This week Heinz Wattie’s announced the inevitable – 350 or so roles cut.
By far, most of these will be in their operations in Dunedin, Christchurch and Auckland.
But some, as many as fifty but perhaps fewer than ten BayBuzz is told, will come from shutting their frozen food production line in Hastings.
Mayor Wendy Schollum commented to BayBuzz: “Any loss here is felt across our whole community. We feel for every worker at the affected sites, and especially for the Hastings whanau impacted by the loss of the frozen line.
“Wattie’s remains a major employer and a vital part of who we are as a district. We’ll be working with our economic development partners to understand the full impact on our community. Wattie’s and Hastings have grown together for nearly a century, and we hope that continues for many decades to come.”
Is that realistic, though? Heinz Wattie’s NZ has been losing money for several years now. Here in Hawke’s Bay, it’s been buying less and less from local producers … think peaches as the most recent example.
Watties employs around 450 permanent employees in Hastings, swelling to around 950 when the fruit and veggies are being harvested. Big numbers in themselves, with an even larger ripple effect if key product lines (let alone the entire plant) were to be shut down.
The company is owned by US-based conglomerate Kraft Heinz, which is 37% owned by legendary investor Warren Buffett. Warren Buffett does not invest to lose money. Nor do the company’s other financial return-focused investors.
This tiny NZ operation plunked at the end of an ever more unpredictable and expensive supply and distribution chain — even on a good day (and now think Donald Trump) — is doomed for oblivion.
So what are we to do while we wait for the final shoe to drop?
Appeal to our councils-supported regional economic development team to save the day? That agency (the HB Regional Economic Development Agency, REDA) is being terminated this month. But it wouldn’t have made a difference. The fate of Heinz Wattie’s will be determined in Pittsburgh Pennsylvania (Heinz) and Omaha Nebraska (Buffett) and communicated in an email.
Clearly, there are controllables (or at least relatively so) and uncontrollables (the weather, Warren Buffett). And when it comes to Hawke’s Bay (and NZ) agribusinesses, mostly it’s uncontrollables.
But who in Hawke’s Bay thinks about this in any systematic way?
REDA, when it existed, might have at least put together some sort of primary sector ‘risk assessment’ so we could at least worry systematically about the sustainability of half the region’s economy (i.e., the primary sector). They could investigate: What can we do if the likes of Watties, Rockit apple, AFFCO, McCain (the remote outpost of a Canadian multinational), Ravensdown – as just a few examples – were to fold?
Given the uncontrollables involved, maybe these wouldn’t be preventable, but how about a plan for digging our way out of the debris and/or hedging our bets by encouraging other, less vulnerable regional economic investments?
Our region has shown an impressive ability to orchestrate recovery from natural disaster, how about recovery from economic disaster? To say nothing of anticipatory scenario planning?
These are big challenges, though, apparently beyond the comprehension of councils preoccupied with deputy mayor selection and whether to hold meetings on marae.
And meantime, the HB private sector seems equally incapable of thinking or organising collectively on such matters, with each player focused on their own bottom-line and survival.
The result? It’s called drift. Hawke’s Bay is adrift, awaiting (or oblivious to) the second shoe dropping. Or am I simply a ‘Henny Penny’ alarmist? [‘Chicken Little’ where I come from]
Consider these final words from Andrew Donegal, Heinz Wattie’s NZ managing director, speaking to NewstalkZB: “Wattie’s has been alive for 93 years, it’s a brand that Kiwis love. What we do know is, if we don’t make these changes now, it’s going to be quite challenging to run the business for the future.”
Thoughts anyone?
The predictable result of selling out to multi-national corporations. Jimmy Wattie was a household name and a recognizable local when I was a kid growing up in Hastings. To see his business today controlled by Warren Buffet is not progress! We are losing control of our food sovereignty!
Bigger is certainly not always better.
Just maybe, this current, world-wide fuel-price hike is not going to ease any time soon, and it may simply become too expensive to export any food crops? Suddenly produce grown in our own back yards may well become cheaper, or will they be tilled back into the soil?
If we’re reliant on anybody from Trump’s America we’re in a fools paradise – they will only ever do something that lines their elite pockets.
Not a lot of detail on the remaining Hastings operations.
Why is the Tomoana National Distribution Centre for Sale with empty possession 2027
I believe Shane Jones has the answer. New Zealand needs to start to protect its borders from international owners and cheap food crops being allowed to enter New Zealand. We need to accept that we are being caught up in international de-industrialisation. Both National and Act are hiding behind the fact that Watties is an independent company. My question is : Who will be paying the unemployment benefits when staff are made redundant – Not Watties. Peter Moore
I believe the time is right for our farmers and local investors to form a co-operative that is vertically integrated from farm to retail market. This would include a chain of retail stores throughout the country to directly compete with the two main players. New processing facilities would also be required with up to date machinery and practices to produce healthy food options. The dairy farmers are currently in a financial position to invest in this type of venture. Co-ops have been successful in the past and instead of moaning about what overseas owned companies are doing to our livelihoods, we should be thinking how we can secure our own food security and keep control and profits here at home. So where from here? I think this is right up Tom Belford’s alley to spark the conversation publicly to test the waters to see if we can garner enough interest.