecurity Levy at the maximum rate of 0.50%, commencing at zero and remaining at zero until such time as when funding is required to meet GIA response activity costs from an incursion that impacts specifically on process crop/s.



AGM and Conference Papers29th – 30th June 2017 Lincoln University, Canterbury

2017

Documents

· Process Vegetables NZ AGM & FAR Conference Thursday 29 and Friday 30 June 2017 Lincoln University, Canterbury P R O G R A M M E 2 Process Vegetables New Zealand