August 18, 2010

New scheme to boost New Zealand's red meat sector

A consumer-focused meat industry initiative will boost New Zealand's annual exports by NZ$2.3 billion by 2025, say its backers.

The programme plans to turn a production-led approach into one that was market-led and focused on responding to consumer needs.

Silver Fern Farms, PGG Wrightson, Landcorp Farming and the Government, through the Primary Growth Partnership, will fund the NZ$151 million seven-year programme.

This year saw declining stock numbers, industry overcapacity, livestock value more influenced by currency than market, dysfunctional supply chain relationships, lack of farmer commitment and a procurement tension that distorted market signals, Garden said.

Meanwhile, he said research would be undertaken into what overseas consumers wanted in meat, including preferences for taste, colour and texture.

State-owned Landcorp's operations included 61 sheep and beef farms and production in 2008-09 of 10,130 tonnes and 11,162 tonnes of sheep meat and beef respectively.

It was anticipated that by year seven about a third of sheep, beef and deer would be under the programme.

New Zealand Institute of Economic Research chief executive Jean-Pierre de Raad said models showed the programme would provide a NZ$521 million net economic benefit over seven years.

By 2025, the plate-to-pasture model is projected to increase red meat industry export revenue from NZ$4 billion to NZ$6.3 billion a year.

Silver Fern Farms chief executive Keith Cooper said the market component of the project was heavily weighted towards investing in what consumers wanted. Information would go into a database, including consumer preferences, genetics and yield, and be fed back to farmers in real-time, he said.

The market value of products was expected to account for 31% of benefits, with 13% coming from gains at processing plants and 56% from productivity gains on farms-a large part of which would come from animal genetics.