I think if you look at populations as a whole most people will just buy the cheapest thing on the shelf. But I am not talking about "most people", there is a significant minority of people who pay for premium products and that's the market I think we should have targeted. We can't compete in the "cheapest price" market.

[–] tirohia 1 points 1 year ago (1 children)

I think the point of it (or one of the points) was that that market of of people who would pay a premium, was way, way smaller than everyone used to think it was.

Self reporting - essentially asking people if they would pay a premium, enough people always replied that they would, to make it seem as if there was a sizeable global market that would pay the premium.

If I recall correctly, wihen push came to shove at the till though, their work suggested that that global market, was tiny.

[–] [email protected] 0 points 1 year ago (1 children)

I think the point of it (or one of the points) was that that market of of people who would pay a premium, was way, way smaller than everyone used to think it was.

Let's say it's small. Let's say it's five percent. The five percent of America and Europe and China that is willing to pay more could completely gobble up everything we sell and still need more. Companies like Porche, Lexus, Luis Vitton etc make a shit ton of money catering to a tiny percent of the population.

Because we chose not to enter into that market we are not tiny fish in a giant ocean fighting for the crumbs that fall through the cracks.

Like I said. We suck at capitalism and chose to enter into an arena with the biggest, most trained, most roided up fighters wearing our boxer shorts and boxing gloves we bought at k-mart. No wonder we are having so much trouble.

[–] tirohia 1 points 1 year ago (1 children)

While Porsche might make a shit-tonne of money from a eye-watering markups to appeal to people with more money that taste, their costs are spectacularly high, and they employ large amounts of highly competent engineers (the car companies at least, I doubt Louis Vuitton does) and marketers to make a premium product. Advertising the production of our agricultural sector as non-GMO was never going to turn in into a premium product. My assumption is that our produce is looked up favorably in foreign markets, as good, but not necessarily premium. Some of it is marketed as premium, but trying to upscale our entire agricultural sector to that level would I suspect, fail magnificently. You can bring together the people needed to do something like that at a company level, but at a country level - I just don't think there's a sufficient number of highly competent people to be able to do that.

And we wouldn't have been the only ones appealing to that market. Gambling the entire agricultural sector on being able to dominate that tiny sector would be incredibly dangerous.

I don't disagree that we're awful at capitalism though.

My current pick for illustrating that would be Fonterra - it's my understanding that the vast majority of Fonterra's exports are milk powder bound for a spectacularly large range of industrial uses. Overseas, there are companies slowly ramping up the production of milk grown in vats using GE yeast. Produces milk powder with a fraction of the resources a dairy farm, with a fraction of the environmental costs. Companies who use milk powder as part of an industrial process don't care whether it came from a vat full of yeast or a lovely open air dairy farm. And as best I can tell, Fonterra doesn't think this is likely to cause any problems. Fonterra could try and move all of that production to premium produce for the consumer, but if that market existed, I would have thought they would have already done it. I don't think the problem here is that they are selling to the wrong sector or not marketing their produce as well as they could - I think it's that we produce too much milk. We pile all of our eggs in one basket and then insist that that's not a potential problem.

[–] [email protected] 0 points 1 year ago (1 children)

Advertising the production of our agricultural sector as non-GMO was never going to turn in into a premium product

this is where you are wrong. Right now in the USA and Europe there are no labeling laws so the consumer can't be sure they are getting a GMO free product. If the entire country was GMO free the people who want non GMO products would gladly pay much more for NZ made products because they would know it's "pure".

And we wouldn’t have been the only ones appealing to that market. Gambling the entire agricultural sector on being able to dominate that tiny sector would be incredibly dangerous.

No other country would be GMO free so we would be the only ones and we already gamble our entire economy on just avocados, kiwifruit and milk. We saw what just one little disease did to the kiwifruit industry and our economy.

My current pick for illustrating that would be Fonterra - it’s my understanding that the vast majority of Fonterra’s exports are milk powder bound for a spectacularly large range of industrial uses.

yes and competing with Canada and the USA for the lowest price while doing it. It's a terrible strategy.

Overseas, there are companies slowly ramping up the production of milk grown in vats using GE yeast.

Are they? Which countries? What's the brand of milk? How much of it is being sold? I haven't heard of anybody selling yeast milk so this sounds like a folk tale to me.

Fonterra could try and move all of that production to premium produce for the consumer, but if that market existed, I would have thought they would have already done it.

they can't. There is nothing differentiating fonterra milk powder from any other milk powder. They should have concentrated on value add products like cheese and such but as I said we suck at capitalism in this country.

[–] tirohia 1 points 1 year ago (1 children)

We might have been the only country. There would have been a tonne of other companies not from New Zealand competing in that market though. I odn't think we're going to agree on that though so ... moving on.

There being nothing differentiating Fonterra milk powder from any other milk powder is entirely my point - if they could have moved their production to premium markets, they would have. They haven't, which suggests to me that they can't. So at least we agree on that :)

The milk in a vat thing, it's been around in some fairly primitive forms for several years, it's been very interesting watching it develop.

https://phys.org/news/2021-01-yeast-cow.html

https://www.theguardian.com/food/2022/sep/18/leading-the-whey-the-synthetic-milk-startups-shaking-up-the-dairy-industry

https://www.washingtonpost.com/business/2023/03/12/precision-cultivated-dairy/

https://www.abc.net.au/news/2022-08-30/synthetic-milk-made-without-cows-may-be-coming-to-supermarket/101383770

There's a bunch of companies - Perfect Day and New Culture in the US, Legendairy Foods in Germany. Remilk in Israel. If there's not someone, somewhere in amongst all that planning on ramping up produce milk powder for industrial uses, I'd be very surprised. As I say, companies who use milk powder in their industrial processes, literally do not care if it comes from a vat or a cow. Short term not so much. Long term, I don't see how this doesn't screw Fonterra if they carry on as if it was nothing.

[–] [email protected] 0 points 1 year ago (1 children)

We might have been the only country. There would have been a tonne of other companies not from New Zealand competing in that market though.

How so? How many other countries were even thinking about being GMO free?

There being nothing differentiating Fonterra milk powder from any other milk powder is entirely my point - if they could have moved their production to premium markets, they would have.

That makes no sense. Their entire business is to control the milk market in NZ. How could they move their production to another country? Are they going to ship liquid milk elsewhere and then turn it into powder there?

The milk in a vat thing, it’s been around in some fairly primitive forms for several years, it’s been very interesting watching it develop.

I know, I know. Any day now it's going to happen.

As I say, companies who use milk powder in their industrial processes, literally do not care if it comes from a vat or a cow.

What percent of the milk consumption in the world is for industrial processes?

I don’t see how this doesn’t screw Fonterra if they carry on as if it was nothing.

maybe they don't care about the 0.001% of the milk market this doesn't give a shit about how milk tastes or makes cheese or yogurt or whatever.

[–] tirohia 1 points 1 year ago

You don't have to be a country to sell GMO free produce.

By market, I meant the market for a product, not a physical place - the market for milk powder vs the market for premium ice cream for example.

I wouldn't say any day, but it will happen. Fonterra ignoring it demonstrates a lack of foresight - illustrating one of the reasons we're bad at capitalism.

Don't know the percentage of the top of my head, but milk powder (or casein derived from milk powder) is used in paints, paper manufacturing, textiles, it's used a an ingredient for a whole bunch of things in labs, packaging, an additive to some plastics, in some places an additive to concrete, it's used in cosmetics. Whey is used to produce industrial alcohol (Fonterra used to make this, don't know if they still do). It's got a lot of non-food related uses.

And even in the food industry, corporations like Nestle aren't going to care where it comes from when they're using it to adjust fat or protein content in the vast majority of their foods.