FTA breaks 50-year export drought

SIGNING OF A FREE TRADE AGREEMENT between New Zealand and the United Kingdom in March opened up a wealth of opportunities for this country’s beef industry, Beef + Lamb New Zealand says.

While the agreement has yet to be ratified by both parties, which will likely happen early next year, it signifies the end of more than 50 years of virtually no access for NZ’s beef products.

Frances Duignan, B+LNZ’s Senior Manager, International Trade, Policy and Advocacy, says this agreement gives exporters 12,000 tonnes of tariff-free exports from the outset. This increases every year for 15 years after which there are no quota limits or tariffs.

While the FTA includes any beef products, Duignan says given the nature of the UK market, it will likely be a market for high quality cuts, either fresh or chilled, rather than manufacturing beef.

While NZ beef will be competing with Australian, South American, Irish and Canadian beef in the UK, Duignan says NZ’s advantages sit with its high animal welfare standards, which aligns with those of the UK’s, food safety standards and sustainable farming practices.

Unlike other countries, NZ’s sheep and beef farming are typically intertwined, so processors and marketers will be able to leverage off NZ’s strong reputation for high quality sheep meat in the UK market. As NZ will be starting from a zero base, Frances says it will mean beef could be diverted from Asian and United States markets into the UK, but most importantly it allows beef to go to whoever is prepared to pay the best price.

“The more markets open up for us, the better able we are to get the most out of every animal. It’s a big win for us.”

Duignan acknowledges British and Irish farmers are not welcoming the UKNZFTA, just one of several FTAs the UK government is entering, but it is a time of significant change for British farmers with Brexit, subsidy reductions, and the fall-out from the Russian invasion of Ukraine.

This agreement will have its advantages for the UK, with opportunities to export products such as dairy products, whisky and gin tariff-free into this country.

It also opens the possibility of British beef producers working alongside NZ in the future to ensure continuity of supply into the Asia Pacific region under the Comprehensive and Progressive Agreement for Trans Pacific Partnership ( CPTPP), a free trade agreement involving NZ and 10 other countries in Asia Pacific region.

NZ already works closely with its competitors in the International Beef Alliance and the Global Roundtable for Sustainable Beef which works to ensure that global beef exports are delivered to NZ’s high standards and that the bar keeps lifting.

• Supplied by Beef + Lamb New Zealand.