Sheepmeat and beef levies to increase

Beef + Lamb New Zealand’s Board has decided to proceed with the proposed increase in the sheepmeat and beef levies following significant support from farmers.

Sheepmeat and beef levies to increase from 1 October 2018

From 1 October 2018 the levy for sheepmeat will increase 10 cents to 70 cents per head and the beef levy by 80 cents to $5.20 per head. This is 0.4 per cent of the average slaughter value for prime steer/heifer, 0.7 per cent cull dairy cow, 0.7 per cent of lamb, and 1.1 per cent of mutton over the last three years.

The additional levies will be invested in accelerating four key programmes: the international activation of the Taste Pure Nature origin brand and the Red Meat Story, helping the sector lift its environmental performance and reputation, telling the farmer story better, and strengthening B+LNZ’s capability to address biosecurity risks.

In our consultation process we asked farmers three questions:

  1. Do you support the proposed levy increase?
  2. Do you support how we propose to invest the additional levies?
  3. Do you have any other feedback on how B+LNZ is investing sheep and beef levies?

Andrew Morrison, Beef + Lamb New Zealand’s Chairman, says there was clear support for the levy proposal with almost 63 per cent of respondents backing an increase.
 
“We were pleased by the level of interest in the proposal and the amount of detail we received in the submission forms.
 
“Along with 63 per cent of respondents backing an increase overall, there were also similar levels of support across sheep, cattle, and dairy farmers. This is particularly pleasing as B+LNZ takes its responsibilities towards all levy payers extremely seriously.”

Almost two thirds of respondents (64 per cent) also indicated support for the strategic direction of B+LNZ, which is an encouraging message from our farmers.

Along with the indications of support for the levy proposal and the priority areas the additional investment would support, farmers also provided valuable feedback about B+LNZ more generally.

“Feedback from farmers showed widespread support for the Taste Pure Nature origin brand and the organisation’s new environment strategy,” says Mr Morrison.

“However, farmers also encouraged B+LNZ to work collaboratively across the sector to ensure there wasn’t a duplication of effort.”

While many farmers endorsed the additional investment proposed by B+LNZ, noting the small percentage of overall animal sale value, others indicated that they were concerned about potential cost pressures for the sector too.

“We’re aware that for some farmers their costs are increasing and that there is uncertainty around the impacts of Mycoplasma bovis and what their share of the phased eradication cost will be,” says Mr Morrison.

“In making this decision, we’ve considered farmer’s concerns carefully. Even though we had a clear mandate from the 2015 referendum to increase levies, we committed to coming back to farmers to ensure they backed the direction we were heading in. We’ve listened to the valuable feedback that farmers have given us and we’ll be working hard to ensure that the results of this additional investment will deliver benefits for our industry.”

To implement the levy increase, B+LNZ will be gazetting the change in September, informing meat processing companies of the rise, and advertising the change to farmers over the coming weeks. The levy increase will formally take effect from 1 October 2018.
 
1881 farmers lodged postal and online submissions during the consultation process, which ran from 5 June to 13 July 2018 and over 1000 farmers attended face-to-face discussions about the proposal.

Further information on how the results were calculated and the feedback received from farmers is available here:

Further information on the levy proposal that was consulted on can be found in these two documents:

WATCH: Chairman Andrew Morrison and CEO Sam McIvor explain the levy proposal

Other B+LNZ documents