O’Connor opts for a ban on exports of live beasts (rather than tighter regulations) to demonstrate our high animal-welfare standards

Commodities are leading the global economic recovery. International demand for grains, dairy and forestry products is extremely strong – driven primarily by increased demand from China, ANZ Bank  economists say in their latest NZ Agri Focus.

Dairy markets shot up in March, driven by strong buying from China, among challenging conditions to deliver product to market. Since then prices have stabilised near current levels, encouragingly, despite more product being added to the GlobalDairyTrade sales channel.

The recent strength in global markets, combined with a slight softening in the NZ dollar. has been supportive of farmgate milk prices.

“We are forecasting $7.70/kg MS for this season and $7.30/kg MS for next season,”  the  report  says.

If cumulatively it has been a remarkably good  season  for the  dairy  industry, results  have   been more  varied for  the processing companies and  for  individual  farmers.

Synlait and A2 Milk, for example, have not found the going easy,  given  the  impact  of  Covid-19  on the  daigou  trade  with  China.

But Fonterra – as the  principal  player – has  got  back its  mojo    as  industry  leader, with its  finances  in  much  better  shape  under  CEO Miles  Hurrell’s  leadership   than  under  the  previous  regime.

A strong  finish to  the season is looming, with recent strength in global dairy commodity prices  more than offseting the rise  in the NZD.  Immediate demand is being inflated by buyers making additional purchases to ensure they don’t run out of stock.

Stock levels were generally run down earlier in the pandemic as buying activity slowed a little due to uncertainty around the level of consumer demand.

The ANZ economists say consumers have continued to buy dairy products at similar rates to pre-pandemic levels. The economy of China – the world’s largest dairy importer – has recovered quickly from the pandemic which has helped boost dairy demand. Demand has also been supported by the rising consumer perception that dairy is a healthy food choice as many people have become more health-conscious as a result of the pandemic.

Given this background, morale has been recovering in the industry. It had been under constant attack from (mainly) urban critics with accusations of “dirty dairying”, even though a high proportion of NZ farmers rate as world leaders in environmental  practice and in the  lowest  methane emissions.

So with the prospect of sustained high prices, the industry   would  have  been  working  towards  higher production  next  season.

But then along comes the government to say it  intends to ban shipments of  live  animals.

“A kick  in the  guts”  the  ACT party  says.

Federated  Farmers  throws  up its  hands in  “surprise”.

Poor  old   Damien  O’Connor is left  in the  dogbox    (again),  offering excuses  as  the  bleeding   hearts  in   the  animal   welfare   groups celebrate.

It seems the Minister was rolled  by  the  dominant  “be kind”  philosophy  that prevails in the Ardern Cabinet,  with  Finance Minister  Grant Robertson confirming   animal welfare  must be  placed  first.

The Agriculture Minister’s justification is  based, he  says,  on the  “risk”   to   NZ’s  reputation for  high  standards  of  animal  welfare.  He reckons concerns about this  “risk”  have been steadily increasing.

But not – apparently – in the  export markets to  which the  trade in  live  animals was  directed.

O’Connor says:

 “We must stay ahead of the curve in a world where animal welfare is under increasing scrutiny.”

So NZ has to sacrifice a trade worth $500m  a  year, according to some estimates.

Figures from Stats NZ show more than 100,000 breeding cattle were shipped to China last year, to the value of $255.89m.

O’Connor said the decision would affect some farmers, exporters, and importers and a transition period would enable the sector to adapt.

Officials had talked to key trading partners about the decision, he said, and recognised the importance of maintaining those trade relationships.

“We’re committed to working with them as we transition away from the shipment of livestock. NZ has an opportunity to boost trade through our cutting-edge scientific work into dairy cow genetics and germplasm use.”

O’Connor argues that once animals leave NZ by sea the government has very limited ability to ensure their wellbeing before they reach their destination. He describes this as an unacceptable risk to NZ’s reputation.

But has anyone noticed a risk to the reputations of other  nations engaged  in   the  trade?

And if there is an issue, surely the answer is  to  tighten the  regulations under  which  animals  are  shipped.

O’Connor contends the ban on live exports means the animals will stay in NZ.

But they won’t stay for long.  Because most of those due for export are usually surplus on  local farms, they will  now  head  to the  works.

So  will  the  new  ban  really  do  what  the  government says  it  will do  in  enhancing this country’s

“ … reputation as the most ethical producers of livestock protein in the world.

….”I think this will actually play positively into our international reputation.”

 Good luck with that, Damien.

Meanwhile the people who will lose income and perhaps their livelihoods  as  a result  of  the new  ban will   just  have to  suck it up.