Sector fears 'weak' EU trade offer

The red-meat sector is concerned at reports of a poor quality draft agricultural access offer from the European Union (EU) to New Zealand.

A looming end of June deadline to conclude an Agreement in Principle was also a worry.

European Trade Ministers were due to meet this week to consider the formal revised offer to New Zealand.

However, the Kiwi-red meat sector was concerned that the EU's "rhetoric on ambition" was not being matched in the agreement, Meat Industry Association chief executive Sirma Karapeeva said.

This was due to the poor quality of past market access offers, and recent trade intelligence, she said.

"If these reports are true, then New Zealand red meat exporters would continue to face an unlevel playing field in the EU."

"We are not prepared to back a deal which offers poor access for our red meat to this important market and an outcome that would simply not be credible."

The EU had been vocal about its ambition for a broad and world-class trade agreement, Karapeeva said.

"As a long-standing trading partner with shared values and commitments to high standards, we will be extremely disappointed if the quality of the market access outcome doesn't reflect this."

Sam McIvor, chief executive of Beef + Lamb New Zealand, said agricultural protectionism sent "a negative signal" to trading partners.

McIvor said this was in "stark contrast" to statements made by the EU Commission about the importance of trade liberalisation and openness - especially at a time where food security is a global concern.

"While New Zealand and the EU have a long history of trade, we are one of the few countries that do not have an FTA with the EU, putting us in similar company to Russia, Iran, Pakistan and India.

"This puts us at a significant disadvantage compared with the EU's FTA partners, and is not reflective of the close friendship and reliable partnership between New Zealand and the EU."

New Zealand and the EU shared common societal values, a commitment to high production standards and robust regulatory frameworks for food safety and quality, animal welfare and sustainability, McIvor said.

"In this respect, a high quality and ambitious trade deal between our two governments is a natural fit - anything less is difficult to reconcile."

New Zealand's current beef market access to the EU is severely constrained by a tariff-rate quota (TRQ) of 846 tonnes with an in-quota tariff of 20 per cent.

Exports outside of this quota are subject to tariffs of 12.8 per cent of the value in addition to between €171.3 and €311.8 per 100kg - effectively this can add up to a 50 per cent tariff.

Karapeeva said the small quota and high out of quota tariff made it nearly impossible for exporters to form commercially meaningful relationships and build a stable trade in beef to the EU.

"Maintaining a small quota with in-quota tariff will do nothing to further commercial opportunities and growth to meet consumer demand," she said.

"We urge the New Zealand Government to show leadership and reject any poor quality agricultural access offer."