Just how long that will take to reverse will depend on how long it takes people to be comfortable to eat out in restaurants again.
The key for New Zealand across the supply chain will be maintaining integrity, reliability and consistency.
“That will stand us in good stead to be able to deliver long-term.
“Maintaining the normal supply of livestock while keeping transport and shipping as normal as possible with case-ready retail product to meet new consumer demand will be the new norm, at least for the short term.
“Producers, processors and exporters will need to change to meet the new demand of people now buying at retail.”
Burtt said food services are down phenomenally with beef most affected.
“Beef is the most sold with a higher reliance on the food service sector, the tenderloin and steak cuts markets have just died a death and the United States has made a start on grinding more middle cuts into beef products.”
With a backlog of domestic product, the US Department of Agriculture has also introduced a new country-of-origin labelling law, which, at least for the short term, is mandatory for US product at retail sale.
The new law does not apply to the food service sector.
With lamb there is greater opportunity for NZ to have an input.
“For us with lamb we can act as an intermediary between the food service and retail as with customers in both camps we can help make the shift and that ties back to our abilities to provide product to meet demand.
“Big box retailers such as Walmart and Cosco are doing phenomenal business at retail.”
NZ exporters are working with their partners on options for reaching consumers and exploring channels with an increased emphasis on retail options and the logistics of timely shipping.
“From what we are seeing it looks like our processors will have sufficient capacity to cope and I believe they are doing all they can to maintain connections and integrity of their supply chains to the market.”
Burtt said while dealing with the significant upheaval of covid-19 and short-term volatility no-one is so brave as to speculate on the long term.
The situation around swine fever in China should not be dismissed, Burtt said.
“There’s a real indicative there of what protein demand is in China and there’s strong international demand for red meat – of course, with some short-term volatility and competitive element with both competing meats and non-competing meats.
The short-term impact from the closure of 17 US processing plants has seen US pork production drop 10%.
“Here farmers need to keep their eye on what’s happening in international markets.
“We need to be mindful animals are still growing and of how we slow that growth while we wait for markets and slaughterhouses to open again.
“The cattle and pigs that left the farm this week could be the last for some time.
“We could have a three to six-month timeframe, we really just do not know.
“It’s about putting livestock on a slow growth feed system to keep them ticking over while waiting for the opportunity to export them.”
This opportunity could well be with China.
“We could be in the race to contribute more to China’s protein shortage and as well see a flow through to new opportunity for NZ on the Euroopean Union scene.”
In the bigger picture post covid-19 there is a positive stick for NZ’s red meat markets.
“It’s not all doom and gloom for the next 12 months.
“NZ needs to get the right balance keeping eyes on the short-term volatility but also having an eye on the longer term.
“If the world is going into a depression, food consumption and production is a basic need for all of us and the NZ red meat sector is in a good business for that.
“We have got good diversity of country markets and then also within each individual country’s market segments.
“If we keep our reputation of integrity, reliability and consistency in quality and supply we will come out the other end.
“There will be humps and bumps and global volatility as we traverse through these unprecedented times of covid-19 but we will come out of this,” Burtt said.
