Vote backs funding red-meat initiative

Sheep and beef farmers have given the seal of approval to co-fund the $65 million Collaboration for Sustainable Growth red-meat sector initiative, paving the way for the programme to proceed.

The resolution was passed with 77% support from 2746 participating votes, after a farmer vote held at Beef and Lamb New Zealand's annual meeting in Wanaka last week.

Up to $32.4 million from the Ministry for Primary Industries' Primary Growth Partnership Fund (PGP) had been approved for the programme, while Beef and Lamb had to gain farmer approval to invest up to $2.8 million a year over seven years.

At a New Zealand Meat Board meeting in Wellington this week, Beef and Lamb was given approval to commit existing reserve funds towards the programme.

Beef and Lamb chairman Mike Petersen described the outcome of the vote as a strong endorsement for the programme which had the ability ''to take the sheep and beef sector to the next level''.

''It's particularly pleasing that farmers have supported this unprecedented red meat sector collaboration with six meat companies, two banks and a professional services firm, with the potential to transform the sector,'' Mr Petersen said.

The next step was the development of the contract between the Crown and the partner group and it was hoped that the programme activities could be delivered in the second half of the year, he said. Federated Farmers meat and fibre chairwoman Jeanette Maxwell said the programme would provide a ''huge'' amount of investment in ways farmers could directly increase their productivity and returns through their own efforts.

While the red-meat sector was having a tough season with drought adding to the stress of lower prices, Mrs Maxwell was confident the programme could mean farmers did not face such dire seasons in future.

''This partnership will fund research into what improvements on and off farm can be made to directly increase farmers' productivity and lower our input costs. It will lead to better communication and collaboration between all parts of our industry, which will increase farm-gate returns,'' she said.

Rabobank's agribusiness monthly for February showed lamb prices remained under considerable pressure.

South Island lamb prices in the first week of March averaged $4.31/kg, 35c down on the corresponding week in February.

Total sheep meat exports surged during January, rising 37% year-on-year to 35,218 tonnes. Encouragingly, the rise was underpinned in most major markets, the report said.

Influencing the strong rise was a significant jump in slaughter, driven by dry conditions.

For the October to January period, total lamb slaughter was 19% higher year-on-year at 7.288 million head, while mutton slaughter had risen 31% over the same period, at 2.134 million head.