China's second-largest meat processor Kerchin Cattle has signed a multi-million dollar deal with two New Zealand companies.
The deal is the first agricultural contract to emerge from the free trade agreement with China and was confirmed during last month's Chinese delegation to New Zealand.
New Zealand companies FoodCap and TeMania Livestock will sign a co-operation agreement with Kerchin today in Beijing. Prime Minister John Key and Chinese Premier Wen Jiabao are expected to attend.
FoodCap spokesman Alan Mayne said this was an important milestone for the New Zealand meat industry. He would not disclose how much the deal was worth, but said it was in the "millions".
"The deal is beyond the millions. We all know the size of China. The economic value [for New Zealand] is huge."
The deal will open the way for FoodCap to establish distribution plants in key parts of China and the collaboration with Te Mania Livestock could improve the beef breeding stock of Kerchin's herd in Inner Mongolia.
It will also open the door for New Zealand meat, such as lamb, venison and beef, to be exported to complement the Chinese meat industry.
FoodCap uses minimal amounts of packaging when packing meat and transporting it.
The company has a range of systems for fresh chilled food and other temperature-sensitive, short shelf-life products.
FoodCap claims its patented technology can offer benefits, including food safety and security, traceability, improved meat yields, reduced handling and packaging costs and improved environmental impacts.
FoodCap monitors the temperature of the products to ensure they remain fresh and to a standard of high food hygiene, Mayne said.
"Due to the [Chinese] baby food scare, there is an increased integrity about food safety in China. That has been Kerchin's vision," he said.
Just under 50 per cent of Te Mania is owned by directors Weiguo Hong, from China and Bee Tec Hoong and Chun Win Wong, from Singapore.
The company has been breeding Angus cattle for more than 80 years.
Mayne said since the company's first joint venture in China in 1996, Te Mania has been keen to take part in a fully integrated supply chain from conception to consumption.
