“Demand is, by and large, managing to offset the 15% tariff ... American consumers eat three burgers a week per person. They need to get their beef from countries like ours, with a very lean product, and it blends with their feedlot beef,” says Guy.
“We are a very important component in terms of US consumer demand. It’s proving to be our number one market.”
The worst US drought in seven decades had sharpened the US appetite for New Zealand beef, with the US herd severely curtailed in size.
China is still a very important market, underpinned by the New Zealand-China free trade agreement, says Guy. Some Chinese importers have been slower to rebound post-pandemic than predicted but, importantly, China buys a lot of meat cuts that there isn’t demand for elsewhere.
“With Europe and the UK, we have two very successful free trade agreements and they’re proving quite lucrative right now for exporters. And we shouldn’t forget Southeast Asia on our doorstep.
“There’s a real focus for New Zealand companies to add more value with things like organs, glands, hides and pelts. There’s quite a bit of work going on in the industry to continue to add more products, so we add more value to what used to go into a waste stream.”
Trade prospects had got a further boost with last month’s launch of the New Zealand-United Arab Emirates Comprehensive Economic Partnership Agreement offering access to a high-value market and wealthy customers. Further boosts were in the pipeline from trade deals with Saudi Arabia, the Gulf States and, hopefully, India.
“We’re very fortunate to have amazing access and kudos to the New Zealand Government there.”
Challenges ahead include geopolitical fallout, says Guy.
“We’ve got more protectionism at play in some markets, particularly on the back of Covid.”
Non-tariff barriers were costing the red meat sector $1.5b a year in lost opportunity.
Geopolitical challenges have always existed but are more highlighted today with conflicts around the world, he says.
“Along with US tariffs and shipping logistics’ higher costs, we’ve got increased costs like most businesses are facing with energy, rates, insurance, and wages.
“So while it’s looking pretty rosy in terms of schedule prices for farmers and returns for processors, there are international factors at play and rising costs.”
The Ministry for Primary Industries expects meat and wool sector revenue in 2025-2026 to rise to $12.7 billion.
