The plan, conceived by Beef + Lamb New Zealand (B+LNZ) in 2013, had been for a marketing scheme focusing on country-of-origin promotion. The proposal was for the NZ$8m cost to be split 50/50 between B+LNZ, which represents farmers, and meat processors.
But B+LNZ chairman James Parsons said meat processors had now decided not to go ahead. "We’ve had a lot of dialogue and constructive discussions with processors, considering how market development could be funded and delivered in the future. Naturally, after all the hard work, it’s disappointing that we weren’t able to get agreement."
Parsons said that by choosing not to be involved in joint market promotion with B+LNZ, processors would now have to take responsibility for red meat promotion, and additional investment would be needed by them.
Bill Falconer, chairman of the Meat Industry Association (MIA), which represents processors and exporters, said that processors already invest more than NZ$8m in their own brand promotions and this will increase as new markets are developed. "Considerable time was spent usefully exploring the possible content and cost of a country-of-origin programme.
"However, a solution could not be identified justifying processors assuming 50% of the cost over and above the marketing investments they are committed to making and growing. Processors’ investment will continue to be directed to the product and consumer branded activities they develop with their distributors and retailer partners in existing and developing markets."
He added that B+LNZ had traditionally undertaken the generic marketing of beef and lamb and the proposal to split costs was a new idea simply to reduce the funding burden on farmers, which they had decided to not accept for "commercial considerations".
Parsons said the B+LNZ board would now be "taking a deep breath and considering the next steps before we shape up our final proposition to put to farmers for the 2016-2022 commodity levy cycle. We are a grassroots farmer organisation governed by farmers, so our fundamental rule of thumb when directing farmers’ investment is that it must deliver value back behind the farm gate."