Beef + Lamb NZ Ltd’s Economic Service figures show however, that the NZ producer’s share of the retail price of New Zealand Lamb sold in Britain has actually grown by eight percent over the last seven years (see above). In 2010-2011 it accounted for 57 percent, squeezing the processor portion, from farm-gate to the ship (FOB), to just nine percent and the ship to retail portion to 34 percent. It has rebounded since, to the New Zealand farm-gate price accounting for 44 percent of the total retail share, processor 10 percent and the NZ FOB to retail portion accounting for 46 percent in 2011-2012.
British figures suggest a 43 percent producer share of the retail price for UK producers. However, it’s not possible to directly compare the two, with EU producers having the advantage of subsidies (albeit reducing), a different marketing and sales set up and being so much physically closer to the market.
The EU (including the UK) is still an immensely important market for New Zealand sheepmeat, but it’s important not to focus on the returns from one market. China, for example, is growing rapidly as a major market for New Zealand meat – it became the number one volume market for sheepmeat in the year to end 2012 (though second in value terms to the UK).
Speaking in B+LNZ’s SceneHerd conference earlier this week, Beef + Lamb NZ Ltd chief executive Scott Champion noted that only 70 percent of last year’s EU quota was filled and that there is a lower proportion of New Zealand Lamb going to the UK as growth in markets like China climbs.
In addition, the Trans-Pacific Partnership agreement, that Japan has this week announced it is interested in joining, is expected to be negotiated by the end of next year, potentially opening those markets wider too for New Zealand meat exports.