News and Media

NZ's Nui Markets takes on an American old boys' network

Published on 14 June 2021

  • News and Media
  • NZ's Nui Markets takes on an American old boys' network

A New Zealand software company is helping to disrupt the multi-billion US markets for primary products.

North American giants like Tyson Foods have been using phone calls, fax machines and spreadsheets to move everything from pigs' ears and chicken parts from farms to vendors.

"There are several layers of middlemen and fees. It's an archaic industry that relies on an old-boy network, a bit like foreign exchange in the 1980s. We are trying to cut the fat out. Our technology ultimately streamlines this process and reduces costs and gets the best price."

Ashley Honey, Nui Markets VP

Auckland-based Nui part of a wave of startups dragging the process into the 21st century with automated, online trading platforms - and recently scored a profile in the Wall Street Journal for its efforts.

"Companies like Nui, populated with former traders, are seeking to build streaming platforms that centralise supply and give access to smaller players at better prices," the WSJ noted.

Honey tells the Herald he is indeed a former Wall Street screen jockey. He moved from Auckland to New York in 2007 to trade foreign exchange and commodities.

In 2019, he joined Nui, cofounded by its chief executive Kevin O'Sullivan - also a former for-ex trader in 2012 (when it was initially known as Full Cream).

Nui had already enjoyed considerable under-the-radar success, creating what has become the largest online dairy trading platform in Europe, which launched three years ago and is now used by Scandinavian agri-food giants Danish Crown, Arla Foods and Valio Group Ireland's Glanbia.

Nui launched its first US trading platform

O'Sullivan says Nui has just launched its first US trading platform, for Hilmar Cheese - a giant cheese, whey protein and lactose manufacturer that's primarily aimed at the business-to-business and food service markets (it sells cheese in 20kg or 300kg blocks). Its cheese is used by various US national, regional and private label brands. Forbes says it's one of the largest cheese manufacturers in the US, and puts its annual revenue at US$2.7b.

O'Sullivan says Nui should have two or three more US deals to announce shortly. He won't reveal details, but he's become well versed in the US$70b market for chicken parts, and American's fixation with white over brown chicken meat, in contexts (fast food, packaged supermarket poultry). It's huge, but with low-tech trading - so ripe for Nui.

Honey says that, in a way, the pandemic has helped Nui to breakthrough in the US. "It was initially difficult to sign new clients. Everyone was just fighting fires during the first nine months [of the outbreak]," he says.

"But I think since the start of 2021 the move to digital in not just agri but all B2B [business-to-business] has accelerated. Large organisations are more receptive and understand the need to move digital."

He adds: "Usually the question I ask - as we do face a lot of resistance - is: 'How do you think tomatoes/poultry etc will be transacted in five years' time?'"

Why has there been such hostility to change over the past two decades, in so many primary commodity sectors?

Pale, stale, male

O'Sullivan blames a "pale, stale, male" hierarchy (notwithstanding he meets two of those criteria himself).
And while Nui has landed deals via Zoom, the best way to prod along a culture change is face-to-face, he says.

Is that ironic for a company pushing a digital, self-service way of doing business?
"We're not selling technology, we're selling change," the Nui CEO says.

That's why, pre-Covid, O'Sullivan spent 150 days a year travelling.
When the Herald speaks to him, he's about to jump on a plane to the US for trip that will take in multiple cities.

We're little known at home

O'Sullivan and Nui co-founder Dr Bruce Maunder still own a majority of Nui, which has been able to expand under its own power - though O'Sullivan says there might be a "small" raise later this year.

Nui now has eight live platforms across three different sectors: dairy, meat and produce, collectively supporting 400 companies in 55 countries, with 1000 individual users.

"We're little known at home," O'Sullivan says.

But his firm now wants to help NZ companies transform how they buy and sell commodities. A key focus for Nui this year is bringing Kiwi companies onto the platform.

Back to News and Media

In other news

  • The importance of the global dairy markets
    Published on 16 November 2022

    President of New Zealand-based Nui Markets North America, Ron O'Brien, spoke with Lee Mielke about Global Dairy Trading Struggling in the Nov. 14 Dairy Radio Now broadcast. Read more

  • Going paperless
    Published on 15 November 2022

    In September this year, we saw the best of British ceremony, pomp and tradition as the country mourned for Queen Elizabeth’s passing with a timeless display of historical theatre. Read more

  • What tools are you using to negotiate your trades
    Published on 02 November 2022

    This Bloomberg article should be a wake-up call if you’re still using Private Messaging to negotiate your trades. Read more

  • Winner of Best Emerging Business Award
    Published on 28 October 2022

    Whilst it’s true that winning in the marketplace is the most important recognition that any company seeks, for an emerging business, early in its growth trajectory, the confidence and self-affirmation that comes with winning industry awards also matters. Read more

  • DAO customer event at Madurodam
    Published on 18 October 2022

    Six months on from the acquisition of DAO, Nui Markets hosted its first customer event in several years. Read more