Levy rise backed, more cash sought

NEW ZEALAND - Waikato beef farmers appear to be backing a planned increase in their industry-good levy, but a Meat and Wool NZ director says more money would still be needed to allow Kiwi beef to compete against its Aussie rivals.
calendar icon 17 July 2007
clock icon 2 minute read
Farmers met in Hamilton last week for the first of 12 Meat and Wool consultation meetings to discuss the organisation's proposed budget and levy for 2007-08.

Farmers currently pay $3.60 per animal slaughtered to Meat and Wool to fund research and promotional activities. A decline in the number of cattle expected to be slaughtered this year has prompted Meat and Wool to ask farmers for another 80 cents per animal to raise an expected $1.8 million to maintain current activity levels.

Northern North Island director Tom Mandeno said rising dairy prices were among the factors leading to fewer cattle being slaughtered as farmers held on to stock that would otherwise have been sent to the works.

"Farmers do not want to see that work curtailed, which unfortunately will be the result if the levy is not increased," Mr Mandeno said.

He said the levy equated to one third of a per cent of an animal's value.

Mr Mandeno said while not currently under consideration, the Australian levy model where $5.50 was collected at each transaction was an option that should not be ruled out in future.

With the average Australian beast changing hands 2 1/2 times in its lifetime this generated more than $13 per animal in industry good levies.

"It would be more difficult to make a system like that work in New Zealand but I think that's something that maybe what farmers will want to consider when the levy comes up for review again in 2009.

"That gives Australian beef producers considerably more resources to compete in areas like north Asia where we compete with them."

Waikato Federated Farmers meat and fibre chairman Andre de Haan said only two of the 23 farmers at the meeting voted against raising the levy increase.

"We have done a lot of research work and to pull the plug on that would be a waste," Mr de Haan said.

"We have learned a bitter lesson to pull the plug on promotion activities. Wool has never really recovered from a lack of promotion."

Mr de Haan said an 80 cent increase in the levy would mean about a $20 increase for most farmers.

"There's more to gain than lose with this."

Source: Waikato Times
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