 Thank you for the opportunity to speak with you today and to make what I hope is a useful contribution to the overall theme of Outlook 2016 investing in agriculture growing our future, but more specifically this session investing in innovation despite uncertainty. I once heard an interesting comment by a HR director of a business that was investing heavily in training their staff only to find that many of those staff ultimately left the business and when line managers were complaining and saying what if we invest in training them and leave the HR director responded what if we don't and they stay. So investing in innovation I think is a bit like this in times of rapid change whilst it's not always possible to predict what will happen in the future I think there are in fact quite a few things that we can be certain about rather than uncertain. Firstly consumers have changed they know more and they expect more and they have more choices they demand products and services that meet their needs and not ours competitors are changing they're more of them and they're becoming smarter and more proactive sadly Australia no longer sits in the number one position for red meat exports as it did when I first joined the industry. Technology is changing and changing rapidly there are now more ways to automate to analyze and exchange information and to make better decisions faster and markets themselves are changing with new regulations trade agreements and populations that are shifting and have aspirations to have access to safe and healthy food to feed their families. So we know these changes are complex chaotic and even uncertain but what what if we don't invest in this future most of you will be quite familiar with MLA and what we do our job is to work with industry and government partners to try and make sense of this uncertain future and to determine those areas of investment in both innovation and marketing that will deliver the greatest return. My presentation today will focus particularly on how MLA is using deep insights to help our industry to uncover new innovation and growth opportunities. In addition to investing levy funds in innovation MLA also has the opportunity to co-invest additional matching Commonwealth funds via voluntary contributions from external parties. We do this via MLA donor company or MDC as we call it which is a fully owned subsidiary of MLA. These funds are invested in a wide range of innovation projects as you can see here that deliver benefit across the industry and fundamentally what we're trying to invest in is the development of new technologies and and processes and building industries capability. I was very interested this morning to hear how adoption of new technology is one of the things that's going to make our sectors more investment ready and I think this is one of the things that we're particularly interested in looking at through our donor company mechanisms. Currently we have a portfolio in excess of a hundred million dollars in the donor company and expenditure this year will be about 32 to 35 million dollars. It is important to note that no MLA producer levies are invested in these projects. MDC as I said provides our industry with a fantastic opportunity to increase their investment in innovation while at the same time reducing some of the risk and uncertainty. It also provides us at MLA with clear signals about innovation priorities and reduces the adoption risks via the direct engagement of commercial partners. I'd now like to provide you with a brief snapshot of how MLA is planning to extend our global innovation strategies so as to support the industry to capture high value growth in emerging markets over the next three to five years. MLA's global innovation investment framework is based on three key pillars. At the centre is market access which is fundamental to securing the industry's long-term competitive position. Our programs support governments efforts to open new markets and to reduce tariff disadvantages such was achieved with the recent free trade agreements with Japan, Korea and China. We also invest in food safety research to ensure our industry is at the forefront of scientific and technical advances and can provide credible evidence to counteract technical barriers to trade. The aim of our market intelligence and insights program is to ensure that industry and commercial partners have the best possible information to underpin trade and business development in market promotions and brands, developing new premium products, ensuring our integrity systems meet customer expectations and more recently in designing new business models that allow us to move further up the chain and capture more value. I think we all know that there are significant opportunities for Australia's agri-food industries to capture advantage from the rapidly growing markets in our region. Many analysts in fact believe that this is a once in a lifetime opportunity and if we don't get this right our competitors will simply run over the top of us and our hard-won competitive advantage will be lost. In 2015 MLA was fortunate to be awarded a grant under the Rural R&D for profit program, a particular initiative of our Deputy Prime Minister to fund a project which has the specific aim of making sure that producers and their value chain partners have access to deep knowledge and insights that will help them make better decisions about where to invest to grow their businesses. MLA is leading this project which is a collaboration across six sectors involving red meat, horticulture, dairy, seafood, wine and pork. Our target is very much about discovering the what's next, the second horizon. We know we need to make smart innovation investment decisions now across a range of areas that you see here. If we are to help the industry sustain strong growth in value more than volume over this next three to five year period and belong beyond. For this project we've identified a number of key targets for the development of these global innovation investment strategies. China which is probably the obvious one, Southeast Asia which is clearly more fragmented one and the Middle East which is perhaps for some the more mysterious one. And there are also some market segments which whilst very visible have been virtually ignored by consumer researchers and innovation planners to date. One of these is the ageing population which is rapidly changing and it's not only a growing force in Australia it's also likely to become a dominant segment in some key markets such as China and Japan. This segment has very different expectations and requirements from the food that they consume and purchase and we need to start thinking about how we're going to service their needs. I should say our needs in many cases. What I would like to do now is to briefly give you a flavour of how we are using insights to reduce some of the uncertainties about where to invest in innovation to drive high value growth in China. This is just as an example and we're doing the same sort of thing in those other markets and segments that I described. We all know that the growth of the urban middle class in China is huge and that Chinese consumers appear to be willing to adopt new food trends, Western diets and that they favour imported products at least for now. But what can we do with this information? What does it tell us in terms of investments in innovation? Clearly our agri-food industries cannot hope to satisfy all of the demand in China and nor would they want to if this meant giving up our long-term stable markets elsewhere. Some say we should position ourselves as the delicatessen of Asia which simply means targeting niche segments with premium innovative products. But this still doesn't really provide our commercial value chains with enough information to guide their investments or growth strategies. So what have our China deep dive insights revealed so far? Clearly while China is one country it is in fact made up of many different markets and a simplistic one-size-fits-all approach won't work. There are many different supply chains operating and emerging within China from simple models such as you see here with all of the obvious cold chain challenges right through to one of the most sophisticated e-commerce food environments in the world with complex logistics challenges that are still being sorted out. Many of these challenges may appear to present insurmountable constraints particularly if we apply Western thinking. But if we adopt a new lens they could also present us with first mover advantages if we explore innovative new design-led solutions. What is obvious is that simply trying to sell our products into this market is unlikely to win us a position. The food marketplace in China will continue to evolve and is likely to become a unique blend between the status of Western brands combined with the attributes that address deeply held cultural preferences and traditions. The green tea cakes that you find in Starbucks in Shanghai for example. These are nuances that we must become the best at understanding and servicing. So in response to this early work we've now developed a comprehensive China insights implementation plan. Our goal is to make insights accessible and actionable. Summarized here are some of our key initiatives which include firstly developing an innovative scorecard approach to help industry identify the most attractive areas for future growth. We're looking to find the sweet spot between opportunity or the size of the prize balanced against the best fit with our capability and supply constraints. We want to understand the ease of doing business and the impact that high levels of competitor activity could have on our future success in particular cities or geographic locations. Similarly we want to map the value chain options and identify top customers that industry partners should be seeking out based on more sophisticated customer segmentation approaches that lead to greater alignment. And we've also initiated a number of activities to ensure industry partners are engaged. Our value chain flagship demonstration projects will look to identify those value chains that want to work with us and to adopt some of these insights. We've just launched and you can find on our website a young food innovators traineeship program which will seek to attract bright young professionals into our industry that can bring fresh new ideas. We've already started our in-market immersion program for producers. We took a group of West Australian sheep producers and their value chain partners into the market last year and we're looking to share this knowledge both in online and face-to-face formats. You may have noticed on the previous slide that one of the key themes within this China innovation strategy is food without fear. This is a well-known but not necessarily well understood opportunity for Australian food in China. To achieve premiums in key Asian markets Australian food exports rely heavily on the promise of our world-class integrity systems and the delivery of food that is perceived as clean green and safe. In the red meat sector we have our true Aussie beef and lamb brand which is now globally recognised. But what is definitely starting to emerge is that this may not continue to be a value proposition that is uniquely ours. Many of our competitors are in fact already selling the same promise and if we're not vigilant and I would propose if we're not innovative we could very easily lose this position of competitive advantage. When I was on that supply chain tour in China last year I spoke to our major customer a company called Grand Farms and he was telling me that he definitely sources products from those countries that he believes he can trust Australia, New Zealand, Uruguay, Canada and one other that I've just Ireland. And when I said to him would you be considering putting a true Aussie brand on the product he was very appreciative and very happy to do so. And then when I went through his production facility and saw that there was no way he could actually differentiate his raw materials from those various countries I asked him further you know was he going to put a true Aussie label on those products and he said yes. So when I asked him through the interpreter how he was going to achieve that kind of level of traceability he looked at me a bit quizzically and said well I'll process Australian meat on Monday and New Zealand meat on Tuesday and possibly Irish meat on Wednesday and I said as I turned away don't give him any true Aussie stickers because obviously he doesn't differentiate the country of origin. For him each one of those countries can provide the promise that he's looking for and he he now believes that we need to compete only on price. I found that very distressing. So what is our innovation response to this? We believe that true insights into what constitutes a genuine opportunity for maintaining premiums for Australian food requires a much more sophisticated approach. Our innovation responses must be much more than simply strapping on the latest anti-fraud or anti-tamper device that has hit the market and many of them are. We cannot and we should not make assumptions about what consumers and customers mean when they say they want safe food. We must understand what they're willing to pay for before we jump into investing in complex and costly technologies and we must be clear about what the core problems we are trying to solve. It may be that a smart new value chain design is where the best solution lies and we heard more about that this morning. So as I indicated we're now extending this broad approach that we've been using for our deep dive insights into China to look at opportunities in other key markets and market segments and we're hopeful that the leveraging and synergies that are rising from the cross-sectoral collaboration will help us to get there faster and more efficiently. Before concluding I'd like to suggest that for investments in innovation in the agri-food sector to provide a comprehensive approach to dealing with uncertainty they should clearly encompass a balanced portfolio between productivity and value creation on the demand side. Many of you may already be aware of some of the exciting new developments in automation that we've been able to deliver for the red meat industry which has been supported by co-investment from commercial industry and technology partners. Technology has been automating processes for over 40 years now. We've taken that substantial history and commenced automating meat processing systems and in partnership with JBS and Meat and Life Stock Australia we've developed the world's first lamb x-ray primal and middle system. What we've seen so in the interests of time I'll just show you a little snippet of that one. These technologies are world leading and we'll go a long way towards improving off-farm productivity in our sector and ensuring the long-term economic sustainability of the industry overall. In addition to the transformational impact of the automation itself we are now also able to leverage sensing and measurement technologies that will further disrupt and define our industry. Those of you who are just in the digital agriculture sector would have heard Alex Ball speak more on this. Investment in innovations that underpin and enhance big data analytics and digital information systems cannot be seen as an optional extra. Whilst complex this is not an area of uncertainty for the future it is clearly where we need to head. So my concluding message is that despite uncertainty investment in innovation is critical to the future success of Australia's agri-food industries but I guess you already knew that. What I hope I've been able to share is how our approach to seeking deeper insights will help to declutter, demystify and de-risk the decisions about where to invest in innovation. Ultimately we want to help our industry become better connected. Connected to customers and consumers so that products and services absolutely hit the mark and are not hit and miss. Connected to best in class researchers and new knowledge and technologies wherever they are. Connected with passionate young professionals who will lead our industry into the future. Connected and investment ready to attract new sources of capital and better connected with each other as empowered participants in smart value chains that deliver high value products that attract premiums. This is what I believe will set our industries apart. Thank you.