Business News

NZ gluten-free boom prompts new testing service

New Zealand’s largest privately owned testing laboratory, Hill Laboratories, is offering a gluten testing service with the fastest turnaround-time in the Country. The company has introduced the service in response to the rapid increase in consumer demand for gluten free products, which according to Coeliac New Zealand Incorporated, is increasing in NZ by an estimated 26% annually. Technologist, Sam Marengo, said Hill Laboratories developed the test to ensure those purchasing gluten-free products can correctly label their gluten free foods for the benefit of consumers. “More and more Kiwi consumers are avoiding the ingredient due to gluten intolerance or simply dietary preference,” Marengo said. “As a result of more Kiwi’s going gluten free, manufacturers and retailers across the country are feeling the pressure to respond with gluten free products. “Supermarkets now dedicate whole aisles to gluten free products and more cafes and restaurants offer gluten free food. Marengo says the turnaround time for Hill Laboratories’ gluten testing service is 5 days, which is between 2 and 5 days faster than its competitors. “This service will enable manufacturers, retailers, local cafés and restaurants to accurately label their products and check for cross-contamination. “By utilising our gluten testing service, manufacturers, retailers, local cafés and restaurants across New Zealand can label their products appropriately, for this important gluten free audience.” Marengo said According to the Australia New Zealand Food Standards Code, manufacturers who label foods “gluten free” must not contain detectable gluten (no more than three parts per million)2. “When a manufacturer tests with us, they can find out whether their food adheres to the Code, and therefore ensure they have the correct labelling,” Marengo said. “In turn, consumers can be sure that what they are purchasing is indeed gluten free and safe for them to eat.” Marengo was appointed to Hill Laboratories in […]

Offshore boost

New Zealand’s manufacturing sector continued its expansionary path for October, according to the latest BNZ – BusinessNZ Performance of Manufacturing Index (PMI). The seasonally adjusted PMI for October was 53.3 (a PMI reading above 50.0 indicates that manufacturing is generally expanding; below 50.0 that it is declining). Although this was 1.7 points lower than September, the level of expansion was still healthy. The sector has now been in continued expansion since October 2012. BusinessNZ’s executive director for manufacturing Catherine Beard said that despite the slower rate of expansion in October, the proportion of positive comments from manufacturers moved up from September. “Although the key sub-indices of production (53.1) and new orders (55.9) both experienced lower levels of expansion, they continued to lead the way for October”. “In addition, the proportion of positive comments for October (61.8%) picked up from September (58.7%), with many of these in relation to increased offshore orders and new customers. BNZ Senior Economist Doug Steel said “it was interesting to see a decline in inventory this month especially in the context of new orders remaining above-average – it’s a signal for more production ahead.”

Profits lift for New Zealand’s biggest steel distributor

Steel & Tube, New Zealand’s biggest steel distributor, posted sales of $502 million for the year ending June 2015, with after-tax profits up by 20% to $21.4 million. “It’s been a significant year for S&T,” CEO Dave Taylor told shareholders at the Company’s Annual Meeting. “We have focused our efforts on enhancing efficiency and strengthening our core business.” S&T has recently opened three purpose-built facilities: two in Auckland (an area that presents around one-third of domestic steel demand) at Savill Drive and Highbrook, and one in Palmerston North. Their completion marks a key milestone in S&T’s extensive $30-million One Company reinvigoration programme, putting it at the forefront of New Zealand’s steel distribution and processing sector. In August and September the Company announced the acquisition of MSL, distributors of Fortress Fasteners, and large bore polyethylene pipe companies, Aquaduct and Bosch. Board Chairman Sir John Anderson said the acquisitions will take S&T into new and exciting territory as well as helping to off-set volatility in the commercial steel market, and a moderating New Zealand economy. During his speech to investors, Mr Taylor warned that increasing low-priced steel exports and imported pre-fabricated steel was putting New Zealand’s steel industry under pressure, adding: “Finished steel prices are now at their lowest level for almost 13 years. “Chinese exports have increased by 38% in the year ending September 2015 and will likely exceed 100 million tonnes this year. Putting this into perspective, New Zealand’s demand across all steel products is less than 1 million tonnes a year.” Mr Taylor pointed out that many jurisdictions have introduced anti-dumping legislation to help protect their steel industries, increasing the focus on those countries where such actions are not being pursued, such as New Zealand. He cited the recent number of steel mill closures in the UK and the […]

Business addressing climate change

Climate change is moving up the agenda for New Zealand businesses, according to a survey released by BusinessNZ. Businesses that make up 36 percent of New Zealand’s private sector GDP participated in the BusinessNZ Climate Change Survey. The survey shows that 61 percent of those surveyed have introduced initiatives to reduce emissions, and that businesses want to see unified commitment at the international climate change COP21 negotiations in Paris this month. BusinessNZ has also released a Business Brief for the COP21 negotiations. BusinessNZ Head of Climate Change Policy John Carnegie says business will continue to take action regardless of what happens at Paris, but the negotiations are still an opportunity to set climate goals to give businesses the confidence to invest, innovate and act to reduce emissions. “We need to see an agreement that sets a predictable and transparent regulatory environment, to provide the direction to enable scaled-up action at a country level. “New Zealand businesses want to work with Government to develop and implement market-driven solutions to address emissions while maintaining our international competitiveness. This means supporting the development of international carbon markets to facilitate the global transfer of low emissions technology and finance to where it is needed most. “Through to 2020, businesses in New Zealand will focus on reducing emissions in the transport sector, improving energy efficiency beyond transport, improving urban infrastructure and being strong leaders on climate change mitigation and adaptation.” Survey findings: • 52% of respondents said climate was a material issue that warranted a business response. • 61% have introduced initiatives to reduce climate emissions. • Two-thirds of respondents have emission reduction targets in place, with strong representation from energy, transport, telecommunications and retail sectors. • 85% of business climate activity sits within business operations, working with customers and through supply chains. • Climate […]

Conditions remain volatile for manufacturers

The latest New Zealand Manufacturers and Exporters Association (NZMEA) Survey of Business Conditions completed during October 2015, shows total sales in September 2015 increased 3.28% (year on year export sales increased by 0.06% with domestic sales increasing 12.1%) on September 2014. The NZMEA survey sample this month covered NZ$314m in annualised sales, with an export content of 71%. Net confidence rose to 23, up from 5 in August. The current performance index (a combination of profitability and cash flow) is at 102.3, down from 111.0 last month, the change index (capacity utilisation, staff levels, orders and inventories) was at 97, down from 99 in the last survey, and the forecast index (investment, sales, profitability and staff) is at 104.83, down on the last result of 106.67. Anything over 100 indicates expansion. Constraints reported were 77% markets and 23% skilled staff. Net 38% of firms reported a modest fall in productivity in September. Staff numbers for September increased 0.35% year on year. Tradespersons, supervisors, managers, professional/scientists and operators/labourers all reported a moderate shortage. “Export sales were flat in September, reporting no real change on the same month in 2014, although there were improvements on last month’s fall of 3.18%. Domestic turnover bounced back into year-on-year increases, at 12.1%, a stark difference to August’s decrease of 13%. This month represents some positive turn-around from a downward trend in recent months, but manufacturers and exporters are clearly still facing a lot of volatility. “says NZMEA Chief Executive Dieter Adam. “Staff numbers were also flat in September and changes in sentiment measures were mixed. Confidence improved on last month, from 5 to 23 in September, while the performance, forecast and change index measures all saw reductions from their values in August. “The only reported constraints were markets, moving up higher to 77%, and skilled […]

Councils can do more to develop regions of opportunity

While New Zealand cities and towns are not global mega cities, there’s opportunity for regional New Zealand to become ‘regions of opportunity’, according to PwC’s New Zealand’s regions of opportunity publication, launched at this morning’s Society of Local Government Managers’ conference in Palmerston North. PwC Local Government Director David Walker says size and scale are not the only determinants of success for a city and successful cities are strong across a range of indicators – there’s no single factor that drives success more than others. “A recent report from the New Zealand Initiative discusses the idea of using special regional economic zones in regions to boost foreign investment and assist new enterprises to start up. This cannot happen without the directive from central Government. “Developing into regions of opportunity will take a collaborative effort by councils, central Government and businesses,” he says The publication offers three key steps of advice for councils hoping to advance the prosperity of their region, which include: 1. Be ready – know what you offer. The best place to start is the status quo. Know what your strengths and weaknesses are, and develop policies to improve from there. 2. Have a people strategy to promote liveability and attract talent. Consider how to attract and retain skilled workers. Also consider how to grow talent from within the region, and ensure that workers are well placed to respond and grow the region together. 3. Recognise that solutions may be collaborative. Collaboration can be in many different forms and with different entities. Collaborative approaches should ensure that each entity is invested in achieving shared outcomes.

Growing regional research initiatives

While emerging or fledgling industries do exist, the missing link that should sit alongside this initiate is serious and comprehensive industry development activity, so that industry can grow swiftly to a level where it really can use and exploit the science developed and make a real contribution to regional development. Commentary by HERA Industry Development General Manager Nick Inskip Announced in the Budget on the 21st May was an item around the establishment of independent regional research institutes. The intent being that the Government would provide funding towards the establishment of a number of institutes to be located in regional areas and not in the three large centres of Auckland, Wellington and Christchurch. The model espoused was something like the role taken by the Cawthron Institute, which is located in Nelson and serves the needs of the aquaculture and marine ecology community. Cawthron has a history of almost a hundred years and employs around 200 hundred people. It is interesting to see how Cawthron has evolved from an initial concept – a technical institute to be developed from a bequest from Thomas Cawthron – into an institute that has developed alongside an industry and at various times has led, supported or followed its development. As an aspirational model Cawthron is excellent; it has critical mass to survive and even thrive outside a major city and has been well-supported by Government over the years. The intent of the new institutes is that they will operate as private, independently-governed entities working closely with industry and other regional actors to stimulate new leading-edge, commercially-focused and industrially exploitable research. A series of Regional Research Institutes Workshops have been held around the country with the intent of seeking input to the proposed initiative, and introducing high-level aims and eligibility requirements. So far, the workshops have […]

RBNZ holds OCR, challenges remain

The Reserve Bank of New Zealand (RBNZ) chose to hold the OCR at 2.75% today, though signalling further reductions may be required to reach their inflation target. Economic risks remain, and continued work from Government and business is needed to rebalance our economy towards high value-added, diverse exports, say the New Zealand Manufacturers and Exporters Association (NZMEA). NZMEA Chief Executive Dieter Adam says, “Another cut in the OCR could have helped better align our interest rates with the rest of the world and help move our exchange rate back down its correcting path. Unfortunately we have seen our exchange rate move in the wrong direction recently, as described by the RBNZ “the exchange rate has been moving higher since September, which could, if sustained, dampen tradables sector activity and medium term inflation. This would require a lower interest rate path than would otherwise be the case”. “It remains important that our currency continues on its rebalancing trend, helping exporters to regain ground in markets after the extended period of an unsustainable exchange rate. “This week’s merchandise trade deficit came in larger than expected, due to increased imports and lower export values, largely fuelled by the fall in dairy prices and volumes. However, it was encouraging to see mechanical machinery and equipment continue recent positive trends in export values; improving 3.6% on last quarter, and increasing 6.6% on the same quarter last year. “As a country we need to continue to rebalance our economy away from investment in unproductive assets and towards a more diverse, value-added export economy that allows us to pay our way in the world and improve all New Zealanders quality of life. This requires both helping commodity producers move up the value chain, as well as encouraging and supporting higher-value, highly-skilled manufacturing and exporting businesses that build […]

Peterson’s Perspective: Will the science and R&D plan work?

by Gilbert Peterson For the past six years New Zealand’s innovation landscape has been littered with dithering and waste as the country’s investment in science and R&D failed to rise to an average OECD performance. With that in the background this week’s announcement of the new ‘National Science Strategy’ and Building Innovation plan, must surely be Minister Steven Joyce’s last shot at gaining traction in this the economy’s weakest performing, and most critically exposed area. The launch of the new way forward for science and innovation is at least as important, if not more so than the announcement of the TPP agreement though totally eclipsed by it. But the question remains: Will the new approach prove the most efficient and effective way to move science investment and its commercialisation significantly forward? Science and Innovation Minister Joyce deserves congratulations for hearing what business and the science community had to say, and coming up with a plan to address their concerns. For the first time I can recall the minister articulated clearly the economic value contribution made by science and R&D to the nation. In launching Building Innovation he said: “Successful innovation improves competiveness, increases our output, drives productivity growth, and creates successful exports by introducing new or improved products, processes, or methods into the economy.” Bravo for that. Our future prosperity depends on innovation and the science and R&D that underpin it. The chief economist of the Ministry of Business, Innovation and Employment, Roger Proctor, spelled this out in a blog earlier this year. In answering the question, ‘Where does income growth come from?’ he said it comes from increases in productivity that occur when new things are produced that people are willing to pay more for than they cost to produce, and by producing new things we already produce with […]

Partnership a win-win

The partnership between rugby league’s national sports team, the NZ Kiwis, and international fluid transfer products and services provider, Pirtek has been a positive and successful one for both. Since joining forces with the Kiwis prior to their first Rugby League World Cup win in 2008, Pirtek has expanded its business, opening new franchises in New Zealand and overseas. At the same time, the Kiwis have turned their wins in key finals (2005 Tri Nations, 2008 RLWC, 2010 Four Nations) into an unbeaten run through the 2014 Four Nations tournament, backing it up with a win, their third in a row against Australia, in an historic rain-delayed test match in Brisbane in May. NZRL CEO Phil Holden says of the sponsorship, “The Pirtek name has become synonymous with rugby league and the Kiwis. We have a very close relationship that benefits both parties. We are fortunate to have such a supportive sponsor family and Pirtek is an integral member of the group. “With the tour to the UK later this year, the Pirtek name on the Kiwis jersey is a store window for Pirtek, as they look to cement their place further in the international market.” The Pirtek business which was founded by a New Zealander has been successfully implemented in Australia, New Zealand, China, Singapore, South Africa, USA, France, Netherlands, Germany, the United Kingdom, Mongolia and Canada. One of the key features of the partnership is the fantastic grassroots support provided by Pirtek and their franchisee network around the country. They have contributed to a number of grassroots development initiatives, provided scholarships to allow players to attend elite development programmes and funded the Volunteer Recognition programme. The programme acknowledges volunteers each month culminating in two major presentations at the NZRL Annual Awards. Fans of the game also receive a […]

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