Domestic Trends and Measuring Progress against the Red Meat Sector Strategy Red Meat Sector Conference 2013 Auckland 8 July 2013 P13035

Red Meat Sector Strategy Metrics Vision for In-market Activity Offshore Competition and Export Performance Domestic Trends Outlook for

Sheep and Beef Sector Returns Export and Domestic, Constant $

Share of Retail Price of New Zealand Lamb sold in Britain

Market Access FTAs under negotiation TPP, Korea, Chinese Taipei, Russia, India Future FTA focus EU, Regional Comprehensive Economic Partnership (RCEP) Other EU and non-EU Europe Latin America North Africa & Middle East

World Exports – Lamb Chilled & Frozen – December Year 2012

World Exports – Beef Chilled & Frozen – December Year 2012

Export Lamb Receipts

Export Beef & Veal Receipts

China Imports – Lamb Chilled & Frozen – March Year

China Imports – Beef Chilled & Frozen – March Year

USA Imports – Beef Chilled & Frozen – March Year ,000 tonnes 280,000 tonnes

Land Use Trend

Key Land Use Changes e Hill Country Farms (no.) 7,5006, % Finishing Breeding Farms (no.) 12,1006, % Hill Country Farms (eff. m ha.) % Finishing Breeding Farms (eff. m ha.) % Dairy Farms (no.) 14,68511, % Dairy (eff. m ha.) % Commercial farms, excludes lifestyle blocks Source: Beef + Lamb New Zealand Economic Service Statistics New Zealand

NZ Sheep and Cattle Numbers to

Productivity Comparison e Lambing Percentage (ewe)100.4% 123.3%+23 lambs Hogget lambs as % all lambs-5.4% Average Lamb Weight (kg) % Lamb sold (kg/ewe) % Wool Prodn (kg/head greasy) % Average Steer Weight (kg) % Milksolids per cow (kg)260340*+31% * To be revised

Export Sheep Processing p CompaniesNo.1716 PlantsNo.3736 Year Kill000*24,30022,84725,043 Max Weekly Potential000*1,2441,1811,269 Highest Week000* Av per Week000* Av as % Potential 38%37%38% Av as % Highest Week 53%50%49% Weeks at Highest WeekNo * Lamb equivalents – one sheep equals 1.15 lamb equivalents Source: Beef + Lamb New Zealand Economic Service

Export Cattle Processing p CompaniesNo PlantsNo Year Kill0002,2762,0862,303 Max Weekly Potential Highest Week Av per Week Av as % Potential 48%47% Av as % Highest Week 53% Weeks at Highest WeekNo Source: Beef + Lamb New Zealand Economic Service

Export Lamb Slaughter September Year

Export Cattle Slaughter September Year

Export Lamb Price All Grades – Weighted Average

Export Bull Price M Bull (270–295kg) – Weighted Average

KPIs Price levels – meat, wool, currency low control Lambing/calving % farm control Wool Production per sheep farm control Livestock weights/growth rates farm control Loss rates farm control Fertiliser per ha or per SU farm control Farm expenditure per ha, SU farm control Gross Margins farm control Rate of Return land asset, external Debt : Equity important if high debt

Summary Prospects for –Recession continues in Europe –Signs of recovery in the US and Japan –Emerging markets still growing rapidly –Post-drought environment Sustainable profitability in tough environment –Accepting and managing volatility –Continuing gains through livestock performance and operational efficiency Red Meat Sector Strategy measures –Track progress and have reflected the difficult season –Focus conversations, thinking and actions on long-term

Domestic Trends and Measuring Progress against the Red Meat Sector Strategy Red Meat Sector Conference 2013 Auckland 8 July 2013 P13035