STIRRING UP CONFLICT WHERE NONE exists

I refer to your lead story in the 18 August issue - Three-way fight for lamb share. The tenor of the article does not reflect the market situation for lamb throughout Europe, in particular as it relates to New Zealand.

New Zealand has a tariff quota for sheepmeat imports into the European Union of 227,854t carcase weight equivalent. This quota has been utilised for many years, save the last two in which New Zealand exports to the EU were slightly down due to strong international markets and slightly lower production in New Zealand.

Growth in exports by volume to any one or more European markets therefore occurs within the total available quota, necessitating a reduction to other European markets. Product is exported in response to consumer demand, determining trends in volumes and mix of product marketed within the total EU market.

True, the market mix in France continues to move from frozen to chilled lamb cuts, but that is the pattern in all our major markets, driven by consumer demand.

New Zealand has focused on supplying a consistent, high quality product to European consumers. This has been supported by significant promotional investment, in the UK in particular, as well as many other European markets over many decades.

It is inaccurate to say there is 'an increasingly aggressive New Zealand marketing lobby'. Meat & Wool New Zealand, responsible for generic market promotion on behalf of New Zealand sheepmeat and beef farmers (but not involved in the commercial sale of product), continues to focus its promotional efforts on a few targeted markets and within the limits of available funds.

There can be no doubt that New Zealand farmers and exporters have a major interest in generating the best possible returns from the market. New Zealand is more reliant on export markets than any other lamb producing and exporting country with more than 90% of production exported per annum. There is no domestic support to farmers and they must absorb currency fluctuations that have such a significant impact on farm-gate returns irrespective of the overall strength of major export meat markets.

Reports therefore that imply that 'NZ moves were threatening to undermine the EU market' are not only wildly inaccurate, but seek to stir up conflict when none exists.

Total European sheepmeat production is expected to decrease some 2% in 2006, and this follows a small decrease in 2005. Total sheepmeat consumption in the EU is predicted to decline just under 1% in 2006. Maintaining sheepmeat consumption at a volume that retains sufficient market presence as well as maintains the premium positioning of this protein in competition with numerous meat alternatives should remain the major focus for domestic producers. Exports also play a significant role in achieving this.

As with New Zealand, export opportunities for British lamb will also rely on continuing to provide European customers with what they demand.

Concentrating on this core objective remains the cornerstone for our collective interests in ensuring that European consumers continue to consume lamb.

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