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The impact of the impending Mycoplasma bovis cattle cull on milk and beef supply nationally will be much smaller than the "devastating" impact on affected farmers, Westpac senior economist Anne Boniface says.
In the bank’s latest Agri Update, Ms Boniface said New Zealand’s dairy herd was about 4.8 million, so the population to be culled accounted for about 0.5%, well within usual seasonal variation in the dairy herd.
While processing capacity might be stretched temporarily at a regional level, there should be ample capacity nationwide to process the additional cow cull.
But on farms where the disease had been confirmed, the impact had clearly been "devastating" for individual farmers, businesses and the wider community.
There were already complaints about how long the compensation process was taking, as well as uncertainty about what compensation farmers would be eligible for, she said.
In addition to that, the loss of many years’ worth of improvements in breeding stock and the stress of sourcing new cattle and effectively rebuilding the business from scratch would have a massive impact on affected farmers.
"Add to this the lingering cloud of uncertainty over the future of cattle on farms currently under restricted places notice, and sentiment in the affected regions is set to remain downcast for some time yet," she said.
The response highlighted the importance of biosecurity to the New Zealand agriculture sector and the broader economy.