NZ cattle infection outbreak under control

WELLINGTON, 28 July 2017: 

New Zealand’s first outbreak of a serious bacterial cattle disease was well under control, the Primary Industries ministry said today – with stock movement restrictions in place and testing continuing.

News of the discovery of mycoplasma bovis earlier this week on a single farm in the world’s largest dairy exporter briefly knocked the local currency lower, given the importance of the industry to New Zealand’s economy.

The ministry said movement restrictions had been placed on 16 individual properties after the infection was confirmed at one farm in the Van Leeuwen Dairy Group, a large scale dairy business on the country’s South Island with some 12,550 cows.

“At this time we are still determining the scale of this situation through on-farm sampling and testing, and tracing of movements of stock on and off the properties,” the ministry’s regional controller Dr Chris Rodwell said in a statement.

The ministry said a farmer had euthanised a small number of animals voluntarily for animal welfare reasons.

The disease, which is common in many countries, can have a serious effect on cattle – but does not infect humans or present food safety risks to milk or milk products, the ministry said.

The infection is spread by close contact between animals and not across big distances by wind or water. It can also be present in milk and be transmitted to other cows in that way, it added.

The New Zealand dollar was slightly lower on the day, having touched its highest in over two years in the previous trading session.

Analysts said there had been concerns of a knee-jerk reaction to news of the disease that could affect market access for New Zealand’s diary products.

“But that doesn’t seem to have happened with the passing of time already, so at this point we are thinking it is going to be a relatively small issue,” said Doug Steel, senior economist at BNZ.

Meanwhile, Japan’s Ministry of Finance (MoF) today said the country will raise tariffs on frozen beef imports from the US and other countries from August to protect domestic producers.

Tariffs on frozen beef will jump to 50% from the current 38.5% between Aug 1 and the end of March next year – as a “safeguard” mechanism to protect domestic farmers is being triggered, the ministry said in a statement.

The increase will be the first time the tariff mechanism has been tripped for beef imports since it was last triggered for chilled beef in August 2003, the farm ministry said.

The increase threatens a significant sector of United States’ access to the biggest Asian market for US beef overall, just as president Donald Trump is trying to expand American exports to Japan. US frozen beef exports to Japan last year were worth more than US$400 million.

“The safeguard will not only have negative implications for US beef producers, but will also have a significant impact on the Japanese foodservice industry,” said US Meat Export Federation (USMEF) president and CEO Philip Seng in a statement on the organisation’s website.

The tariff hike will be especially hard on gyudon beef bowl restaurants that rely heavily on US frozen beef cuts as a primary ingredient, he said.

A tariff increase is automatic if quarterly imports for specific types of beef products – both from all nations and from those that do not have economic partnership agreements (EPAs) with Japan – rise more than 17% from a year earlier.

In April-June, Japan’s first fiscal quarter, frozen beef imports from all nations totalled 89,253 tonnes, up 17.1% from a year ago, and imports from non-EPA nations reached 37,823 tonnes, up nearly 25%, government data showed.

Nations that have EPAs with Japan, such as Australia, Mexico and Chile, will be excluded from the hike in tariffs.

Japanese finance minister Taro Aso said the government has been contacting affected nations such as the US to explain the increase, Kyodo news agency said.

No safeguard or increase will be triggered for chilled beef imports as the volumes did not exceed the required level.

Japan’s beef bowl restaurants suffered tremendous setbacks when US beef imports were previously curtailed, and were “finally enjoying robust growth due to greater availability of US beef,” USMEF’s Seng said.

US sales of frozen beef cuts to Japan last year were worth US$418 million, making up around 18% of total US frozen beef sales, according to data from the US Census Bureau.

For the period January-May this year, total US beef exports to Japan were valued at US$731 million, up 32% from the same period in 2016, the same data showed.

By volume, total US beef sales to Japan for January-May came in at 123,290 tonnes, compared to 96,394 tonnes a year ago. Overall US beef exports for the first five months of the year were 497,323 tonnes.

– Reuters

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