Venture to mussel in on China market

July 14, 2010 14:35

Major mussel producers, including Nelson-based Sealord and Blenheim-based Aotearoa Seafoods, have formed a joint venture company to export to China, reports with reference to The Nelson Mail.

Pure New Zealand Greenshell Mussels General Partner was established just over three months ago and involves Sanford, Pacifica Seafoods and Greenshell Investments.

Companies Office records show Sanford and Pacifica with 35 per cent and 30 per cent shareholdings respectively in the company.

Records show the other partners hold just under 12 per cent each.

Keith Palmer, chief executive of Wakatu Incorporation, which owns Aotearoa, said the aim was to set up a single-desk seller into the largely untapped Chinese market.

"The mussel industry has torn itself apart competing with each other in the US market, so we decided not to do the same in China and to go in jointly so we preserve the uniqueness of the product and stop it becoming a commodity and get a fair price for it."

The joint venture, which had been talked about for a year, had so far set up a company in China, rented offices and appointed a fulltime manager there, Mr Palmer said.

It had just received exhaustive market research "so we can structure our marketing and distribution efforts soundly rather than go off half-cocked".

"We didn't know what the Chinese think about mussels so it was essential for us to do and not just assume that we knew."

While it was a project that couldn't be rushed, the joint venture hoped to begin preparations for exporting in October, when the mussel season here reopened.

If it worked in China and provided the partners with better returns, "the hope is we can expand it and repeat the model elsewhere" in Asia.

Mussel exports were worth $202.5 million to New Zealand last year, but just $200,000 of product went to China, according to Aquaculture NZ statistics.

Mr Palmer, who was part of a recent seafood trade mission to China led by Trade Minister Tim Groser, said Wakatu - which has extensive seafood, pipfruit and wine interests - also saw great potential in exporting live lobsters and oysters there.

At present they had to be sent through Hong Kong, but under New Zealand's free trade agreement with China, from 2012 they would be able to be sent directly as an accepted product, he said.

While there was a "lot of positioning going on" among interested New Zealand companies, "I hope we can emulate what we have done in mussels and all work together".

"It's a matter of forming relationships and working out the best distribution channel so the product goes straight to China instead of through Hong Kong, so we cut out a couple of steps in the chain and keep those benefits for New Zealand."

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