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Bay of Plenty Region
Friday, February 26, 2021
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Kiwifruit to milk for Bay’s McBride

Zespri’s retiring chairman Peter McBride has made the step from one large primary producer to another with his election in November to the Fonterra board to fill one of three vacancies.

His election at the AGM sent a resounding message from farmer shareholders about their level of dissatisfaction with the previous board.

McBride’s appointment accompanied that of former director Leonie Guiney, who had been muzzled by Fonterra directors after missing out on being re-elected last year.

One director position remained unfilled as remaining candidates did not reach the required 50 percent level of support.

Tauranga-based McBride announced in October his decision to step down from his five-year chairmanship in February 2019.

He will be replaced by deputy chairman Bruce Cameron, a long-time kiwifruit grower who has been a director of Zespri since 2010.

We have demonstrated time and again the cohesiveness of our [kiwifruit]industry and our ability to act in its common interest.– Peter McBride

McBride’s departure from Zespri marks the end of a 17-year stint on the kiwifruit marketing group’s board, and he played an instrumental role in the industry’s re-establishment in the post-Psa environment.

Describing that period to Bay of Plenty Business News as the start of a “very long dark tunnel,” he and then-chief executive Lain Jager were able to convince growers to commit $25 million of their own cash to match the government dollar for dollar to get the industry back on its feet after the outbreak.

Eighteen months after the November 2010 outbreak, Jager and McBride presented bankers with a road map to financial recovery for the industry, with the Gold 3 kiwifruit variety being the centrepiece as an alternative more Psa-tolerant variety to the devastated Hort16a species.

“Really the risk was asymmetrical,” said McBride. “It was a far greater risk to do nothing, than to do what we presented, despite it being unproven.”

From that point the industry’s fortunes have taken an almost unbroken upswing.

Orchard gate returns have doubled, orchards are selling for $1.1 million per ha, and overseas markets are clamouring for a fruit variety more popular than the one it replaced.

But the Psa outbreak was closely followed by the Chinese importing scandal that resulted in a Zespri staff member being imprisoned in China, Zespri repaying thousands in forgone customs, and being subjected to a Serious Fraud Office inquiry in New Zealand over possible tax evasion. That investigation did not find evidence of such activity.

Zespri moved to become the “importer of record” for China, removing the rights from its China-based importer and taking complete control over the distribution chain.

McBride said the entire episode taught Zespri some valuable lessons, particularly about not compromising on values, and learning to send clear, sometimes blunt, messages to the market about the intention to retain those values.

Zespri has been committed to a “one company, one culture” philosophy, built on integrity in supplier-distributer relationships.

“Our kiwifruit industry has stepped through a number of challenges, but we have demonstrated time and again the cohesiveness of our industry and our ability to act in its common interest,” said McBride.

Dairying background

McBride’s move to Fonterra is one he is well-equipped to make. He began his career as a sharemilker with his wife Linda, before moving from South Waikato to Te Puke and converting a dairy unit to one of the country’s first Gold kiwifruit orchards in 1999.

He is also chief executive of Trinity Lands, a large dairying and orchard enterprise based largely in South Waikato.

In stepping up to his new role at Fonterra, McBride has acknowledged it is still early days for him to get under the hood of the country’s largest company.

However, he maintained the co-operative needed to have a better base understanding of what its key strategy is, and the reasons why it exists.

He noted how quickly the co-operative has dropped its “Velocity” and “Volume” components from its “3V” strategy launched by previous chief executive Theo Spierings.

McBride said one of his early tasks on the board would be to work on rebuilding farmer shareholder trust in Fonterra, which has been eroded over recent years.

 

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