Beef exports to US run into quota wall

By LIAM DANN

New Zealand beef exporters will run out of US quota before the end of the year, forcing them to pay huge tariffs or divert meat to less lucrative markets in Asia.

Meat New Zealand figures show beef exporters have already filled 85 per cent of their US quota.

That is 10 per cent more than at the same time last year.

New Zealand beef production has risen by nearly 25 per cent in the past four years, making the US quota an increasing barrier to trade.

It was only in the past three years that New Zealand had started to fill all its US quota, said Meat New Zealand trade and technical policy manager Ben O'Brien.

New Zealand is allowed to export 213,000 tonnes of beef to the US.

A big increase in the nation's dairy herd was driving the growth in beef production, O'Brien said.

This season was affected by larger than usual kills in the first half of the year as drought forced stock culls.

Demand for New Zealand beef had increased in the US because of an export ban on Canadian beef caused by a case of mad cow disease.

Once quotas are reached all further sales face tariffs of 26 per cent.

Big exporters such as Richmond will reduce US sales and send more product into less lucrative Asian markets to avoid paying the tariffs.

Richmond's beef marketing manager David France said US markets generally paid the best price and were the only ones that would take certain cuts of manufacturing grade beef.