Meat Bd changes lamb plan

Press, 26 August 1982, Page 1

Meat Bd changes lamb plan

Farm editor The Meat Board has substantially revised its proposals to regulate the export lamb market and yesterday gained the approval of meat exporters for the new plan.

The main elements of the proposal are strict controls on exporters working in the United Kingdom lamb market and the establishment of a Meat Industry Trading Organisation (M.1.T.0.) to function in single buyer and seller markets. Farmers will be able to sell export lambs on a weekly schedule, as at present. and into company pools. The proposal agreed to in talks between the board and exporters this week is a significant departure from the board's proposal discussed at 30 farmers' meetings throughout New Zealand in the last two weeks.

The new proposal arose from the Meat Exporters' Council and deletes all reference to national pools. The board’s chairman, Mr Adam Begg, said yesterday that the negotiations which had resulted in the new agreed scheme had been rushed, but that the board had taken notice of the views of farmers expressed at the recent meetings. , He said he had kept the Government informed of negotiations with the exporters and he was confident that the new scheme would be acceptable to the Government.

The chairman of the Meat Exporters’ Council, Mr Peter Norman; said that the agreed proposal was “genuinely and generally acceptable” to the members of his organisation. He said exporters were conscious of “losing initiative" during the period of discussion by farmers of the board’s original scheme. South Island meat companies in ; particular had worked

very hard to come up with the alternative which had now been accepted. "The meeting of minds which has occurred is that we have convinced the board that the c.i.f. price transferring arrangement under the new scheme will work," said Mr Norman. “There are still reservations among exporters that it will work.

“But the opprobrium attaching to any exporter who is caught breaking the agreed rules will be selfdestructive to meat companies." said Mr Norman. The rules are most explicit ■ on the United Kingdom market and include the right of the Meat Board to make spot audits of meat company accounts to make sure that the prices agreed upon by the Joint Meat Council are being remitted to New Zealand. The Joint Meat Council will regularly announce price levels for the United (Kingdom market and companies functioning in that market must remit the gross proceeds of products sold at these levels to New Zealand within 45 days of the date on the United kingdom import certificate. They must furnish returns to the board to show that this has been done. Also the board can order an independent audit of licensed company accounts as a further check.

Under the proposal the Joint Meat Council will also establish a pricing committee under the chairmanship of an. independent “commercially oriented” person. If an impasse on product pricing is reached, the chairman will be required to choose between the board's price proposal and that of the exporters to avoid the possibility of the board or the exporters setting “ambit” levels of price.

Under the Meat Boards new proposals for the export lamb market, a Meat Industry Trading Organisation directly owned and directed by the constituent bodies of the Joint Meat Council (50 per cent Meat Board and 50 per cent M.E.C.) will be the- owner and be responsible for all uncomnfitted lamb. Companies will be required to declare a percentage of their lamb throughput which is uncommitted and pass ownership of this proportion to M.1.T.0. at prices set by that body. The sale of the M.1.T.0. product will also be controlled by the Joint Meat Council but the companies can submit proposals for the repurchase of the product if new markets open, up. M.1.T.0. will also sell to the single buyer markets such as Iran.

“It is certainly not our intention to build a mountain

of unsold lamb/' said Mr Begg. • First call on any profits of M.1.T.0. will be the repayment of any losses which have been funded either by the trade of the board via any of its accounts. Further profits will be applied against the weekly producer schedule prices in the next year. But the schedule will be set weekly by exporters, as at present, and reflect all markets, including those serviced by M.1.T.0., in weighted proportions. Both Mr Begg and Mr Norman are confident that the new scheme will raise prices to the producers by removing the uncertainty which comes with uncommitted product held by private exporters. In return for exporter cooperation in the new scheme, the board has agreed not to automatically assume ownership of meat as it has at periods during the past. But the board will still be waving a very big stick to ensure that exporters comply with the provisions of the scheme.Options open to the board under its act are to assume control of the product of any exporter caught breaking the rules, changing the. provisions of his meat licence, and denying him further shipping space. “If we pick someone up in the spot audit checks we will hammer him, and he certainly won’t be onerating in

the United Kingdom." said Mr Begg. "The strength in this scheme is that it must be seen to hit the transgressor, and hit hard." he said. The new scheme was yesterday unveiled to the sixmonthly meeting of the producers’ electoral committee in Wellington. Two Canterbury representatives on the committee. Mr J. McLean and Mr P. G. Morrison, said yesterday that they were pleased to see the board and the exporters reach agreement. "Any weaknesses which arise can be changed in future." said Mr Morrison. “There is room left for independent exporters to work,” said Mr McLean."and this is very important to Canterbury farmers " “The Meat Board’s original proposal has been altered considerably but it was through the publication and discussion of the proposal that the board and the exporters have come together," he said. For this reason he believed the extensive consultation with farmers in the series of public meetings was worth while. Mr Begg hopes that the scheme will be ratified by a meeting of the meat and wool council of Federated Farmers in mid-September and he expects it to be in place before the start of the new meat-selling season on October 1.