2019/2020 – 2023/2024 Intent Corporate of Statement transforming agriculture transforming by prosperity Driving 01

Financial Statements G36

Driving prosperity by transforming agriculture

Chair and Chief Executive overview 02 Our strategic direction 04 The AgResearch Science Plan 06 New Zealand Bioeconomy in the Digital Age 08 Strategic science investment funding 10 Protected, enhanced, and sustained natural resources 12 Prosperous land-based enterprises 18 Added-value foods and bio-based products 26 Integrated facilities for research excellence 32 Māori Agribusiness 34 Vision Mātauranga 36 Our people 38 Aligned to government priorities 40 Sustainable future roadmap 42 Financials 44 Financial results 46 Non-financial targets 48 Miscellaneous items 50 Chair and Chief Executive overview

AgResearch, through innovative science and research, is leading the way for the future of land-based food production in New Zealand.

Despite primary industry export performance sought from our refreshed Science Plan is to exceeding expectations in the 2018/19 year, the increase the value of New Zealand’s exports agricultural sector is facing some considerable while enhancing our environment and challenges as it looks to the future. The effects underpinning our regional prosperity. This of climate and environmental change, rapid is supported by the two key overarching and advances in technology and food production integrated areas of science focus; creating systems, and evolving consumer preferences the smartest and most sustainable land use and expectations have meant a significant shift systems, and the most sought-after high value in what is needed for New Zealand’s agricultural- food and bio-based products. The Science Plan based economy to continue to flourish. was developed with the knowledge that future food production systems will be significantly Innovative science and thought leadership are different from today, and with recognition essential to support this shift. New Zealand that we must develop new and smarter will need to be at the edge of innovation and collaborations, with disciplines and partners technology for primary industries to succeed in outside of our traditional networks to create the future. AgResearch, as the Crown Research effective transdisciplinary teams. Together, Institute (CRI) primarily responsible for engaging the Science Plan and the SCI outline how pastoral, agri-food, agri-technology, and AgResearch will deliver our strategic goals, and environmental stakeholders with thought-leading how this leverages domestic and international scientific outcomes, is committed to creating collaboration. new opportunities and providing options to respond successfully to the challenges and In amongst the many and varied world-class opportunities faced by the sector. science programmes across our research areas currently under way, we have recently embarked This Statement of Corporate Intent (SCI) on a new Ministry of Business, Innovation sets out the framework for the research we and Employment (MBIE)-funded platform of will undertake in the coming five-year period research – the New Zealand Bioeconomy in 2019/20 - 2023/24. As in past years, this the Digital Age. The platform is an excellent framework has been created through close opportunity to put our refreshed Science Plan engagement with our stakeholders and national in action. It is designed to enable the transition and international collaborators. to diversified landscapes, to utilise digital technologies and data for land use design and AgResearch is well-placed to support the decision-making, and to connect food and bio- government’s science and innovation priority based product attributes across the value chain. areas. These areas include transitioning New Zealand’s primary industries into higher value A number of use cases are under way to products and exports, understanding and establish a ‘proof of concept’ that digital mitigating the effects of climate change, and technologies can and will transform New supporting the transition to a low emissions Zealand’s pastoral land-based sector. These economy. There is a clear role for our science include interdisciplinary approaches for to assist in these areas and in doing so we converting data to information at different support thriving and sustainable regions. scales, simulation and visualisation tools to accelerate adoption change, novel methods for To be successful, our science must be bold, linking food and bio-based product attributes agile, and future-focused in nature. The impact across the value chain, Māori agribusiness land Chair and Chief Executive overview Chair and Chief Executive

02 years. Inyears. 2019/20 for focus Lincoln, the and this on coming in the to reporting forward Institute, and Riddet look and the University joint the of with approachMassey benefits the We realising about in 2020. early are excited Palmerston completion for North is scheduled Facility Science Food in The industry. wider collaborators, and the our partners, with Lincoln that will greater enable collaboration and North in Palmerston facilities advanced fit-for-purpose, new will see technologically ofways this working This requires. programme of Plan, our new embedding Science and the the programme supports investment capital Our years ahead. in the sector the for resulting and the advancements demonstrate, will thisoutcomes scientific platform the about We systems. are excited production and food Zealandtransformation of New agriculture is to harnessed the enable digital technologies visionOur of this for is power that work the digitised value chains. in increasing for andmodels value equity trust businessinformation, and new and governance AgResearch Acting Chair, Dr Paul Reynolds review process. review during upcoming the science engaging further to alsowithin forward AgResearch, we look progressed being transformation processes the Given afield. Zealandin New and further will havework transforming on agriculture have to play,our significant and the impact change. we role We the about are excited through major sector the support we as AgResearch for five years critical are next The Zealand.value New for toenvironments our underpin enduring future possible and facilities best delivering the continue innovative to seek to approaches remains and focus AgResearch will acritical aresult fiscal responsibilityenvironment. As constrained continues in to acapital operate initiatives, key AgResearch strategic with significantWhilst progress being is made area. in the innovation precinct research, and education, of a wider stage first the facility, will be which AgResearch-led of an is design and the construction beyond AgResearch Chief Executive, Tom Richardson 03 03 FinancialChair and Statements Chief Executive overview Our strategic direction

AgResearch’s vision remains unchanged — to drive New Zealand’s prosperity by transforming agriculture.

Over the past year AgResearch has continued The breadth of AgResearch science capability, to refresh its strategic position. We have spanning the agricultural value chain, refined our overarching strategy and continues to underpin the organisation’s developed the next tier of detail around our differentiated value proposition whilst Strategic Initiatives in our refreshed Science ensuring a focused approach to delivering the Plan, a process that included extensive stated impact of increasing the value of New engagement with both internal and external Zealand’s exports. All the while enhancing stakeholders. our environment and optimising land use outcomes. This vision is supported by a focus on the two broad areas of aspiration; developing The AgResearch strategy is well aligned the world’s smartest and most sustainable to government priorities and will support land use systems and developing the most accelerating the shift from volume to sought-after, high value food and bio-based value agricultural production, enabling the products. Applied consistently to these transition to a productive, sustainable and aspirations are the twin lenses of consumer low emissions economy, and directly support focus and a systems based, integrated thriving sustainable regions. approach to science seeking to bring the best possible teams together to tackle both issues and opportunities, leveraging both the breadth of AgResearch capability and an extensive and developing network of external collaborators. Our strategic direction

04 while stayingfirmlygrounded. AgResearch reachesforthestars Our tohurepresentshow systems land use sustainable most Smartest, Our Impact Driving prosperitybytransformingagriculture 3. 2. 1. organisational performance: identified tounderpin,direct,andfacilitate Five criticalstrategicinitiateshave been collaborative. innovative, energised,vibrant, and aligned organisationalculturethatis One AgResearch –Investing inan and environmental constraints. technology, science,consumerdrivers, rapid changesinfoodandfarming upon emergingopportunitiesfrom focused areasofresearchthatcapitailise enduring value viaintegratedand Revitalised SciencePlan–Creating science capabilityandcapacityover time. sustainability allowing reinvestment into Financial Strength– Our consumer-centred, system-based system-based consumer-centred, Our science drives world’s... the science our environmentandoptimising landuse Increasing thevalueofNewZealand’s exportswhileenhancing

commitment to Te Ao Māori. capability isembeddedwithour Our integratedresearch sought-after bio-based products food and 5. 4. Most enhance impact. enabling systems andprocessesto way wedeliverscienceandtoimprove Embracing technologytochangethe Transforming ThroughTechnology – support thetransformationprocess. investing inpeopleandprocessesto facilitating collaboration. This means innovation andeducationcentres facilities, anddevelopingresearch, the fourcampusmodel,includingnew New Waysof Working –Implementing O N R T F Technology Transforming through New Ways ofWorking One AgResearch Revitalised SciencePlan Financial Strength Initiatives Our Strategic 05 Our strategic direction The AgResearch Science Plan Putting our strategies into action.

Our Science Plan has been refreshed and revitalised and places a greater emphasis on an outcome and objective- focused strategic framework. The changes demonstrate AgResearch’s adaptability and agility against a rapidly evolving science sector and changing community and government priorities.

Our expected outcomes will achieve the These objectives cut across diversified following: pastoral landscapes and new land-based • Protected, enhanced, and sustained enterprises that deliver to local and natural resources international values. • Prosperous land-based enterprises • Added-value foods and bio-based Our climate change research objectives will products that meet consumer needs. range from the reduction of methane and nitrous oxide emissions of grazing systems, We know New Zealand because of our size, to the resilience to adverse weather events scale, and capability is uniquely placed to and the prevention and management of transform current food production systems biosecurity risks. We want to foster a vibrant to meet these needs. It falls to AgResearch Māori agribusiness sector with our research and our collaborators to enable this focus on product attributes reflecting Te Ao transformation by providing the scientific Māori. advances that will support these new systems. These scientific advances take We will develop fit for purpose forage and time, and therefore, our Science Plan must animal diversity systems and tools that meet New Zealand’s short, medium and long promote world-class animal health and

The AgResearch Science Plan AgResearch The term needs. welfare. We will drive scientific discovery

06 e Added d us val ise bio-b ue im rces ase foo pt ou d p d O es ro s f r d an o uc d ts

p la F i n t d t - e f Prosperous Protected, s o

m s a r - r r land-based enhanced and n p o o d u f t

s c r a enterprises sustained natural p e n n

o s a i

r s resources m

T e

a

l s

Added-value

foods and bio-based e i g a b products that meet r n d g a a n r n consumer needs h a ib t c u n n M te o s ā a ti io in o a t e r im t a s i l p ig s C da it a m Su d stainable agri-foo p roduction systems

pertaining to added-value foods and soil scientists to food safety researchers, bio-based products, including food and AgResearch has the science capability to ingredient verification and reduced waste. We apply critical thinking right across the value will support business models and policies chain. that enable this transformation. Our refreshed Science Plan will guide the Our Science Plan objectives take into account science that we will conduct, our internal the complex value webs that connect on-farm investment, and reinforce the behaviours practices to consumer demands and address we will need to deliver our vision. It the critical questions such as: where is the will be embedded with the principles of end product going, where has the product kaitiakitanga, which reflects our focus on come from, and what is the impact of Vision Mātauranga. the production system? The objectives outlined here will form Animals and forages are not the only the framework of measurements for our drivers to boosting New Zealand’s prosperity, programme of work. but they have input. Understanding that and knowing how AgResearch science can

play its part is how we will succeed. From Science Plan AgResearch The

07 New Zealand Bioeconomy in the Digital Age

AgResearch has launched a new research programme called the New Zealand Bioeconomy in the Digital Age (NZBIDA).

The programme is a MBIE funded $10m We’ve identified and designed 12 case project to deliver a ‘proof of concept’ that studies that will demonstrate ‘proof of digital technologies can transform New concept’ to stakeholders and researchers. Zealand land-based food production. They will expose scientists and stakeholders AgResearch and a broad range of to global thinking about non-traditional and collaborators will do the science of today that disruptive technology options. And they will will enable the pastoral sector to transition to be integrated vertically and horizontally to a more adaptive and sustainable contribute to a ‘joined up’ programme that ‘bioeconomy’ of tomorrow. AgResearch is creates added economic, environmental, uniquely placed to deliver on this ambitious cultural and social value by producing, project. It is designed to enable the transition converting, and using knowledge with to diversified landscapes, utilise digital biological raw material. technologies and data for land use design and decision-making to connect food and The case studies all use the tools of bio-based product attributes across the a successful bioeconomy: advanced value chain. engineering, nanotechnology, sensor technology, precision measurement, We have long-lasting and deep relationships communications, genetics, automation, within the pastoral sector and we’re a robotics, analytics, and decision support research focused organisation that has tools that can transform production systems embraced the digital revolution that is and ensure a safe and traceable product allowing intellectual endeavour on a scale supply. We will also work with partners who never seen before. The broader agricultural are heavily focused on developing niche value sector has been relatively slow in its uptake chains that incorporate Mātauranga Māori. of digital technology, therefore, AgResearch’s job is to add impetus to the transformational

New Zealand Bioeconomy in the Digital Age in the Digital Bioeconomy New Zealand change required.

08 New Zealand Bioeconomy in the Digital Age in the Digital Bioeconomy New Zealand

09 10 FinancialStrategic scienceStatements investment funding investment funding investment science Strategic Nationally Significant Database and Collection. the MargotForde GermplasmCentre asa we receive$470,000patohost andmanage contributes tobothplatforms. Separately Zealand’s Bioeconomy intheDigital Age that in atwo-yeardigitalagriculture initiativeNew This fundingincludesa$5mpainvestment to thesevenobjectivesofourSciencePlan. funding isallocatedtoprojectsthatcontribute Foods, ProductsandServices($12m). This Production ($31.4m)andPremium Agri- through twodefinedplatforms– AgriFood In FY20wewillreceive$43.4mSSIFfunding well-being. produced, nutritiousandsupporthealth that arehighquality, ethicallyandsustainably productions systems thatgeneratefoods and market needsbydevelopingfood integrated solutions;wecantargetconsumer Our researchprioritiesenableustodeliver and innovatenewsystems,practices,processes products rightacrosstheagriculturalvaluechain. AgResearch usesitsassignedcontributionfromthe Strategic ScienceInvestment Fund (SSIF)toexplore deliver onitsStatementofCore Purpose. projects outlinedwillenable AgResearch to Across thenextfivefinancialyears, the our researchisinternationallyrespected. chain isourpointofdifference,andensures research thatisconnectedalongthevalue collaborators. The abilitytoexcel inspecialist organisation, thesector, andwithother with theircolleaguesandpeersacrossthe their specialistfields, whileworkingclosely these twostrategicdriversbyexcelling in Our scientistsarefocusedondeliveringto foodandbioproducts.most sought-after land usesystems, through developingthe to developthesmartestandmostsustainable to ourtwo,interconnectedstrategicdrivers– Our consumer-centricresearchisaligned 11 Strategic science investment funding Protected, enhanced, and sustained natural resources Science Plan Outcome

Protected, enhanced, and sustained natural resources Aramoana

12 Project summaries FY20

Project Animal welfare for market success

Scope New Zealand products, and providing This research programme will advance animal guidance, management, and legislative welfare science and New Zealand’s reputation recommendations for stakeholders and internationally, and protect the market success Ministry of Primary Industries to maintain of New Zealand animal-based products within freedom to operate and provide social license. three broad goals: 1) Accentuate the positive Program delivery is designed in a way to aspects of New Zealand production systems in generate significant capability-building in ways that resonate with consumers, 2) Advance animal welfare. animal welfare science through developing innovative welfare measures that meet evolving SSIF Platform: definitions of welfare (e.g. sentience), and 3) Agri-Food Production Deliver animal behaviour and welfare expertise to support the sustainable development Key stakeholders and partners: of other programs within AgResearch. The Ministry for Primary Industries, Dairy NZ, programme comprises fundamental research Fonterra to maintain our world-leading understanding of animal welfare and builds capability and FY20 funding: delivers shorter term research outcomes to $1,232,000 address industry issues as they arise. Research outcomes will have a long-term impact, Project timeline:

Aramoana supporting consumer confidence in 2012 – 2021 Protected, enhanced, and sustained natural resources

13 Project Pasture weeds

Scope regional, and national levels for species already The overarching objective is to provide the present in New Zealand but with a limited science that will enable the New Zealand distribution and for new incursions; identify pastoral sector to achieve long-term cost- best management practices for selected priority effective management of weeds under a species (e.g. high-threat low-incident pests); changing climate. It will achieve this through account for global-change (e.g. climate and new strategies and tools for greatly improved land-use changes); and support evidence-based internal biosecurity and through next- pathway management. generation alternatives to synthetic herbicides. SSIF Platform: Our research on alternatives to herbicides will Agri-Food Production help realise the potential benefits of biological control of weeds through understanding Key stakeholders and partners: relevant biological processes and the Foundation for Arable Research, Regional associated risks; and by developing, testing, and councils, Dairy NZ, Crown Research Institutes, promoting (through stakeholder engagement) Ministry for Primary Industries, Agrichemical disruptive farming cultural practices that reduce companies weed control costs and environmental impacts of weed control. FY20 funding: $1,222,000 Our research on internal biosecurity will develop risk assessment and decision-making Project timeline: tools useful for engaged stakeholders at farm, 2017 – 2022

Project Better Border Biosecurity (B3)

Scope Novel analytical and modelling systems will The objective of the Better Border Biosecurity be available for defining levels of risk posed by (B3) research collaboration is to be a world- the various threats and models will be available leading source of science-based solutions for assessing their likely impacts should they for border biosecurity challenges by 2022, establish. supporting and protecting the competitiveness of export industries and unique terrestrial SSIF Platform: ecosystems. Agri-Food Production

The goal of B3 is to develop new knowledge, Key stakeholders and partners: tools, and approaches to ensure that harmful Ministry for Primary Industries, Environmental organisms are excluded before, at, and Protection Authority, Dairy NZ, Department immediately after New Zealand’s national of Conservation, Forest Owners Association, border and that these will be available to, Crown Research Institutes, Lincoln University and implemented by, key end users and stakeholders. By 2022, the major disease, weed FY20 funding: and pest species of threat to New Zealand $1,977,000 will be better known, their risk quantified and optimal points for intervention defined both Project timeline: off-shore and at the New Zealand border. 2015 – 2022 Protected, enhanced, and sustained natural resources

14 Project Margot Forde Germplasm Centre

Scope bioeconomy and the world’s bio- The Margot Forde Germplasm Centre and agro-diversity. (MFGC) is a Nationally Significant Collection and Database (NSCD) funded through SSIF SSIF Platform: Infrastructure that has been established to N/A collect and provide forage germplasm (seed), and therefore genetic diversity, to all forage Key stakeholders and partners: breeders and breeding programmes in DairyNZ, Grasslanz Technology Ltd, GRDC, New Zealand. It provides these genetic Grasslands Innovation Ltd and PGG Wrightson resources to the users to help them accomplish Seeds breeding targets in New Zealand and also provides data and information to New Zealand FY20 funding: and international researchers for their research. $470,000 MFGC’s mission is to provide a world-class operation of basic and applied seed banking Project timeline: and utilisation to benefit New Zealand’s 2012 – 2020

Project Climate change and the pastoral sector – impacts and adaption

Scope SSIF Platform: This programme of work will see us provide Agri-Food Production forewarning of the impacts of climate change on soil, plant, and animal interactions in Key stakeholders and partners: pastoral agriculture and to develop adaptations Ministry for Primary Industries, Ministry for the that will enable agriculture to ameliorate or take Environment advantage of the changing environment. FY20 funding: This activity includes future-proofing key $1,240,000 technologies (e.g. nitrogen fixation and biological control systems) so they remain Project timeline: effective under climate change. 2015 – 2022

Furthermore, the work aims to provide the information necessary for decision makers (farm, regional, national scales) to make informed choices in areas where the timescale and the nature of the activity mean they may be influenced by climate change. Protected, enhanced, and sustained natural resources

15 Project Agricultural system modelling

Scope thought piece on next generation modelling Agricultural system models are a crucial tools based on work undertaken in the SSIF element in supporting good environmental project New Zealand Bioeconomy in the Digital practice in New Zealand farming systems. Age. This is a critical piece of work, ensuring Increasingly, regional councils and other that AgResearch is well-positioned for the future regulatory bodies are relying on models to help development of models in New Zealand. understand and manage environmental losses from our farms. It is therefore important that SSIF Platform: models that AgResearch support are provided Agri-Food Production with the most up-to-date research data and clear and transparent model development. Key stakeholders and partners: Additionally, data for models is available from Fertiliser Association of New Zealand, Ministry many disparate data sources. Constructing for Primary Industries, Overseer Ltd, Chinese representations of farm systems in models or Academy of Sciences undertaking analytics requires accessing these disparate datasets, which is time consuming, FY20 funding: prone to error, and complicated by freedom $750,000 of data access and poor data interoperability. We propose to devise a new approach whereby Project timeline: data from those systems and technologies 2012 – 2020 can be accessed into a logical, more open data model to create a full picture of the farm enterprises to speed up modelling and analytics initiatives. Lastly the project will compose a Protected, enhanced, and sustained natural resources

16 Protected, enhanced, and sustained natural resources

17 Prosperous land-based enterprises Science Plan Outcome Prosperous land-based enterprises Niho Taniwha

18 Project summaries FY20

Project Nutritional approaches to enhancing ruminant lifetime performance and reducing wastage and environmental footprint

Scope intensification. This in turn will improve per By exploiting a mechanistic understanding of animal performance, reduce animal and feed the nexus between feed inputs and physiology wastage, environmental footprint, and improve of the animal we will deliver knowledge and animal health. evidence-based recommendations and develop beta-test novel nutrition-based intervention SSIF Platform: technologies for the pastoral sector. This Agri-Food Production will be achieved through a multi-disciplinary approach to key issues highlighted by the red Key stakeholders and partners: meat and dairy industries with implementation Scotland’s Rural College, INIA, Ballance Agri- of outcomes through projects co-developed Nutrients, Fonterra with stakeholders. FY20 funding: We will do this by modifying rumen function, $1,100,000 developing strategic supplementation strategies to enhance nutrient utilisation, Project timeline: and reducing wastage of animals and feed. 2017 – 2022 By meeting the nutritional requirements of animals we will improve animal welfare and consumer concerns about farming Prosperous land-based enterprises

19 Project Strategies to improve reproductive performance in dairy cattle

Scope functional pathways and molecules originating Milk and milk products remain New from the oocyte and related embryo survival, Zealand’s largest food export. However, as and understanding the role of the local immune milk production has steadily increased over system in conception loss. the last 40 years, fertility of the lactating cow has decreased. The overarching goal of this SSIF Platform: work is to improve the efficiency of the dairy Agri-Food Production sector through a greater understanding of reproductive processes and how they can be Key stakeholders and partners: manipulated to provide management solutions Dairy NZ, Ministry for Business, Innovation and to meet the industry’s target 6-weeks (from Employment planned start of mating) in-calf rate of 78%. This includes investigating the use of non- FY20 funding: steroidal anti-inflammatory drugs (NSAIDs) to $1,275,207 reduce inflammation in the early postpartum period, the search for biomarkers to identify Project timeline: cows with improved fertility, identifying 2015 – 2020

Project Animal health and welfare as the foundation for sustainable high‑value global markets

Scope welfare and food production. In addition, This programme of work is designed to deliver this programme provides critical support to farmers the knowledge and tools to meet future the Premium Agri-Foods platform by ensuring market demands for safe, ethically-produced, that the value added during processing food, specifically by producing resilient farms is accessible by first capturing consumer with low chemical inputs and superior animal preference for New Zealand’s way of farming. health and welfare. The programme aims to generate disruptive technologies (e.g. parasite SSIF Platform: vaccines) that will change future farm systems. Agri-Food Production The approaches are designed to enhance animal performance and lead to significant Key stakeholders and partners: gains in on-farm efficiencies (e.g. through Beef and Lamb NZ, OSPRI requiring fewer treatments and less mustering) through the creation of new animal health and FY20 funding: welfare management practices. In the long-term $2,176,335 we will help to build resilient farm systems that are able to adapt to changing expectations Project timeline: of society of the interplay on farms between 2018 – 2023 environment (including climate change), Prosperous land-based enterprises

20 Project The way forward: utilising a globally unique ruminant resource for consumer-focused, technology-driven science for sustainable farming

Scope out that is linked to the New Zealand industry This Animal Genomics core research project ensuring direct implementation and uptake of develops science leadership, key capability, science to achieve maximum impact. and novel technology to ensure sustainable and profitable farming in a rapidly changing SSIF Platform: environment. We will continue to drive Agri-Food Production genetic gain in New Zealand’s national flocks by discovery and demonstration within the Key stakeholders and partners: AgResearch resource flocks. We will develop Beef + Lamb NZ, Focus Genetics, Pastoral novel genomic and phenotyping approaches to Greenhouse Gas Research Consortium, NZ deliver new traits (e.g. methylation, adaptation) Agricultural Gas Research Centre, Pāmu Farms and advanced measures for existing traits (e.g. of New Zealand, Spring Sheep, Southern Cross live measures of pneumonia). Ultimately the Dairies programme aims to breed product that has been farmed with social licence (nutritious, FY20 funding: high-value food, from healthy animals with $500,000 reduced environmental impact). Maintaining and developing our globally unique resource Project timeline: flocks is critical to enable research to be carried 2013 – 2020

Project Forage value

Scope programme will inform farmers about choosing This project provides the basic research cultivars that deliver the balance of production that underpins the development and future and environmental outcomes that they want, expansion of the Forage Value Index (FVI). The and optimum sward management to realise FVI, led by DairyNZ and NZ Plant Breeders and expression of the desirable traits. Research Association, is providing dairy farmers with a facts-based online cultivar selection tool SSIF Platform: to identify the best ryegrass cultivars for their Agri-Food Production system. Beneficial environmental mitigation traits have been identified as critical for future Key stakeholders and partners: development of the FVI and we will continue DairyNZ, NZ Plant Breeders and Research research on this topic. A new initiative is Association, Forage Value Technical Working investigating the potential for climate change Group to transform “sleeper pests” into active threats to pasture performance. We will identify FY20 funding: the key plant traits required to achieve high $1,340,000 rankings across a range of FVI indices thereby providing breeders with specific traits to build Project timeline: into cultivars with the incentive that a high 2013 – 2020 FVI ranking will stimulate seed sales. The Prosperous land-based enterprises

21 Project Application of plant biotechnology in agriculture

Scope technology and act synergistically to improve AgResearch currently has two parallel and overall plant performance. Packaging this new closely interrelated programmes working on technology with HME will extend patent life to High Metabolisable Energy (HME) forages. 2035, adding an additional six years onto the One, which is funded through MBIE’s potential licensing revenues (and increasing Endeavour Fund with significant industry the opportunity for industry to gain a return on co-funding, will progress four lines of HME investment). ryegrass to US-based field trials and animal nutrition trials. These trials will assist the SSIF Platform: industry to determine if New Zealand-based Agri-Food Production field and animal nutrition trials will occur from 2021 by building a data package of information Key stakeholders and partners: to help define the value proposition for New Dairy NZ, PGG Wrightson, Grasslands Zealand. This SSIF supported programme will Technology Ltd, Ministry for Business, prepare commercial-ready HME forages for Innovation and Employment New Zealand-based field and animal nutrition trials scheduled for the spring of 2021. FY20 funding: $1,900,000 The SSIF programme will also progress a second technology that enables the Project timeline: enhancement of plant root systems. This has 2017 – 2022 been designed to be dovetailed with the HME

Project Epichloë endophytes for the future farm

Scope SSIF Platform: This project aims to improve pasture Agri-Food Production productivity and resilience by both reducing insect predation and improving plant access Key stakeholders and partners: to water and nutrients through healthier Endophyte Innovation, Grasslanz Technology root systems. This project has a number of Ltd., PGG Wrightson Seeds focus areas including the discovery of new Epichloë endophytes. We will also develop a FY20 funding: gene editing platform for Epichloë endophytes $2,000,000 using CRISPR-Cas9 technology to ensure that mammalian-toxic compounds are eliminated Project timeline: and useful bioactives are present. We will 2017 – 2022 continue our research to identify novel bioactive compounds that may be active against a broader range of insect pests and additionally confer improved drought resistance. Lastly this project will develop a deeper understanding of the barriers to production of efficacious concentrations of bioactive metabolites, and efficient transmission and longevity of the endophyte in seed. Prosperous land-based enterprises

22 Project Microbiomes: from soils to plate

Scope impacts of farming, plant and animal health The aim of this project is to bring together Soil- and sustainability, through to Plant-Animal Microbiome research to test the the attributes of food and bio-based products. hypothesis that the microbiomes in soil, plants, animals, and humans may be interlinked, and SSIF Platform: further, that they may be able to be managed Agri-Food Production, Premium Agri-Foods across the value chain for environmental, productive or other benefits. Key stakeholders and partners: Our Land & Water This project will bring together existing and new strands of microbiome work into a more FY20 funding: unified whole that will uncover synergies in $2,600,000 thinking, experimental approaches, methods, and analyses that will allow us to investigate Project timeline: microbiome interactions in areas as diverse as 2018 – 2020 soil functioning, plant breeding, animal health, and human functional foods.

The long term goal of this project is to link and describe the impact of microbiomes throughout the value chain in each of our major areas of interest, including environmental

Project Hitting targets for deer industry profitability

Scope from pests and diseases, maintaining the ‘five This project assists the New Zealand deer freedoms’ of animal welfare, and maintaining industry to achieve its aspirational targets the quality of soil, water, and atmosphere of for improvements in animal performance deer farms). and on-farm profitability, as espoused in its Productivity Improvement Programme (now SSIF Platform: embedded in the Passion- 2-Profit PGP project), Agri-Food Production over the next 10-year period, by providing science-based outputs to improve profitability Key stakeholders and partners: and environmental outcomes. The research DEEResearch, Landcorp, Deer Industry NZ, focus areas are driven by the Science Strategy Alliance Group, Passion to Profit Programme of DEEResearch (a joint venture between AgResearch and Deer Industry New Zealand) FY20 funding: These include: improving the profitability of $1,333,000 deer farming systems through optimising genetics, nutrition and reproduction to produce Project timeline: products desired by customers, protecting deer 2015 – 2022 Prosperous land-based enterprises

23 Project Research for innovation and impact

Scope SSIF Platform: The aim of this project is to provide the Agri-Food Production, Premium Agri-Foods knowledge and the practice that will enable researchers, within AgResearch and the national Key stakeholders and partners: and international innovation system, to take a Crown Research Institutes, CSIRO, MPI, MBIE more systemic approach in order to address complex research issues. It will enhance the FY20 funding: delivery of impact from research on complex $450,000 societal issues, and the communication of that impact. Through previous SSIF investment Project timeline: AgResearch has already developed research 2013 – 2020 and practice that uses agricultural innovation systems approaches to plan for research impact. This project will take the research and practice to the next level to embed a cultural change within AgResearch, and to influence that national and international science system. It will expand on the underpinning knowledge around interdisciplinary science and innovation systems and apply this to organisational change.

Project Māori Agribusiness research and engagement

Scope (Mātauranga Māori) with our science This project aims to support collaboration capabilities leading to a shared increase in between Māori partners, AgResearch, and capabilities and understanding. research collaborators through on-farm (e.g. integrating a kaitiakitanga framework and SSIF Platform: quadruple bottom line approach to land Agri-Food Production, Premium Agri-Foods use inventory) and off-farm projects (e.g. assessing the uniqueness and significance of Key stakeholders and partners: a Māori value chain that addresses particular Te Aranga, Ngāti Pahauwera, Prime Holdings, needs of those businesses). The project will Wi Pere Trust, Pakihiora Farms Ltd both demonstrate and develop AgResearch’s capabilities. FY20 funding: $650,000 Research collaborations between Māori partners, AgResearch and research Project timeline: collaborators will primarily focus on 2018 – 2020 strengthening capability, capacity, skills, and networks to increase understanding of how science can enable the aspirations of Māori partners. We will do this by co-developing our research with our Māori partners and research collaborators.Through this co- development process there will be an exchange and integration of traditional knowledge Prosperous land-based enterprises

24 Prosperous land-based enterprises

25 Added-value foods and bio-based products that meet consumer needs Science Plan Outcome

Added-value foods and bio-based products that meet consumer needs Added-value Ngā Tāngata

26 Project summaries FY20

Project Smart and sustainable bio-based products

Scope is competitive in the areas of sustainability, This programme delivers a balanced portfolio fitness for market, new products and process, of research aimed at delivering medium to personal and health care, and intrinsic benefits. long term outputs of strategic importance Elements are linked financially to the National within the established fibre industries and Science Challenge, Science for Technological emerging bioproduct sectors. The programme Innovation. seeks new high value uses from highly functional combinations of natural fibres, SSIF Platform: their components and protein sources from Premium Agri-Foods other primary sector values streams. Research objectives will deliver science outcomes from Key stakeholders and partners: longer term, potentially transformational, Science for Technological Innovation National fundamental science through to shorter term Science challenge agile and responsive science on issues of strategic importance to industry. We continue FY20 funding: to benchmark our research strategy against $2,000,000 the needs of industry through ongoing communications with our stakeholders and Project timeline: external contacts. 2013 – 2022

The objectives align to recommendations within the Textiles and Bio-based Products (TBBP) Roadmap to ensure New Zealand wool Added-value foods and bio-based products that meet consumer needs Added-value

27 Project Food integrity: doing the right things in a way that builds trust

Scope that New Zealand’s exports are safe, have For decades, big meant better; consumers defendable provenance, and produced in ways trusted brands they knew. Today, consumers that fit consumers’ values. are seeking authenticity and regulators demand more stringent compliance. People demand SSIF Platform: better information on how their food was made. Premium Agri-Foods They are looking for foods from companies who can demonstrate how they grow or raise Key stakeholders and partners: their food – from environmental practices Meat Industry Association Innovation, New to food safety, quality, and animal welfare. Zealand Food Safety Science & Research Consumers and government are looking for Centre, Ministry of Primary Industry, NZ Food sustainable practices around power usage, industries (DairyNZ, Oceania Dairy Ltd, Spring water quality, and reducing food wastage. Sheep Milk Co.) These consumer and regulatory drivers provide a definition of food integrity that focuses on FY20 funding: four common themes; transparency (how $2,142,000 foods are produced), provenance (where foods come from), assurance (food safety), Project timeline: and sustainability (reducing environmental 2015 – 2022 impact and waste). Food Integrity SSIF will deliver science outcomes that underpin the authenticity of these themes; to ensure

Project New values in pastoral ingredients

Scope and integrity of meat and milk, the sensory This project contributes research and experiences that consumers desire, and the innovation along the supply chain. We work wellbeing benefits that add value. It focusses with the agri‑food industry, taking a whole-of- on the precompetitive space, to identify lifecycle approach so every aspect of farmed points of New Zealand difference and develop livestock finds purpose. We aim to create new technologies and measurements supporting paths to next-users for pastoral products that agri-foods with functional benefits. are currently underutilised and employ meat and milk as ingredients in complex foods, SSIF Platform: exploiting their interactions at micro- and Premium Agri-Foods macro-scales. Key stakeholders and partners: This research is relevant: at the point of origin Meat and Livestock Australia Donor Company, to characterise the diversity and composition Meat Industry Association Innovation of raw materials, during processing to deliver University of British Columbia, Vancouver technology for differentiation leading to new foods and biomaterials, and for consumers FY20 funding: looking for novel enticing foods, especially in $1,542,000 prepared-meal formats. Project timeline: This project complements other SSIF 2013 – 2021 investments into the quality, performance, Added-value foods and bio-based products that meet consumer needs Added-value

28 Project Consumer experience: delivering customised meat attributes

Scope to deliver optimised sensory attributes from The economic sustainability of the meat Whole Muscle (Theme 2), Minimally Processed and dairy value webs that support the New Ground Muscle (Theme 3), and Meat Extracts Zealand economy depends on consolidated (Theme 4) that meet or exceed consumer and increased shares in the global food market. expectations. The pan-sector objective The ways consumers are interacting with food maximises the interaction with other internal are changing and their demands are becoming and external research programmes across more complex and dynamic, creating a more disciplines and enhances the engagement with challenging landscape for the interrelated meat stakeholders. and dairy sectors. Adding value to meat and meat products from New Zealand’s natural SSIF Platform: resources and creating new offerings that Premium Agri-Foods meet consumer needs are critical for the future success of these sectors. Key stakeholders and partners: Beef + Lamb NZ, Meat Industry Association, Consumer experience aims to develop meat Meat & Livestock Australia attributes and presentations that resonate with consumer preferences working on a consumer- FY20 funding: centric framework of five interconnected $1,161,000 themes and a pan-sector objective. Consumer-Product Interaction (Theme 1) and Project timeline: Transformative Technologies & Applications 2014 – 2020 (Theme 5) will enable information and tools

Project Systems nutrition for consumer well-being

Scope upper-class consumers in Asia. To excel at their This project aims to determine the cause and careers and contend with advancing age, these effect of food-health relationships by defining consumers will pay a premium for food and underlying biomarkers and mechanisms beverage products that help them feel physically of action relating to gastrointestinal and fit and mentally sharp. microbial interactions. The human microbiome profoundly affects food digestion and SSIF Platform: nutrient absorption and is increasingly seen Premium Agri-Foods as providing signalling molecules critical for gut-brain responses. Given the vast amounts Key stakeholders and partners: of human microbiome sequencing data High value Nutrition National Science available, surprisingly little is known about the Challenge, The Riddet Institute, Massey precise mechanisms by which these microbes University, Comvita, Glaxo-Smith-Kline interact with each other and the human host, and how food structures influence microbial FY20 funding: signalling and biology. The proposed research $1,895,000 will address this knowledge gap, ultimately providing evidence for foods targeted at so- Project timeline: called ‘Worried Well’ emerging middle- and 2014 – 2022 Added-value foods and bio-based products that meet consumer needs Added-value

29 Project The future of food

Scope digestive conditions. (5) Flavour development Sustainable processing and “food for life” will from the fat phase in food products. (6) New be the driving issues for the future of food uses for historically low-value by-products processing and consumption. Development in food manufacture and extraction of of emerging low-stringency technologies maximum value from these components. (7) to process low-value food by-products will Development of the underpinning science be used to produce new food ingredients to create non-dairy milk products by cellular and products with added value, and with expression of bovine proteins in yeast or less impact upon the environment and less bacterial cells and construction of the natural resource-usage. People are concerned with milk protein structures that are important mitigating the effects of ageing through when processing milk into dairy products. (8) targeted food consumption throughout their Changing on-farm practices to increase the whole life. The structure of food ingredients health and nutritional properties of milk. This and products can be re-designed using novel on-farm connection has the additional aspect and minimal food processing technologies of animal welfare by changing the weaning to maximise the delivery of health-conferring practices of calves from their mother. components that will enhance our quality of life. Research themes to be addressed SSIF Platform: include: (1) Sustainability issues when Premium Agri-Foods processing milk into dairy products, such as greenhouse gas emissions, resource usage, Key stakeholders and partners: and co-product transformations with added Riddet Institute, Teagasc, Institute of Materials value. Issues surrounding the sustainability Research and Engineering (IMRE) of the of plant- versus animal-based ingredient Agency for Science, Technology and Research processing will be explored. (2) Novel food (A*STAR), Dairy food processing companies ingredients and products targeting human senescence (anti-ageing strategies), taking a FY20 funding: human cell energy approach. (3) Leverage of $2,000,000 the protein functionality in dairy protein-based food products with plant proteins. (4) Impact Project timeline: of processing on altering food structures and 2019 – 2020 delivery of nutritional benefits under in vitro

Project Towards a circular bioeconomy

Scope Outcomes from this project will contribute to This project will bring together knowledge the rejuvenation of our primary sector to meet and capability from the whole of AgResearch national goals and international obligations. to tackle some of the most pressing issues facing this country. Research will focus on SSIF Platform: the following national and global challenges Agri-Food Production, Premium Agri-Foods related to sustainable future food and bio- based production systems: a) halving food- Key stakeholders and partners: system waste, b) transitioning to carbon TBC sink farming, and c) extracting maximum value from resources. This new project will FY20 funding: investigate novel technologies and strategies $2,000,000 to increase resource efficiency, reduce pollution to air and water, and produce more food and Project timeline: other bio-based products with minimised 2019 – 2020

Added-value foods and bio-based products that meet consumer needs Added-value inputs, environmental impact, and emissions.

30 Added-value foods and bio-based products that meet consumer needs Added-value

31 32 Integrated facilities for research excellence research excellence research excellence Integrated facilitiesfor • • The developmentwillsupportthefollowing; and students. food scientists, academics, researchers, the largestconcentrationofNewZealand’s the MasseyUniversitycampus, supporting and bio-basedproductsiswelladvanced on world’s mostsought-after, high-value food food science,alignedtothedeliveryof science, education,andinnovation centrefor The developmentofournationalresearch, Palmerston NorthFood ScienceHub refreshed strategy. the deliveryoftwopillars at Palmerston Northand Lincoln,alignedto science, education,andinnovation centres progressing tocreatenationalresearch, Two major investment streamsare talent andpartnerco-location. campus beingavibrantattractorforscience The fourcampusmodelreliesoneach farms portfolios. utilisation includingthefacilitiesand research deliveryandoptimisingresource collaboration iscriticaltoenablingenhanced research areastosupporttransdisciplinary location ofpeopleandscienceacross enduring andrelevant futurevalue, co- In transforming AgResearch todeliver balancing nationalandregionalpriorities. the fourcampusmodelindeliveringtostrategyand review hasbeenthereaffirmationofcriticality An importantpartofthe AgResearch strategic Research Centre New Zealand Food SafetyScience& Research andFonterra partners MasseyUniversity, Plant&Food and safetyincollaborationwith primary Centre ofexcellence forfoodscience and intensification, catchmentmanagement, water quality degradation,landusechange are mostacute,includingfresh andestuarine of thecountry’s foodproduction challenges New Zealand’s breadbasket, iswheremany In addition,Canterbury, long regardedas complimentary capability. Canterbury willincreasinglycontribute It isalsoexpectedthattheUniversityof Whenua andPlant&Food Research. to AgResearch, LincolnUniversity, Manaaki research, andscienceresourcesbelonging of acriticalmassrelevant education, the Lincolnprecinctisintersection This developmentrecognisesthefactthat use systems isbeingplannedfor Lincoln. world’s smartestandmostsustainable land research, alignedtothedeliveryof for land-basedfoodproductionsystems science, education,andinnovation centre The developmentofournationalresearch, Lincoln Precinct-Canterbury systems andprocesses. ways ofworkingandenhancedbusiness work underway tofacilitatetheexpectednew for completioninearly2020,withsignificant University JointFood Science Centre isdue The constructionofthe AgResearch -Massey • • •

the Manawatu Riverwater quality. central Northisland,includingfocusupon land useandenvironmental issuesinthe Regionally importantresearchinto National centreforanimalwelfareresearch gas researchandcollaboration National centreforagriculturalgreenhouse irrigation, water and nutrient allocation. Ruakura – Hamilton, Waikato This is recognised by many of New Zealand’s • Regionally important research into land use largest agribusiness enterprises and their and environmental issues in the upper international partners establishing increasing North Island presence in the region. • Environmental research focussed on water quality centred on the Waikato River, These factors provide the opportunity for Rotorua Lakes, and Lake Taupō our farms system research capability to be • Biosecurity (Ports of Tauranga and leveraged in more effective and impactful Auckland, and the impending Ruakura collaborations than in any other location. inland port) • Collaboration with existing co-located The development will support the following; entities and Innovation Waikato • The Lincoln precinct becoming the national • Collaboration with Waikato Tainui centre for land-based systems research bringing together the largest concentration Invermay – Mosgiel, Otago of focussed researchers and academics in • Regionally important research into land use the Southern Hemisphere and environmental issues in Otago and • The national Bio-Protection Centre – Southland, specifically focused upon water in collaboration with Lincoln University, quality and dairy intensification Manaaki Whenua, and Plant & Food • Supporting the Southern Dairy Hub (a Research partnership between AgResearch, DairyNZ • Our Land and Water National Science and the broader sector) to develop and Challenge – hosted by AgResearch demonstrate more sustainable production • Data Science, systems biology and systems precision agriculture • Specific research to support hill country • Forage seed production sheep and beef production systems • Regionally important research into land use • The national centre for deer research and environmental issues in Canterbury • Collaboration with existing and the and the upper South island expansion of co-located entities • Collaboration with Ngāi Tahu. • Closer collaboration with the University of Otago, focused upon environmental The two major developments will be and sustainability research, and including supported by two critical regional campuses, the Otago Centre for Sustainability and the in which AgResearch will continue to invest Otago Energy Research Centre. to support specific research focus areas. Integrated facilities for research excellence

33 Māori Agribusiness

At AgResearch we recognise that our partners are distinctive because their whakapapa, values, and obligations to the people. The whenua propels Māori businesses towards something different – a supply chain based on Whakapapa, Rangatiratanga, Kaitiakitanga, Whanaungatanga and Manaakitanga.

This is a uniquely Māori business ethos reflecting This will enable the indigenous story to be taken indigenous value systems that aims to move to the global market place, underpinned by Māori Agribusinesses beyond business as usual, authenticity and the ethic of kaitiaki. while providing for communities, reaffirming their Not unlike many New Zealand farmers, culture and honouring their obligations as kaitiaki. our partners have identified that they want This pathway builds opportunity for New Zealand ownership of the product from the paddock at large. As AgResearch innovates alongside to the plate, to have a direct relationship with Māori partners developing new indigenous fibre their national and international customers, and meat values-based supply chains, we have and to increase the transparency within the formed three key Māori Agribusiness research supply chain, therefore spreading the risk themes to underpin R&D needs. and returning the wealth to their people.

Māori Agribusiness Research Themes: But where we at AgResearch add value is • decision-making recognising that unique to Māori Agribusinesses • land use diversification are the aims to produce food and engage with • value chain. the whenua in a way that honours Māori values, that maintains and restores mauri, and the Increasing numbers of our Māori Agribusiness health of land and waters. partners are asking AgResearch to co-develop research and development projects that will help This is an exciting area of development and we extend business operations and interests beyond look forward to growing our partnerships and

Māori Agribusiness Māori production into processing and marketing. connection with the Māori Agribusiness sector.

34 Māori Agribusiness Project summary Project summary FY20

Project Kaitiaki Farm Plan

Scope The project focuses on training of two senior appreciation for, a unique Te Ao Māori. science cohorts in concepts of kaitiaki as it This project is enabling the researchers and relates across multiple outcomes of Māori Māori partners to co-develop new tools and communities, nga uri whakaheke (future apply the knowledge to their individual needs. generations), marae and kainga, whenua (land and environment), and new target markets. Investment area: Utilising these concepts, the researchers are MBIE Vision Mātauranga Capability Fund/ working with Māori stakeholders to develop AgResearch SSIF kaitiaki based farm plans that respond to the broader cultural and economic needs of Māori Key stakeholders and partners: land owners. Nga Uri o Te Ngahere Trust, Prime Holdings Ltd, MBIE The goal is to make significant and lasting impacts for Māori through building the FY20 funding: capacity of landowners and trustees to enhance $120,000 resource stewardship and unlock the potential of their whenua-based assets. Particularly Project timeline: important is taking a whole systems approach 2017 – 2019 that considers multiple values and can explore novel enterprises suited to small land units.

For AgResearch researchers to meaningfully assist with these goals, it is critical to build

capability with a deep understanding of, and Agribusiness Māori

35 Vision Mātauranga

“To unlock the innovation potential of Māori knowledge, resources, and people to assist New Zealanders to create a better future.”

He nui whakaharahara te mahi a AgResearch AgResearch has a significant part to play ki te whakatutuki i ngā whakakitenga in the delivery of Vision Mātauranga to mātauranga ki te motu nei, ko te matua kia New Zealand, particularly in the support of tautoko ai i ngā huatau tiketike, i te oranga its indigenous innovation, environmental whenua me ngā whāinga taumata angitu o te sustainability, and indigenous knowledge mātauranga iwi tiketike. growth goals.

Ki te whakatutukitia, kia toru ngā kaupapa To achieve this, three priorities have been mātua hei pou whirinaki kia taea ai ngā identified to better enable the delivery of kōwhiringa auaha te whakataki: opportunities for innovation;

• tāria te raukaha kia whakatutukitia te • build capacity to engage with and whakawhiti whakaaro, te whakawhiti deliver research outputs to Māori rangahau me Ngāi Māori • develop meaningful relationships • whakawhanaketia ngā tātai hononga with Māori ki a Ngāi Māori • develop research programmes that • whakawhanaketia ngā rautaki rangahau meet the needs of Māori. kia whai i ngā hiahia nō Ngāi Māori. Our challenge is to bridge a communication Ko tō mātou wero kia kāpia te anga gap between Māori and the sector and to kōrerorero nō te rāngai ahuwhenua nei ki a develop long-term relationships. Ngāi Māori, kia whakawhanaketia hoki ngā hononga motuhake. It means a re-focusing of the way we partner with Māori entities – ways that are more Kia tika ai ngā hononga ki a Ngāi Māori, mā in tune with the way Māori make decisions. mātou anō ngā whāinga o Ngāi Māori e whai. Two strategies are better than one. E mate kāinga tahi, e kāinga rua. We are ensuring that AgResearch has the knowledge and skills to deliver on Ka whai a AgResearch i te mātauranga me AgResearch’s Māori specific impacts through ngā pūkenga o te ahuwhenua Māori ki te learning and development initiatives. whakapuakihia nā te mahi whakaako, nā te whaiaro whanaketanga. As the Māori proverb, ‘With the right roots, the Kāhikatea can withstand E ai ki te whakataukī, Mā ngā pakiaka the storm’ explains, if we wrap tū ai te Kāhikatea i te uru”, ki te ourselves with the right support at tākaia ngā kōeke katoa o tō tātou every level of the organisation we will whakahaerenga e ngā tautokotanga have impact and visibility.

Vision Mātauranga Vision tika, ka kitea ngā hua papai nō tātou.

36 Vision Mātauranga Vision

37 Our people

The successful delivery of our new Science Plan will only be achieved by ensuring that we have the right people doing the right work, in the right place, at the right time.

AgResearch has a new Science Plan and we science priorities must ensure that we have the right people, with • mentoring programme the right capability to deliver on that plan. We • Mātauranga Māori (MM). are supporting this objective through the work we are undertaking on; Our new facilities at Massey and Lincoln • attraction, recruitment, and retention Universities present an exciting opportunity strategies for our people to work in modern lab and work • leadership development environments but more importantly these • developing a diversity and equity programme buildings will be the catalyst for us to fully • change management framework realise our New Ways of Working (NWOW). • workforce planning Our NWOW philosophy encompasses enabling • talent / succession management technology, enhanced collaboration practices • the implementation of a Human Resources and spaces, increased efficiency, streamlined Information System (HRIS) processes, a greater integration of Mātauranga • enhancing our employee experience Māori into our ‘every day’ and enhanced well- • research capability mapping to ensure being for our people. that our future science knowledge and experience will continue to meet emerging

Our people Ngā Tāngata

38 AgResearch staff:

374 Female 324 Male

AgResearch has a key focus on our culture Our employees value and celebrate our and the engagement of our people. We are workforce diversity and appreciate the flexibility working closely with our science teams on that working for AgResearch offers them. Our strategies and initiatives that will engage a employee support programme is extensive and research population. A critical focus remains is aimed at providing counselling and other the bringing to life of Our Values across the services to help our employees through those organisation. difficult times in life. This goal is also supported by the income protection and life insurance This culture work is further supported by a benefits that AgResearch extends to our full- comprehensive learning and development time employees which offer the ultimate peace programme which is fully aligned to of mind - when times get tough. organisational strategy and includes a leadership development programme which is The implementation of HRIS will allow line intended to develop a range of stakeholders, managers to have a single source of truth and from our emerging leaders to our Executive a comprehensive array of employee data at Team. We are currently developing a ‘whole their fingertips. The system functionality will person’ leadership initiative which, when automate many current manual processes launched, will cascade into our supporting and is intended to support increased efficiency systems and processes like Science Career and a higher level of productivity in the people Descriptors, our Promotions process, our management space. Remuneration Framework etc.

Our Values represent the attributes that are innate to those who will drive the success of our organisation. Our People

3939 40 Aligned to government priorities priorities government to Aligned management, and biosecurity. biosecurity. and management, systems, including addressing production, land that can sustainably transform New Zealand’s agricultural and expectations set by government. We pursue activities Our science investments run in parallel to the framework accompanying societalexpectationsrequires in therapidlyevolvingscience sectorand demand oftheglobalmarketplace. Changes science thatissolutions-driven andmeetsthe Zealanders through innovative andsustainable impact andenhancingthewell-being ofallNew Purpose. Ourresearchfocusesondelivering these prioritiesremainattheheartofourCore Advisory Panel, andgovernment, ensuring and globalcollaborators, byour Science framework isinformedbyregional,national AgResearch’s focusanddirectionwithinthis New Zealanders. improved economicreturntoNewZealand and responsibility, regionalprosperity, aswellthe impact, socialacceptability, ethicalandcultural and informedresearchincludeenvironmental primary productionthatisbasedonscience the challengesofsustainablefarmsystems and The elementsconsideredinourapproachto NZ Food SafetyResearch &Science Centre, Science Challenges, initiatives suchasthe national andglobalorganisations, theNational through ourcollaborationwith regional, meet market demands. This isdemonstrated trends tosupportouragriindustry partnersto arrangements tomeetthesecurrentandfuture actively involved incatalysing newcollaborative priorities andcapabilityrequirements. We are land-basedresearch tastes, influencing products, economic, socialandconsumer Current andemergingtrendsaredrivingagri- public good. research opportunitiesforcommercialand of communities, andmeeting identifying social sciencemeetingthecomplexchallenges bio-based foodproducts, premiumproducts, capability thatfocusesonagri-technology, AgResearch hasabroadandmulti-disciplinary the supportofagile,high-qualityresearch. Niho Taniwha researchers includesresearchinvaccines and leading internationalandNewZealand based emissions AgResearch’s collaborationwith In linewiththegovernment’s directiontolower Carbon Bill(ZCB)tobetaken intoaccount. outcomes ofthegovernment’s proposedZero Agreement onclimatechange,andincludethe of NewZealand’s commitmenttotheParis to anetzeroemissionseconomy insupport change policyandNewZealand’s transition three fundamentalobjectivesforclimate Our researchisalignedtothegovernment’s foods. demand forpremiumproductsandinnovative globalconsumer industry partnerstosatisfy research capabilityandexpertiseenablesour focused engagementandourprovision of and environmental sustainability. Ourindustry- areas ofprimaryproduction,climatechange, making inregionalandnationalpolicythe Our high-qualityscienceinformsdecision- revenue returnedtoNewZealand. and deliveringimpactintermsofexport industries tohighervalue productsandexports includes transitioningNewZealand’s primary partners fromtheprivate sector. Ourfocus team, alongwithcommercialisation Innovation, MBIE’s Innovative Partnerships collaborating withinnovation brokers Callaghan of projectsandprograms. management, andmonitoringevaluation professional projectmanagementsystems, risk for theimprovement inperformancethrough planning forimpactandmanagementsystems New Zealand’s researchsector. This includes building expertise,capability, andcapacityfor this includesundertakingactivitiessuchas in revolutionisingtheprimarysectorand AgResearch understandstheresearchneeds as sheepandgoatdairymilk. introducing novel methodsandproducts, such our economy supportinglandscapesand consumer demandsandtheneedtodiversify chain. Ourresearchinvestment iscognisantof products, andcapturingvalue alongthevalue driven exportstovalue addedpremium export base,progressingfromcommodity enable andsupportthediversificationofour new land-basedenterprisesandpracticesthat profitable premiumproduction,supporting on sustainablytransformingagriculturalfor on emissions. OurSciencePlanisfocused helping frameinternationalunderstanding Livestock EmissionsResearch (GPLER), participation intheGlobalPartnerships in Research Alliance (GRA)andenablesour other researcherssupportstheGovernment in soilandpasture.Ourcollaborationwith inhibitors, nitrogenfixing, andcarbonstorage 41 Aligned to government priorities Sustainable future roadmap

The Climate Change Response (Zero Carbon) Amendment Bill sets out the government’s plan for the next 30 years, including new emissions reduction targets for all greenhouse gases in line with New Zealand's commitments under the Paris Agreement.

As a Crown Research Institute, AgResearch fuels To implement innovative long-term solutions, and innovation and new market creation in the field of embed sustainability within our business, we are land-based research and is a key contributor and focused on transitioning to strategic, systematic, sponsor of research that will reduce emissions and integrated core business processes that are from agriculture and provide forewarning of the deeply aligned to our sustainability vision and impacts of climate change in pastoral agriculture. organisational values.

But we acknowledge that aspects of our business With the government’s zero carbon aspirations at can have both positive and negative impacts front of mind, AgResearch will be using science- on the environment. Our vision is that our based target setting methods to develop carbon management of the environment is consistent reduction targets to ensure the transformational with our level of innovation and improvement in action we take going forward is aligned with science research and that we are directors and current climate science. influencers of positive environmental change. By moving environmental sustainability from a In turning a critical eye to our own environmental peripheral concern to one that is at the core of performance AgResearch has engaged Enviro-Mark our business, we are uniting our desire to improve Solutions CEMARS, a world-leading independent economic performance with our ability to make a carbon emission management and reduction difference to climate resilience right now. scheme, to ensure that our Sustainability Strategy and emissions reduction targets are both science-

Sustainable Future Roadmap Sustainable Future based and business tested.

42 Sustainable Future Roadmap Sustainable Future

43 44 Financial Statements Financials 2019 –2024 45 Financial Statements 46 Financial results Financial Performance Indicators Financial Performance forthe6yearsended30June2024 performance Overview ofprojectedfinancial projected nominalsurpluses. some campusdevelopments,furtherdevelopmentisbudgetedthroughtoFY2024returning At asurplusbeforetaxlevelthegroupisforecastinglossesthroughtoFY2021asitcompletes from FY2021. shows theoperatingrevenuefromFY2019throughtoFY2024,showinganormalisedposition The financialresultsshowmodestgrowththroughouttheforecastperiod.Thefollowingtable 2019 –2024 Financial results Equity Ratio Capital Renewal Adjusted Return onEquity Forecasting Risk% Operating Margin Volatility (FC/TC) Interest Coverage Quick Ratio Revenue Growth Operating MarginperFTE Operating Margin Ratios Total Equity Surplus (deficit)beforetax EBITDA Cashflow Operating revenue Type Financial year Type Financial year Cash attheendofyear of theyear Cash atthebeginning Total netcashflow Effect ofexchange ratechanges financing activities Net cashflow from investing activities Net cashflow from operating activities Net cashflow from Forecast Forecast (19,453) (24,520) 240,526 157,037 (8,282) (4,867) (5.8%) 21,795 46,315 11,218 $000’s 81.8% 23.9% (200) 9.0% 0.5% 2019 2019 (0.8) 1.5 1.2 (16,860) 237,297 155,182 Budget Budget (4,484) (7,384) (2.4%) (1.2%) (1.3%) 14,412 21,795 10,080 $000’s 82.7% 25.2% 9,476 2020 2020 (3.0) 7.7 1.5 - Projected Projected (24,014) 239,386 156,632 16,645 14,412 13,420 26,247 $000’s 79.0% 26.7% 2,234 2,901 1.5% 0.9% 1.4% 2021 2021 (2.9) 1.1 3.4 - Projected Projected (69,140) (16,145) 241,244 157,869 16,645 39,243 13,859 13,752 $000’s 70.1% 26.7% 2,581 1.3% 0.8% 1.7% 2022 2022 38.5 500 0.7 4.0 Projected Projected (15,006) 242,440 162,760 16,253 14,158 $000’s 70.0% 26.9% 1,661 0.9% 3.1% 2.0% 2023 2023 500 500 849 2.0 0.8 5.0 (0) Projected Projected (11,522) 242,629 166,079 (3,485) 15,692 15,007 $000’s 70.7% 29.8% 0.1% 2.0% 1.1% 2024 2024 500 500 263 1.2 0.8 2.7 0 responsible manner. for purposefacilitiesinthemostfiscally with theobjectiveofdeliveringbestfit development arecontinuingtobeassessed ownership andfundingmodelsfortheLincoln development fortheproject,alternative As partofthesinglestagebusinesscase the Lincolnfacilitydevelopment. around theownershipandfundingmodelfor projections utiliseabasecaseassumption Note: Itshouldbenotedthatthefinancial Net Cash/(Debt) Position ($50m) ($40m) ($30m) ($20m) ($10m) $10m $20m $30m $0m Forecast 2019 Budget 2020 Projected 2021 Projected 2022 Projected 2023 Projected 2024 47 Financial results 48 Non-financial targets 1.8 1.7 1.6 1.5 1.4 1.3 1.2 1.1 ID 2019 –2024 Non-financial targets AgResearch-specific indicatorsofEnd-UserEngagementandScience Relevance Indicators Core Operating ID G.1 G.2 G.3 G.4 G.5 stakeholders Revenue from Engagement Internal Stakeholder Engagement External Stakeholder Indicator Indicator End usercollaboration Research collaboration knowledge transfer Technology & Science quality Financial indicator rating. Contribution toStakeholder Strategy–“Goodor“Better” Familiarity withourCapability –“Very Familiar” rating. Dealing withUs–“Preferenceto Work” rating. satisfaction rating. Satisfaction withourService–“Very Good”or“Better” or “Better”satisfactionrating. Stakeholder Relationship measure –“Very Good” e) international revenue; f) Māorirevenue. e) internationalrevenue;f) c) commercialrevenue;d)IP a) totalrevenue;b)netscience / InteractionPlan. Consistent implementationofagreedScienceService Services Plans. Consistent implementationofagreedStakeholder Definition Definition Revenue perFTEfromcommercialsources. international authors). authors ord)withacombinationofNewZealand and b) withotherNewZealand authors, c)withinternational publications witha)only AgResearch authors, Publications withcollaborators(Percentage of Commercial reportsperscientistFTE. 2014 calendaryear). publications ineachjournal. The referencefigureisforthe during theyear, weightedbythenumberof AgResearch assessed bySCImagoinwhich AgResearch staffpublished of 2-yearcitationsperdocumentforscientificjournals Impact ofscientificpublications. (The average value Revenue perFTE,basedonaverage FTEsover theyear. FY20 target $115.9k d) 21% c) 26% b) 39% a) 14% 1 2.7 $225.4k >90% >40% >60% >70% >60% f) $0.335m f) e) $4.07m d) $10.9m c) $54.7m b) $114.6m a) $155.4m Achieved Achieved FY20 target FY18 actual $121.8k 22% 32% 36% 10% 1.25 2.99 $229.6k 83% 32% 68% 64% 58% f) $0.279m f) e) $3.2m d) $11.03m c) $48.6m b) $105.2m a) $145.8m Achieved Achieved FY18 result ID AgResearch-specific Operating IndicatorofDeliverytoAgResearch-specific Operating VisionMātauranga ID performance AgResearch-specific financial ID AgResearch-specific workforceindicators 4.1 3.1 3.2 3.3 2.1 Indicator Indicator Indicator Financial Target Staff engagement Health &Safety with HealthandSafety Employee engagement Collaboration withMāori Definition Definition Definition Operating Profitbudgetachieved. Increase EngagementIndex(EI)by5points. No notifiableinjuriesand<2events. AgResearch increaseswith>75%score. Employee engagementindexofHealth&Safetywithin co-developing fundingproposalswithstakeholders. Cultivate collaborationtosupportMāoriagribusinessby FY20 target FY20 target Achieved 70% <2% >75% FY20 target 6 FY18 result FY18 result Achieved 65% 0% 75% FY18 result 6 49 Non-financial targets 50 Miscellaneous items Miscellaneous items • • • These include: Quarterly Reports throughout theyear: with thefollowing documentsandinformation AgResearch provides ShareholdingMinisters financial year Shareholding Ministersduringthe providedtothe Information tobe the yearending30June2019. It isforecastthatnodividendswillbepaidin retention ofimportantcapabilities)exist. commercialisation, capitalexpenditureandthe opportunities (includingreinvestment, of adividendwhennosoundinvestment surplus cashtoshareholdersintheform The Company’s policyisthatitwillreturn dividend, ifany Principles indeterminingtheannual the 2017 Annual Report. material changesinaccountingpoliciessince at www.agresearch.co.nz. There have beenno Policies isprovided on AgResearch’s website as appropriate. A fullStatementof Accounting other applicablefinancialreportingstandards Financial Reporting Standards(NZIFRS)and the NewZealand Equivalents toInternational this StatementofCorporate Intent,complywith including thefinancialinformationpresentedin Zealand (NZGAAP). The financialstatements, Generally Accepted Accounting PracticeinNew Act 1992,thePublicFinance Act 1989,and Act 2013,theCrown Research Institutes Companies Act 1993,theFinancialReporting in accordancewiththerequirementsof AgResearch’s financialstatementsareprepared AgResearch’s accountingpolicies business plans. comparisons ofsuchachievements with Comment onresearchachievements and on financialactivitiesforthe quarter Comparisons withbudgetsand comments Financial statements • • • • • each financialyear. Init,theBoardsetsout: Ministers withinthreemonthsoftheend AgResearch isdeliveredtotheShareholding An Annual Report oftheoperations Annual Report • • • • • • This includes: Half- a goodemployer A reporton AgResearch’s performanceas A statementofresponsibility statements The auditors’reportonthese financial financial period Comparative informationfortheprevious for thefinancialyear, consistingof: Audited consolidatedfinancialstatements (financial andnon-financial). achieving annualperformancetargets Commentary onprogresstowards Companies1993 Act Research Institutes Act 1992andthe principles setoutinSection5oftheCrown during theperiodinaccordancewith A statementthattheCRIhasoperated A statementofresponsibility performance fortheperiod Commentary onoperationsandoverall period ofthepreviousfinancialyear Comparative figuresforthecorresponding year, withintwomonthsofthehalfyear (including accountingpolicies)forthehalf Unaudited financialstatementsandnotes • • • Year Report position attheendofperiod the financialyearandtheir AgResearch anditssubsidiariesduring financial resultsoftheoperations as maybenecessarytoshow the policies andsuchotherstatements contingent liabilities, accounting Statements ofcommitments, beginning oftheyearinSCI);and including budget(asestablishedatthe comprehensive incomeandcashflows, Statements offinancialposition, AgResearch anditssubsidiaries A reportoftheoperations • • than $5minvolving: transactions withavalue equivalent toorgreater written consentforany transaction or seriesof greater than$10m. The Boardwillobtainprior other assetswithavalue equivalent toor (buildings, land, andcapitalequipment) acquisition, disposalormodificationofproperty series oftransactionsinvolving afullorpartial Shareholding Ministersforany transactionor The Boardwillobtainpriorwrittenconsentfrom • • • not acquire: Research Institutes Act 1992, AgResearch will As requiredbysection13(1)(d)oftheCrown or otherorganisation or otherwiseacquiressharesinany company for,of thegroupsubscribes purchases, any followedbefore member tobe Procedures Companies1993. Act Crown Research Institutes Act 1992andthe Public Finance Act 1989,Section17ofthe annual reportingprovisions inPart V ofthe The Annual Report willcomplywiththe • • • the investment transaction), and the investors shallbevalued atthetimeof interests atafuturedatethe directionof clauses thatcompel AgResearch tosell transactions whichinclude“drag-along” ownership ofanother entity(provided that ownership ofasubsidiaryorsubsidiary’s Transactions thataffectacompany’s external company orbusinessunit part, ofsharesorinterestsinasubsidiary, The acquisitionordisposal,infull shareholding Ministers. shares, writtennoticetothe except after An interestinacompany otherthaninits venture, orotherassociationofpersons, or An interestinany partnership,joint or over acompany Shares thatgiveitsubstantialinfluencein Shareholding Ministers. A responsetoany directiongivenbythe SCI performance indicatortargetssetinthe A reportagainstfinancialandnon-financial A corporatesocialresponsibilityreport intangible propertyrights. fair value. AgResearch doesnotrevalue its book value maynotreflecttheircurrent market andotherfactorsindicatetheirstated every threeyears, ormorefrequentlywhere its land,landimprovements, andbuildings value. The BoardnotethattheGrouprevalues reasonable approximation ofthecommercial NZ GAAPwhichtheBoardconsidersisa Group equitypositondeterminedunder This value isbasedsolelyontheforecasted value oftheGroupisapproximately $230m. The Board’s estimateofthecurrentcommercial Current commercialvalueof AgResearch been soughtfromthegovernment. At thedateofthisSCI,nocompensationhas fromtheCrown compensation seeksActivities forwhichtheboard Ministers and AgResearch fromtimetotime. with noticerequirementsagreedbetweenthe activities below thisthresholdinaccordance related topropertyandcommercialisation in writingbeforeenteringintoany transaction The BoardwilladviseShareholdingMinisters • capabilities. material effectonthecompany’s science core businessorthatmayhave a scope ofthedefinitioncompany’s Other transactionsthatfalloutsidethe 51 Miscellaneous items 52 Financial Statements 53 Financial Statements 54 Financial Statements www.agresearch.co.nz 3809 3489 T +64 Mosgiel 9053 50034 Bag Private 9092 Mosgiel 176 Alley Puddle Centre Invermay Agricultural 6351T +64 8600 Hopkirk 6356 8019T +64 Grasslands 4442 North Palmerston 11008 Bag Private 4410 North Palmerston Tennent Drive Institute Research and Hopkirk Centre Research Grasslands 2836 7856 T +64 3240 Hamilton 3123 Bag Private 3214Hamilton 10 Road Bisley Centre Research Ruakura 3321T +64 8800 8140 Christchurch 4749 Bag Private Lincoln 7674 1365 Road Springs Lincoln Centre Research and Office Corporate 224 NZBN: 038 966 9429 Limited AgResearch