Here's a further update on how COVID-19 is impacting the processing of livestock, the continuing extreme dry conditions in Southland and the ongoing disruption to the supply chain. The situation is also exacerbated by processing labour shortages due to immigration restrictions.
Joint update from Beef + Lamb New Zealand, the Meat Industry Association, DairyNZ and Federated Farmers
New Zealand’s red meat processing plants, particularly in the South Island, continue to be significantly impacted as a result of the community spread of COVID-19.
A number of people are being required to isolate or stay at home to look after family members. This is impacting processing capacity and resulting in unavoidable processing delays for farmers.
Year-on-year processing is well behind last season across all stock types and last season was a slower year than usual due to labour shortages.
Capacity will vary from plant to plant but it is ranging between 50–85 percent across the country.
The length of the processing delays will depend on how far each region is through the processing season and every processor and plant will have different run modes for ovine and bovine.
Farmers are encouraged to talk to their individual processors to understand how the delays will affect them.
Across the country, lamb processing is about three to four weeks behind last year, or 1.6 million lambs.
Cattle processing is about three weeks behind last season, which is about 120,000 animals.
Processing capacity in the North Island has started to improve considerably as COVID-19 cases have peaked.
The number of COVID-19 cases in the South Island is still to peak. While there has been improvement in capacity in the last week, the situation remains fluid. Processing capacity is unlikely to improve significantly in the South Island until mid-April onwards, and it will take a few months to get through the backlog that has built up.
Southland is the region we are keeping a close eye on, though parts of the West Coast and Otago are also feeling the feed pinch too. Some rain has fallen in the south but significantly more is needed in the coming weeks.
There is feed in other parts of the South Island and the livestock market is quite strong and this provides a good option for farmers that need to get their stock away quickly.
We are monitoring the cattle situation in Southland, particularly heading into winter. It is hoped the backlog could be cleared by September, but this is uncertain.
What the sector is doing to support farmers
Processors are working hard to manage the situation. They are continuing to move livestock to other plants to process farmers’ animals as quickly as possible and manage animal welfare risks.
They are also working overtime where they can, extending their processing seasons and increasing their minimum hourly rates to attract new employees and ease the labour shortage.
Beef + Lamb New Zealand and the Meat Industry Association are keeping a close watch on processing data and sharing that with DairyNZ and Federated Farmers. B+LNZ and DairyNZ’s extension teams are also on the ground supporting farmers and providing technical information so farmers can make informed decisions around feed planning and animal management.
Global supply chain
The global supply chain continues to be impacted by the pandemic, in particular Shanghai port in China. Port congestion, vessel schedule changes and a shortage of containers are causing bottlenecks and increased costs across the supply chain.
Advice for farmers
Talk to your key advisors, neighbours and friends.
Although there is currently not a pressing feed situation in most parts of the country, consider putting a feed budget in place and ensuring you have feed reserves in the event you need to hold onto livestock for longer.
Call 0800 BEEFLAMB (0800 233 352), 0800 4 DairyNZ (0800 4 324 7969) or 0800 327 646 (0800 FARMING) for one-on-one advice.