Rabobank visiting expert Dr David Hughes has warned New Zealand’s food industry that increasingly demanding consumers will be more careful when it comes to paying a premium for products.
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In his address, ‘Global Food Industry Developments’, Hughes said that New Zealand can no longer rely on being the lowest cost producer and consequently its food industry will have to adapt to the challenging global economy.
Changing consumer demand, market segmentation and rising fuel and food costs are all set to become major challenges for producers of premium products, whereby New Zealand in particular, “will need to quickly identify what people are prepared to pay a premium for and which segments are best to target”.
“As shoppers tighten their belts, they are now looking more carefully at premium food prices and questioning why they should pay more for a particular product. We know that they will pay more for a better tasting or healthier product, but they will not pay more simply for fancy packaging,” he said.
Now, Hughes suggested, is the right time to test markets for value-added products and to expand supply presence in international markets.
“I believe that this is an opportune moment to assess the market and develop sustainable strategies for the future,” he said.
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