The research by SG Heilbron Economic and Policy Consulting shows the meat processing and exporting sector and sheep and beef farmers collectively generate $12bn in income per year for the country and accounts for more than 92,000 jobs, almost 5% of New Zealand’s full-time workforce.
Red meat sector
The sector is also responsible for $4.6bn in household income (on average $3,300 for every household in New Zealand) and represents approximately a fifth of New Zealand’s productive sector.
The research coincides with B+LNZ and the MIA launching a joint manifesto ahead of the general election which outlines the importance of political parties working with the red meat sector to re-build the New Zealand economy.
The policy blueprint also identifies the challenges and opportunities in environmental issues, trade and market access, animal welfare, food safety, biosecurity, innovation, employment relations, immigration and health and safety.
“As New Zealand’s largest manufacturing industry and the second largest goods exporter, the sector is critical to the prosperity and wealth of the country’s economy. The industry is also a significant employer, mainly in regional New Zealand, supporting the livelihoods of families and rural communities,” said Sirma Karapeeva, CEO, MIA.
“Despite the supply chain disruption caused by COVID-19, our industry has displayed real agility and resilience and continued to export lamb, beef and co-products to our 120 markets across the globe. With New Zealand experiencing significant economic headwinds, it’s critical we have a sustainable and thriving red meat sector to help the country weather the storm.
“The Government has a huge once-in-a-generation task ahead of it. The priority post-COVID-19 must be ensuring we have our long-term policy settings and infrastructure right. Open and predictable market access is vital for the ongoing success of our export-focused sector as it creates a stable and level international playing field in which our exporters can prosper and thrive.
“Our industry is one of the biggest trainers in New Zealand. The training system for meat processors is extremely effective at putting new workers onto career pathways and training them. We must have the right skills development and training framework in place to support the industry, our people and the country.”
Sam McIvorm CEO, B+LNZ, added, COVID-19 had caused extraordinary damage to people’s lives, livelihoods and economies across the globe and it will take some time for the world to recover from the impact.
“In this period of adversity, the primary sector has shone. Despite significant drought, feed shortages across the country and the Mycoplasma bovis outbreak, our industry has continued to perform strongly and deliver for New Zealand,” he said.
“It’s important that when making any decision about the recovery and the future, the country must ask itself - what is good for exports, employment, productivity and the environment.
“The Government must support practical on-the-ground initiatives by farmers to improve the environment, while ensuring that the environmental policy settings are right.
“A key concern for the sector is the impact of various government policies that incentivise the conversion of sheep and beef farms into forestry, due to the negative impacts on rural communities. The sector wants limits on the ability of fossil fuel polluters to offset their emissions by planting exotic trees on farms.
“We need to better understand and utilise our water resources. This includes water capture, storage and distribution to meet both productive and urban needs. We do not lack water in New Zealand - we lack the understanding and infrastructure to use it in a way that meets our economic, social, cultural and environmental requirements. It can be done.
“Improved rural connectivity and continued co-investment in initiatives and research aimed at value adding and lifting the productivity and profitability of the sector is also crucial.
“Despite the current uncertainties created by COVID-19, it is an exciting time for the red meat sector with the global population expecting to grow by two billion by 2050 and protein demand forecast to double by 2050.
“Globally, consumers seek out our products, thanks to the work famers have done to establish free range, grass-fed, natural farming systems – and it is our time to lead New Zealand’s economic recovery.”
The SG Heilbron study found the red meat sector is responsible for almost 5% of New Zealand’s full-time workforce with approximately 35,700 people employed directly and more than 56,700 full-time jobs underpinned by the sector as the result of flow-on impacts.
The magnitude of the red meat sector’s contribution is even more pronounced at a regional level with its impact reaching almost 12% of value-added, and in some cases, such as in Otago/ Southland, over 12% of full-time employment.
In the Otago/Southland region, the sector employs 7,700 full-time people with more than 10,000 full-time jobs underpinned by the industry. It also contributes 11.5% of household income in the region.
In Taranaki/Manawatu and Whanganui, the sector supports almost 10% of full-time employment in the region with 5,200 directly and underpinning more than 8,300 full-time equivalent jobs. It also contributes almost 9% of household income in the region ($650m or $4,770 per household). Almost two thirds of household income impacts in the region is derived from the flow-on effects.
Meanwhile, the production of livestock contributes 2.2% of full-time equivalent employment in New Zealand. The meat processing and exporting sector contributes approximately 4.4% of full-time equivalent employment and 3.9 percent of value-added when flow on effects are taken into account.
The research by SG Heilbron Economic and Policy Consulting examined the economic and social impact of beef and sheepmeat production, processing and exporting in terms of employment, value-add and household income, looking at both sides of the farm-gate. It also identified the impacts from a national and regional perspective.