Closing FoodHQ sells tomorrow’s exports to balance today’s books

FoodHQ, the Palmerston North hub set up to turn New Zealand’s food science into commercial products, will close at the end of October after 13 years of operation. On its own balance sheet the decision looks tidy. Viewed against the country’s biggest export engine, it looks like a sector eating its seed corn.

A super campus that shrank to a handful

FoodHQ launched in 2013 as New Zealand’s ‘food super campus’, originally pitched as part of a $250 million, 20-year investment plan near Massey University. Its shareholders were Plant and Food Research (now part of the Bioeconomy Science Institute), Palmerston North City Council and Fonterra, with Massey and agribusiness trusts also contributing.

The ambition never matched the funding. By the end, FoodHQ was down to several scientists and no property assets, running on annual revenue of about $840,000. Even so, it punched into the areas that matter for the next decade of exports: hemp, fungi and seaweed proteins, foods for GLP-1 patients, dairy’s next opportunity and the future of aquaculture.

Chief executive Dr Victoria Hatton says these efforts are “always the first to be cut when budgets get cut, almost like it’s easy to just run a red pen through them”. She is right, and that is precisely why they should be protected. Science capability with no immediate return is the easiest line to delete and the hardest to rebuild.

The chairman says the work lives on

The counter-argument deserves a fair hearing. Chairman Mark Piper says the collaboration FoodHQ was created to foster is now happening better than it was in 2013, and the owners concluded the money was better spent inside their own organisations. The decision had, in his words, “unanimous support from the owners and funders”.

That is a reasonable governance call. Business owners should not fund intermediaries for sentiment’s sake. But Piper also offered a telling admission, that blue sky research is “harder to justify because it doesn’t have an immediate return on investment”. Every incumbent says that. It is exactly why someone independent needs to do it.

Record exports, shrinking pipeline

The numbers frame the risk. MPI forecast food and fibre exports would rise 6% to a record $64.3 billion in the year to June 2026. Yet government investment in primary industries and bioeconomy research is projected to fall to $194 million a year by 2029/30, a third below 2026/27 levels.

The private sector is not filling the gap. Stats NZ’s latest survey shows business R&D spending of $4.1 billion in 2025, up just 0.4%, with R&D staff down 5.1% and R&D as a share of GDP slipping from 0.98% to 0.95%. Food product manufacturing R&D reached $166 million in 2024, but the series is volatile; as Figure.NZ data published in 2025 showed, it sat as low as $74 million in 2018.

The wider science system has been shrinking too. The Bioeconomy Science Institute, which absorbed AgResearch, Plant & Food, Scion and Landcare Research, cut 134 roles in February. Save Science Coalition figures put total losses at around 700 publicly funded science roles since 2023, with only about a third of affected scientists finding new work locally. Then-Science Minister Penny Simmonds pointed to record total R&D spending and 2,400 net new science-sector roles between 2022 and 2024, mostly private. That is a fair rebuttal on headcount, but not on where the expertise sits.

In April 2026 the Association of Scientists warned the government’s prioritisation approach meant “very large cuts” for enduring strengths like agriculture and horticulture while chasing technologies New Zealand had mostly neglected. Sceptics of bureaucratic science spending should take that point seriously. Backing proven comparative advantage is the conservative bet, not the radical one.

Small firms lose their front door

Fonterra will keep researching. So will Massey and BSI. The real casualty is the small food company, the startup or the regional processor that cannot afford its own lab and does not know who to call inside a merged mega-institute. FoodHQ’s distinctive value was as a neutral intermediary giving those players access to R&D they could not organise alone. That is where new high-value products, and future exporters, come from.

What happens next

The test is simple. If BSI, Fonterra and Massey genuinely open their doors to small food businesses, Piper will be proved right and FoodHQ’s closure will be a sensible rationalisation. If they don’t, the sector will discover the cost in five or ten years, when the next-generation proteins and functional foods arrive branded by someone else. Food exporters should start asking BSI now who their contact is. If nobody can answer, that tells you what was really cut.

Sources

• The Post: Government-industry food innovation hub FoodHQ to close at end of October (2026-10-11)
• NZ Herald: Scientist blasts decision to close Palmerston North’s FoodHQ as ‘problematic’ in the long-term (2026-10-13)
• RNZ: Scientist blasts decision to close Palmerston North’s FoodHQ as ‘problematic’ in the long-term (2026-10-13)
• Farmers Weekly: End of an era as FoodHQ to close after 13 years (2026-10)
• MPI: Situation and Outlook for Primary Industries December 2025 (2025-12)
• Stats NZ: Research and development survey 2025 (2026-04-23)
• Figure.NZ: R&D expenditure by the food product manufacturing industry in New Zealand (2025-04-23)
• Newsroom: Build it, and they will come home (2026-06-12)
• 1News: Science job cuts spark ‘brain drain’ warning from researchers (2026-04-18)
• New Zealand Association of Scientists: ‘Prioritisation’ report could cost NZ dearly (2026-04-02)