Source: Radio New Zealand
Silver Fern Farms attributed the turnaround to strong international red meat demand, tight cost controls and deferred investment into projects like factory automation. RNZ / Nate McKinnon
One of New Zealand’s largest red meat companies is back in the black after a few years of financial losses.
But Silver Ferns Farms is also counting the costs of halting exports into its key Persian Gulf markets.
The firm with 14 meat processing plants across Aotearoa reported a profit after tax of $29.1 million for the 2025 financial year, up from a $21.8m loss the previous year, and a $24m loss in 2023.
The company has seven global outposts and attributed the nearly $51m turnaround to strong international red meat demand, tight cost controls and deferred investment into projects like factory automation.
Exports to Persian Gulf halted, for now
But its agility was being tested by war in the Persian Gulf, as for other primary sector exporters.
Twelve percent of Silver Fern Farm’s lamb and up to 5 percent of its beef went into Gulf states, that it entered via the embattled Strait of Hormuz, into key markets, including the United Arab Emirates and Saudi Arabia.
When the conflict broke out in late February, it had 140 containers in-transit destined for the Middle East.
Silver Fern Farms chief executive Dan Boulton said most containers were able to be moved through other ports, though some still awaited documentation requirements on-port, and it diverted some product to other markets entirely.
He said it paused production into the Middle East, until it had clarity.
“As soon as the conflict started and we knew we were having issues, we made that decision to halt all production until we had transparency around what our options are.
“We’ll slowly resume production once we get certainty around supply chains back into that sector.”
Boulton said it was working with its supply chain partners like Kotahi to keep product moving into the important region.
He said it was looking at creative solutions to ensure it could continue to supply product into the region, including considering air freight options and diverting via the Mediterranean Sea and down through the Suez Canal.
“So it’s obviously a longer transit time. But what’s important is that we continue to service our customers.
“But that will come at additional costs, which we’re working with our customers on.”
Securing livestock supply when margins are tight
Boulton said 2025 was a hard-fought year for the company dealing with low livestock volumes.
“Though we’ve delivered a great result, there’ve still been quite tight margins,” he said.
The company tightened its purse strings these past few years, and cost control measures saw it cut full-time roles and seasonal lay-offs across its sites.
Boulton said tighter supply and high procurement costs put pressure on its ability to run the plants efficiently, on investment opportunities and its processing margins.
“We’ve had to fix capacity on and off, shift structures and longer seasonal layoffs,” he said.
“That’s been tough, but that’s what we’ve had to do to reduce our operating costs, in the light of the livestock numbers.”
Meanwhile, farmers were earning top dollar from processors for their stock, but Boulton said he expected farmgate prices to come off their highs.
“We’ll see as market conditions change that there’ll be a little bit more of that retained within processing, so we can invest in the processing sector and invest in the market.
“I don’t see farmgate prices easing dramatically too much based on long-term demand, I just see a little bit of the top coming out as capacity rebalances with supply.”
The company gained new commercial partnerships, and revenue jumped $409m on 2024 to more than $3 billion this year.
Livestock numbers were down 6 percent in 2025, and through the first quarter of this year, the cull was down 18 percent for beef and 12 percent for lamb, he said.
Boulton expected many livestock were being deferred making for a busy quarter two ahead.
Meanwhile, the Silver Fern Farms Co-operative earned $14.2m in financial year 2025, up from a $10.9m loss the year before.
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– Published by EveningReport.nz and AsiaPacificReport.nz, see: MIL OSI in partnership with Radio New Zealand
