Reflecting the success of its market-led beef programmes, which since their inception over 10 years ago have delivered almost $30 million in additional value to farmer suppliers, Silver Fern Farms has today announced it will increase the base-line premiums from next season.
Silver Fern Farms Chief Executive Simon Limmer said this is underpinned by the company’s absolute commitment to delivering additional value to those that create it, and to tangibly connecting its farmers to international markets.
“Our approach with these programmes from the outset has been to make the market signals as clear as possible by rewarding farmers – via premiums – who meet the supply attributes and standards that global consumers demand,” said Limmer.
The almost $30 million in premiums paid to farmers to date, which are paid above the standard beef operating price, have been shared among around 3,000 farmers who have supplied into the Silver Fern Farms 100% Standard Prime Beef Programme and 100% Angus Beef Programme, and Silver Fern Farms Premier Selection Angus and Reserve Beef Programmes.
Silver Fern Farms is on track to process 24 percent more beef animals across its current four market-led programmes over the course of the 2020-21 season than the prior two years.
“The increase in premiums from next season reflects our confidence in ongoing growth in participation in our market-led beef programmes, as well as our confidence in continued demand based on the relationships we have fostered in-market,” said Limmer.
Silver Fern Farms General Manager of Supply Chain Dan Boulton said it takes time to build market-led programmes that can deliver sustainable premiums, which endure over time.
“Our in-market teams have worked hard to give confidence to customers and consumers that the quality of our products, supply attributes, and consistency of supply, deserve to attract premiums on an ongoing basis.
“The quality of the animals delivered by farmers, combined with our investment in in-market relationships and our brand, has created an industry-leading foundation from which we can continue to drive value in these programmes. In turn, we can continue to reward farmers who are investing more to meet consumer expectations,” said Boulton.
To support the growth in its beef programmes, Silver Fern Farms has invested $17 million at its Pacific processing facility in Hawke’s Bay to give it greater capacity. The company also continues to work on increasing its capacity to process more programme cattle in the South Island, most recently investing $3.5 million in the boning room of its Otago processing facility.
Silver Fern Farms will be adding its Net Carbon Zero Angus Beef Programme by the end of 2021, creating opportunities for farmers who meet the criteria for Toitū carbon zero certification to be rewarded for that as an attribute that global consumers increasingly demand.
Silver Fern Farms’ new baseline beef programme premiums for the 2021-22 season will range from $0.30 to $0.55 cents per kg depending on the programme, with further premiums available for the 2022 winter supply period and for farmers who meet their contract and specification requirements.
Farmers wanting to know more about the programmes and associated premiums should contact their Silver Fern Farms Livestock Representative.