Meat companies do “a pretty good job” marketing their product in Europe but are often unfairly criticised for their efforts in what is an extremely sophisticated market, an agriculture academic believes. Lincoln University Professor of Farm Management and Agribusiness Keith Woodford said the EU – including the United Kingdom – took 65 per cent of New Zealand’s lamb by value, paying the best global prices reports The Southland Times.

Companies were getting better returns than for beef, so for lamb to be so well placed in price suggested someone had done something right, Dr Woodford said. “I think they’ve got Europe pretty well sussed but always, of course, they could do a little better.” He told attendees at Meat & Wool NZ’s new Meat the Future field day last week that he expected New Zealand’s meat industry would need restructuring to survive, but did not believe that would lead to a Fonterra-like mega-company. It would probably lead to two large companies – one a co-operative, the other an investor-owner – and maybe some other smaller niche businesses, he said.

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Chief Executive, Dr Scott Champion, says the Strategic Plan defines the way in which M&WNZ will do business through to 2014 ¨To see whats new, what has been retained and where the organisation is putting more or less emphasis over time. We started by looking at the issues facing the industry, considering how the industry needs to respond, and then looking at what role we can play in that response.

Farmers wanted better communication about the tools and practices that will help them be profitable on a sustainable basis. We’ve implemented organisational changes which have seen a shift of staff from Wellington to the regions and there will be an increased focus on extension work, with a dedicated extension team now operating in the regions.

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Two women directors have been elected to the Meat and Wool New Zealand board, displacing men already involved in the industry’s power structures reports Business Day. Kirsten Bryant, of Fordell, has been elected to represent the Western North Island ward and Anne Munro of Fairlie, to represent the Central South Island.

Mrs Bryant was elected with 9620 votes, beating Manawatu farmer Tony Gray (5879) for a seat in which Ron Frew did not seek re-election. The voting return percentage was only 25.25 percent, even though Mr Gray is Federated Farmers’ Manawatu/Rangitikei meat and fibre chairman. During campaigning Mrs Bryant said she was motivated to stand when farmers in her area told Agriculture Minister David Carter that hill country farming was on its last legs.

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M&WNZ and Federated Farmers are joining forces to support wool industry rescue efforts. The two organisations will work together to advocate for farmer interests to improve the fortunes of the strong wool industry, Federated Farmers Meat & Fibre Chairman, Bruce Wills, and M&WNZ Chairman, Mike Petersen, have said.

The collaboration comes as the loss of the wool levy is about to take effect (April 2010) and follows the recommendations of the Wool Industry Taskforce. “Both our organisations are supportive of the taskforce process and its recommendations and we are pleased to see support for our long-held views on the need for targeted marketing and promotion of wool and woollen products,” said Mike Petersen.

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The Chairmen and CEOs of farmer organisations from five of the world’s major beef exporting nations, making up the Five Nations Beef Alliance, are meeting in Northland this week to consider how to make beef production more profitable.

M&WNZ Chair, Mike Petersen said NZ was hosting beef producers from Canada, the US, Mexico, Australia and NZ in the forum set up to progress trade policy and technical issues. “This is an opportunity M&WNZ takes every 18 months or so to deepen our relationships at the highest level with other beef producing nations. These relationships are very important in ensuring that we are able to work together on common issues as they arise in key markets.

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Lamb prices are continuing their high levels in overseas markets. So is the NZ dollar. Result – low lamb prices for the NZ farmer this year. All the effort that has gone into marketing lamb, meat company efficiencies, ram breeding and pasture improvements – all wasted because of a high NZ dollar. Yet it doesn’t have to be this way.

I supply Blue Sky Meats and have contracted 20% of my lambs at $5.30/kg reports Country-wide. Compare that to what the industry is telling us for the season – $4/kg if we are lucky. Blue Sky Meats is able to pay $5.30/kg because presumably earlier in the season it fixed its currency for this contract and sold forward (good luck to them – I bet some other meat company will try to undersell them).

The meat industry (through the meat companies) has a turnover of about $5 billion a year. That is huge. It is efficient in its cost structure. Many of the companies are now spending on marketing lamb overseas. But why bother investing money on increasing the value of the product overseas if the end result is less money in the hands of sheep farmers? One whole side of the equation, currency management, has been booted downstairs and put into the “too-hard” basket.

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The number of lambs tailed in the spring of 2009 was up 6.2% on the previous spring to 28.95million head reports M&WNZ. This is from less ewes, down 3.6% to 22.65million, which is at its lowest level for 50 years. Lower stocking rates and good pasture cover resulted in good ewe condition at tupping. This resulted in a  lambing percentage of 123.6% nationally. Lambs from hogget lambing increased dramatically by 41.4% to 970000 lambs but bad lambing weather did hinder hogget lamb  totals.

Based on this increased forecast, it is estimated that export lamb slaughter is estimated to be 23.5 million head. This extra million lambs at current estimates should inject about $70 million  into the rural economy but will not make up for lower per head return expected from the currency induced price drop.

M&WNZ has a new organisational structure ‘to ensure a greater connection with sheep and beef farmers’. Chairman Mike Petersen says the restructure of the organisation resulted in the disestablishment of 23 roles and the creation of seven new positions reports Rural News. The restructuring, required because of the failed wool levy vote in the recent referendum, has forced the organisation to look closely across all activities and decide what was going to provide the best return for farmers.

 ‘The reality of the loss of $6.4 million in wool levies has forced us to think carefully about what we do and how we deliver to farmers and it has catalysed some significant change for the organisation. We have approached this from the basis of needing to reduce costs, but also from making effectiveness changes to improve the impact of the business. This is so we can deliver on the mandate farmers have given us in respect to the sheepmeat and beef levies. Inevitably, that means staff redundancies of 23 roles and the creation of seven new positions.

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Marlborough’s Monitor Farm programme will not be shorn, at least in the short term, but some North Island programmes may fall by the wayside after M&WNZ’s wool levies were lost last month. At last week’s monitor farm day, held at Mt Adde, M&W SI manager Gary Walton said both the Marlborough and Nelson monitor farms would receive the same funding for the next year. However, there were two monitor farm programmes on hold in the North Island reports The Marlborough Express.

The fixed annual running cost of the Marlborough monitor farm programme was about $26,500. About 15% of that was funded by the wool levy. Other programmes run by Meat & Wool would be cut to accommodate the monitor farm programme, he said. The monitor farm programme has run since 1991 and focuses on an individual farm in a region where the agribusiness community helps it come up with a three-year business plan, and regular field trips are held at the property for other farmers to contribute and learn. There are 24 programmes in New Zealand.

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Meat & Wool New Zealand has notified new levy rates for the next year which are effective from 1 October 2009. They will be $0.45 cents per head of sheep slaughtered and $3.80 per head of cattle slaughtered. Both the goatmeat and wool levies were lost on a one-farmer-one vote basis in the recent referendum.
Meat & Wool New Zealand Chairman, Mike Petersen said the goat levy stopped on 30 September 2009, however a wool levy of $0.03 cents per kilogram would continue to apply until 18 April 2010 when the existing levy order runs out. “While we have stopped the wool-related activity that could be ceased immediately, in other cases there are contracts to manage and an orderly exist of these is being negotiated. Collecting a wool levy through to 18 April 2010 will be required to meet these costs.”  Mr Petersen said no levy would be collected on dags from 1 October 2009.