European grain-fed beef deal, 'great for farmers'

Negotiations by the Hon Tim Groser, has delivered a great opportunity for the beef industry to export grain-fed beef into the European Union (EU). Not only that, it also creates added opportunities for New Zealand’s arable sector too.

“It’s an encouraging sign that despite the US debt crisis amidst the EU’s own sovereign debt issues, that the logic and opportunity for free trade is still there,” says Jeannette Maxwell, Federated Farmers Meat & Fibre chairperson and a Canterbury sheep and beef farmer.

“Currently, the EU takes around 11,000 tonnes or just three percent of our total beef exports. The opportunity before our processor-exporters doubles to 20,000 tonnes then quadruples to 45,000 tonnes next year. All of it tariff free.

“Currently, feedlot beef is predominantly consigned to Japan, but that market specifies black beef cattle only. Opening up Europe to grain-fed beef helps to diversify our export markets and that reduces the risk on us as farmers.

“There’s also a struggle to secure enough black coloured animals for the feedlots. This EU deal widens out the beef species we can export, meaning much improved optimisation. Greater efficiencies in turn will yield better returns.

“It’s not just a beef opportunity, but becomes an arable one as well. All things being equal there should be market opportunities locally to supply grain to the feedlots.

“It helps to cement a cross sector farming relationship. With grain supplies increasingly tight, both farmers and the feedlots need to plan ahead and work with our arable sector to ensure the supply of high quality Kiwi grain.

“In recent years, there’s been a fundamental shift of beef back to traditional hill country areas. While the most recent statistics for 2010 saw the national beef herd fall 3.7 percent, key beef farming areas, especially in the North Island, saw herd numbers increase.

“Speaking personally, my farm in Canterbury is now 50:50 sheep and beef. As farmers we have to work with the processors to ensure the opportunity that the trade minister has delivered, becomes reality.

“We’re appreciative to have the tariff free quota access, so the challenge is to fill that quota. It means a joined up approach from the paddock to the consumer’s plate positioning New Zealand grain-fed beef as the European consumer’s preference,” Ms Maxwell concluded.