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The hunt for the missing billion: NZ’s dairy beef opportunity.

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Executive Summary

Purpose:

To analyse and investigate the opportunity to develop a stronger Dairy Beef Industry from New Zealand ’ s growing Dairy Industry.

Method:

  1. To understand the existing Dairy Beef industry in New Zealand and identify the strengths, weaknesses, opportunities and threats within the existing framework
  2. Identify and analyse the existing value chains
  3. Identify opportunities to develop further value

Findings:

New Zealand has an established and functional Dairy Beef industry. Existing value chains and enterprise options are available to farmers that can meet the needs and demands of different markets within the New Zealand pastoral farming sector.

A significant resource of animals is created by the New Zealand Dairy industry annually. Information available indicates 2.3 million calves are not making it beyond 4 days of age.

The prospects for the Global Beef industry suggest that there is an opportunity for New Zealand to grow more Beef to meet strongly growing global demand over the next 50 years.

New Zealand has an increasing share of it’s food exports being sold to China, and a Meat schedule market in New Zealand that has been stable for a number of years.

As the New Zealand Beef cow herd continues to shrink, growth in New Zealand’s total Beef production can realistically only be expected to come from a larger Dairy Beef industry.

Significant prejudices and stigmas exist among New Zealand Beef rearers and finishers toward Beef Cattle with Dairy ancestry (especially Jersey) and large value discounts are applied because of this. Information available does not support these beliefs and, in instances, proves them incorrect.

The possibility of sexed semen provides opportunity to improve the productivity and rate of genetic progress in the New Zealand Dairy industry and also for the Dairy Beef industry to expand.

The prospect of rearing more Calves from the Dairy Industry, sired by Beef Bulls, feeding them for a shorter duration on high performance pastures and forages, provides a pathway to much more efficient and profitable Beef production in New Zealand.

It is imperative that Beef Bulls used by Dairy Farmers are appropriate and do not interrupt the primary purpose of the Dairy Cow: to produce Milk.

Recommendations:

  1. Further research in to the number of Calves being born on New Zealand Dairy farms annually, and the fate of those Calves, is recommended. This will allow an accurate picture of existing Farm practices and the inherent opportunities and risks that exist.
  2. For New Zealand Meat Processing Companies to adjust payment schedules that reward Meat Quality and saleable meat yield, rather than the current fatness and muscularity measures which penalise Carcasses of Dairy ancestry and reward those of accepted Beef ancestry.
  3. That information to hand regarding Meat Quality , and breed effects, be distributed among the Beef Industry in an effort to prevent or reduce the value discounts toward some breeds.
  4. That the findings of the Beef and Lamb NZ, MPI Sustainable Farming Fund initiative to finish Beef Cattle by 20 months, be rolled out further and encouraged.
  5. That Case Studies of Farming businesses successfully taking Crossbred Dairy Beef Cattle through to slaughter be identified and exhibited to demonstrate what can be accomplished.

Conclusions:

New Zealand has a significant opportunity to become much more efficient in its Beef production and capture the opportunity of Global Beef demand growth. A very large resource of potential Beef Cattle is born and available annually from the New Zealand Dairy industry.

Only a small portion of that available resource is being reared annually and of those reared, many are being carried through to slaughter at 30 months or older, requiring a second Winter and the poor Feed Conversion Efficiency that goes with it. Better utilisation of the findings of the Beef and Lamb, MPI work in this area, would see improvements to Farm systems that create much better returns to Beef Finishers and allow greater throughput of Livestock.

The Dairy industry has vulnerability in how some farms deal with this particular by-product and there are risks inherent which need to be planned for. Having a Dairy Beef industry that is able to transform as much of that by-product as is practically possible, is an important component in managing the public relations risk.

A better understanding of the inherent Meat Quality and Meat yield characteristics of Dairy Beef cattle among Beef Rearers and Finishers and Stock Agents could be expected to see much better acceptance of those animals in Livestock Markets and stronger underlying value which would lift 4 Day old values.

The Hunt for the Missing Billion: NZ’s dairy beef opportunity – Alan Cook