This book on NZ Industries is quite old now, but it caught my eye because I’m trying to research food science, with a focus on New Zealand food/science.
An aside: New Zealand literature and refrigerated shipping
It also caught my eye because of what Kate De Goldi wrote in her introduction of the recent republication of Sydney Bridge Upside Down….”New Zealand literature began in 1882 with the introduction of refrigerated shipping. This was the inimitable opening line of the New Zealand lit course offered at Canterbury University in 1981. It was delivered by Dr Patrick Evans…. Refrigerated shipping – the vehicle for the frozen meat trade – entrenched the basis of the nascent New Zealand economy: the farming and slaughter of animals. The consequent despoliation and industrialisation of the landscape, and the transformation of the New Zealand colonist into ‘a systematic and calculating’ butcher, described the progress of the ‘New Zealand dream’ from an imagined South Pacific Eden (a ‘better Britain’) to a fallen society with, literally, blood on its collective hands.” (p.vii, Kate De Goldi Introduction: Sydney Bridge Redux, pp.vii-xiii)
(This is also why I am interested in Gordon McLauchlan’s The Saltwater Highway: the story of ports and shipping in New Zealand).
New Zealand industries
Anyway, back to the book I was talking about (Pickford and Bollard’s Structure and Dynamics of New Zealand Industries)… (Note it was published in 1998)
The book is divided into 10 chapters “devoted to in-depth but not overly technical case studies of the following industries: red meat, fishing, dairy processing, brewing, sugar refining, freight transport, telecommunications, banking, hospitals and tourism. These industries (and some may dispute that ‘hospitals’ and ‘tourism’ constitute industries!) were chosen,” Pickford and Bollard explain, “on several grounds: their size and importance to the new Zealand economy; differences between them in mode of operation and type of output; the range of interesting economic and business issues which they illustrate; and the availability of industry experts to prepare the chapters. The editors are aware that these industries do not span the whole economy; nonetheless, taken together, the coverage provides a unique window into New Zealand industrial life.
The industry case studies present a wide range of experiences with respect to history, regulation, and underlying production technology; to market structure, firm behaviour, and international competitiveness; and to performance outcomes in terms of efficiency, costs and profitability. They cover activities at each of [-p.8] the major stages of production: primary (e.g., red meat, fishing), secondary (e.g., brewing, sugar refining) and tertiary (e.g., banking, tourism). Within those stages are to be found a huge variety of productive enterprises, ranging from the privately-owned sole trader (e.g., in road freight transport) to large publicly-listed companies (e.g., in telecommunications and air transport), and from co-operatives (e.g., in dairy processing) to state-owned enterprises (e.g., in hospitals). What emerges is a kaleidoscopic pattern of business endeavour which, nonetheless, shares common roots in the development of a small, isolated nation in the south-west Pacific.” (pp.7-8, Introduction, Alan Bollard and Michael Pickford, pp.7-24)
Historical Development of New Zealand Industry
“Early European contact in New Zealand set a pattern which underscored industrial development in the years to follow. Early ventures were based on the extraction of raw natural resources with minimal processing, such as whaling, sealing, timber felling, flax collection, gold panning, kauri gum digging and fungus collection. Gradually, these basic extractive activities were complemented by limited further processing as labour skills, venture capital and equipment became available, and this evolved into farm-based production as the preservation of perishable animal-based products and transport technology improved. Foremost amongst these was the invention of refrigeration technology in the 1880s. By the end of the nineteenth century, large volumes of dairy products, meat and wool were being exported, mainly to Great Britain. Shortages in Europe during the two World Wars reinforced this emphasis on food and primary materials production, while world recessions – especially the Great Depression of the 1930s – showed how vulnerable the economy was to fluctuations on volatile world markets for primary products.
Developing in parallel to exporting was the process of import substitution or production for the domestic market. In the nineteenth century, self-sufficiency was a matter of survival. Industries were initially craft-based. However, as the population grew, and as local geographic markets were linked by an improving transport network into regional markets and then a national market, production moved to small factories to meet the increasing demand and to gain rudimentary economies of scale. Local production waxed and waned, pushed by the conflicting forces of grwoing domestic demand and growing local expertise and supply, in the broader context of the business cycle.” (p.8)
“The need to finance early infrastructure (e.g., the railways) when the capital market was in its infancy and unwilling to support risky, major ventures, and a fear that market power might be exploited by firms in concentrated markets (e.g., in banking), led to a distrust of unfettered market forces. Public ownership [-p.9] was seen as the appropriate response to these pressures and concerns in many industries, for example, in banking, telecommunications, railways and, later, airlines, which brought with it widespread government regulation to limit market responses.
The propensity to regulate received further momentum at various times. In response to the 1930s Depression, the government in 1938 introduced import licensing to encourage industrial self-sufficiency so as to reduce the economy’s reliance on volatile overseas markets. A further attempt to widen the industrial base occurred in the late 1950s, when protective tariffs and other subsidies were used to induce overseas companies to set up production in New Zealand. Such measures were seen also as a way of addressing the perennial balance of payments problem.
By the 1970s, volatile commodity markets, uncompetitive local industrial production and a growing demand for social spending had created a growing structural problem in the economy. The economy was not well placed to withstand the loss of markets accompanying the United Kingdom’s entry into the European Community in 1973, nor the international recessions caused by the OPEC-induced oil crises of 1973-74 and 1979-80. The result was burgeoning inflation and balance of payment problems, followed later by rising unemployment. The government responded with expensive ‘Think Big’ projects designed to reduce the economy’s dependence upon imported oil, and also added to agricultural subsidies to increase production and protect farm income.
By the mid-1980s the pressure for reform could no longer be resisted. In 1984 the new Labour government embarked upon radical reform of industry and the wider economy, which was continued at a slower pace by succeeding governments. The reform process was designed to free the market system from government regulation wherever possible. Included were major deregulations in the finance, transport and energy sectors; reform of the labour market; the abolition of agricultural subsidies; large reductions in import protection; the removal of product-specific price controls and quantity licensing; the termination of state-regulated monopoly rights; the introduction of new light-handed business rules for competition policy and utility regulation; the removal of controls on the flow of international capital; a comprehensive overhaul of the public sector; and innovative changes in the implementation of monetary and fiscal policies. The reform programme in New Zealand has been characterised as a pursuit of economic efficiency.” (pp.8-9)
“The speed, size and sequencing of these reforms pushed New Zealand industry, and the economy at large, into a restructuring recession from 1986 to [-p.10] 1991, in which many manufacturers gave up domestic operations or went out of business entirely. Almost all were forced into new management strategies, operational cuts and labour reductions, and corporate restructuring. government investment programmes dropped to very low levels, and the newly corporatised State Owned Enterprises, under pressure to become profitable, cut costs by massive reductions in their labour forces. The reforms left slimmed-down enterprises across almost all industries and sectors, together with substantial unemployment in the economy. However, in the early 1990s, the economy at last began to grow again, especially in manufacturing exports, demonstrating the sector’s improved international competitiveness, while corporatised and privatised government trading enterprises began to return profits from fastly more efficient operations.
Today, New Zealand industry is, with a few exceptions, conducted on a very small scale by the standards of OECD countries. This partly reflects the small size of the domestic market and partly the struggle for economies of scale. In addition, the reforms of the 1980s appear to have led to a resurgence of smaller firms able to respond faster and to operate in a leaner way. From the experience of operating in relatively unregulated markets, with low or minimal levels of government assistance, firms in general are highly responsive to market signals. Ownership also changed in the 1980s with many management buy-outs, substantial acquisitions and restructurings in many industries, some increase in foreign investment, and a growth in publicly-listed companies. However, the farming and small retail sectors remain almost entirely dominated by traditional, family-owned businesses. A relatively large number of firms now have contact with the international trading environment, despite the fact that exporting often involves operating in far-off foreign markets, and that many lack the resources to operate effectively in such markets.” (9-10)
“In 1846 the British government repealed the Corn Laws, thereby opeing the British market to imports of food on a scale which had not been allowed for four hundred years. Production of New Zealand’s meat and dairy products gained no immediate advantage, for although they could be produced cheaply, they could not be stored for the long voyage to England.
However, the development of refrigeration in the 1880s allowed perishable products to be stored, and in 1882, the first refrigerated shipment of 4,908 sheep and lamb carcasses was successfully transported to England from the South Island on the sailing ship Dunedin. Within ten years more than 17 freezing works were operating, mainly at the export ports. By 1916, there were more than 30 works, processing close to four million carcasses a year, which were exported for a value of £7 million, or 20% of the value of all exports. With the further £2.5 million in export earnings from tallow, hides and skins, the meat industry was earning close to one-third of New Zealand’s total export earnings.
These first freezing works, many of which were still operating more than three-quarters of a century later (albeit with much improved technology and hygiene), were owned either by New Zealand farmer co-operatives or, increasingly after the turn of the century, by English meat importing firms.” (p.27 of The second chapter, ‘Red meat’, by C.W. Maughan, pp.25-52)
“Ever since settlement, the marine resources of New Zealand have provided an important, renewable source of food for local consumption and trade.” (p.53, Fishing, by Basil M.H. Sharp, pp.53-85)
“Sugar is the household name given to the chemical substance called ‘sucrose’ which is manufactured from both sugar cane and sugar beet. Cane is the source of about 60% of world sugar production of about 120 million tonnes, with beet supplying almost all of the balance. As a final consumer product, and as a sweetening agent and preservative in a wide variety of foodstuffs, sugar is one of the world’s most important sources of nutrition. It accounts for more than 10% of available calories, and is next in importance only to wheat, rice and maize. Here the focus is exclusively on cane sugar, the sole basis for the sugar refining industry in both New Zealand and Australia. In New Zealand, consumption of refined sugar has been estimated at 43 kgs per person, although actual human consumption is 39 kgs because of the non-food uses of sugar, such as for animal feeds, brewing, yeast manufacture, and pharmaceuticals.” (p.149, Sugar Refining, by Michael Pickford, pp.149-182)
I’m not going to quote more extensively, because the book is quite old and probably needs to be read in context of newer studies/statistics – but it is interesting and, in historical terms at least, full of information!
Ref: Eds. Michael Pickford and Alan Bollard (1998) The Structure and Dynamics of New Zealand Industries. The Dunmore Press: Palmerston North
David Ballantyne (2010) Sydney Bridge Upside Down. Text Publishing: Melbourne (Introduction by Kate De Goldi)