Shocking observations on meat industry

08-09-2010 | Not Specified

Every month I look forward to your magazine, especially the farmer updates in the first few pages.

In last month's publication your farmer correspondent John Horrocks gave us his take on the sheepmeat industry. The heading was: No just cause for despondency.

I would hope a lot of sheep farmers reading this article would be as shocked as I was about most of Mr Horrocks' observations. Here are some that need countering.

"Why hasn't media concentrated on companies that are performing and recording profits?"

Co-ops' and company directors' prime directive is to maximise their balance sheets, therefore meat co-ops will not harvest their balance sheets to ensure farmer or supplier profitability.

"A drop in lamb numbers is great news for sheep farmers."

No. Medium and long-term this is bad news. Buying New Zealand lamb has to become a shopping habit. Erratic supply does not equal consistent demand.

"I am glad we can't supply certain markets because they didn't pay us enough."

It is our fault we have not been paid enough for our lamb in Europe. Giant retailers have structured their businesses in such a way to strengthen their purchasing power. We, on the other hand, still have multiple companies all competing for sales, which makes us weak at the selling desk.

"There is enough demand to curtail underselling."

Underselling will continue because of our fragmented industry. If we consolidate we will gain strength and respect and then have the ability to curb the giant retailers' mark-ups to a more acceptable level.

Lastly, I had a quick figure out and in my district, Dipton, 45,000 breeding ewes have gone in the past eight years. This would be the case, too, for many communities throughout Southland and further north.

I am sorry - this doesn't get me all "pleasantly euphoric for the foreseeable future".

Peter McDonald

Dipton

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