Contestable $850,000 fund to encourage red meat sector

Photo / Nicola Topping

An $850,000 contestable fund has been established to drive further growth of the red meat industry - New Zealand's second-largest export earner.

The Red Meat Market Development Contestable Fund is a joint initiative between New Zealand Trade and Enterprise and Beef and Lamb, with funding allocated to successful applicants on a 50/50 basis.

Yesterday's announcement, by acting Economic Development Minister David Carter, comes less than a week before the launch of the red meat sector strategy report which is aimed at improving the viability of the sector.

Red meat generated around $5 billion in export revenue last year and the Government believed a more concerted approach by the industry could considerably lift that figure, Carter said.

The contestable fund aimed to encourage innovative industry-led projects that would lift the profitability, competitiveness and sustainable growth of the meat sector.

Applications for the fund, which will be administered by New Zealand Trade and Enterprise, close on May 20.

The success of the 2009 Aquaculture Market Development Contestable Fund, which had driven significant innovation and market development in that industry, demonstrated the potential scope for the red meat sector, Carter said.

It further enhanced the Government's Primary Growth Partnership which has so far pledged more than $60 million towards a joint $150 million red meat programme.

It also flagged the importance of the red meat sector strategy report which is due to be launched by Prime Minister John Key next week, he said.

An interim report released by Deloitte partner Alasdair MacLeod in January initially identified three areas needing to be addressed in the industry: livestock procurement, especially the role of stock agents and third parties; in-market behaviour of exporters; and variable farm performance.

Meat Industry Association chief executive Tim Ritchie said the establishment of the contestable fund was certainly positive and the good thing was it appeared to be market led.

While he had not yet seen all the details, he expected it would be something that processors and exporters would have a very good look at and think of the type of initiatives they might have that could fit in with it.

It was very timely, with the impending launch of the strategy report, and he imagined there would be some themes within that document that could well be applicable to it.

North Otago Federated Farmers president Ross Ewing, who farms at Kauru Hill, said any assistance was "in the right direction".

He did not believe there was a problem selling meat, rather he felt the problem was that there was a need to produce more, ensure costs did not get out of control and he was also concerned about biosecurity.

Ewing was interested to learn the findings of the strategy report.

"As an industry, we have to be [interested]," he said.

- OTAGO DAILY TIMES