The seed levy order, backed by 91% of growers, has been approved by Cabinet.
Federated Farmers herbage seedgrowers chairman Hugh Wigley said the levy safeguards supply of non-proprietary and uncertified seeds.
“Grasses and clovers are vital to our sector but contracts for growing from proprietary seed are not always available and are more expensive.
“This levy provides different options to our farmers.”
The Commodity Levies (Non-proprietary and Uncertified Seeds) Order, known as the Commons, was first mandated in 1997 when the responsibility for maintaining the cultivars was transferred to the industry from the government.
Levies are collected from the Commons including Nui, Moata, Manawa, Tama, Ruanui, Huia and Pawera, as well as uncertified ryegrass and red and white clover.
Wigley said for the Commons to continue to be publicly available, live nucleus and pre-nucleus seed of each of the Commons must be maintained to make both breeder seed and basic seed available to growers.
“It costs about $180,000 for Grasslanz Technology to ensure this base material is available to growers.
“About 15% to 20% of this material comes from the commercial sale of breeders and basic seeds while the remainder comes from the levy.”
The levy is collected on behalf of Federated Farmers by all seed testing stations on the first purity and germination test.
It is set at a fixed per kilogram cost on the projected harvest of each of the Commons seeds and the estimated kilogram price received by the growers.
The maximum levy rate is 5% though it is typically around 1.5% to 2%.
“Federated Farmers doesn’t make any profit from the levy. It’s only about generating enough revenue to pay Grasslanz Technology.
“It’s an industry-good activity we do for the sector and to have growers affirm support for the levy is satisfying and means that these cultivars will continue to be available for growers over the next six years,” Wigley said.
