U.S. looks Down Under for joint lamb agreement

WASHINGTON – The United States, Australia and New Zealand reached an understanding on a proposal to enhance and sustain the U.S. market lamb after a summit meeting Sept. 25 in Washington, D.C.

After seven hours of deliberations in a small conference room barely large enough to fit 30 people, representatives of sheep industry organizations from each country agreed to a nonbinding memorandum of understanding, which they will take back their to their respective countries for further discussion.

Optimistic. While no official agreement has been reached, the representatives expressed optimism in the open and positive discussion.

“To be honest, I didn’t think we’d get this far,” said Guy Flora, president of the American Sheep Industry.

Transparency a key. The opening remarks of Chairman William Thomas, R-Calif., of the House Ways and Means Committee, set the tone for the meeting.

While he said it is difficult to get producers together to talk and think in the same ways, Thomas urged representatives to “mutually help each other” in the process – to “have as much transparency” in the proceedings as possible.

Global concerns. As each country took the floor, representatives voiced concern in the steady decline in lamb consumption and decrease in sheep numbers throughout the world.

Other concerns also dominated the day.

The summit occurred just after Saudi Arabia, the United Arab Emirates and Pakistan turned away an Australian boatload of 50,000 sheep Aug. 22, claiming more than 6 percent had scabby mouth.

The unexpected move sent the Australians scrambling to find a place to unload the animals before all 50,000 die onboard the ship – and left them considering the cost to Australia’s export outlet in the Middle East, a matter of concern for New Zealand as well.

In addition, Australia, reeling from the worst drought in 100 years, has watched its sheep numbers decline by 7 million this year – a major concern for the future, according to Rodney Watt, counselor with the Sheepmeat Council of Australia.

New Zealand outlook. New Zealand, which exports 80 percent of domestic lamb, has had to compensate for the restriction of quotas that govern shipping to the European Union.

At the same time, production has remained stable over the last decade, which may help the country compensate for the restriction in the EU, according to Andrew Burtt, North American regional manager for Meat New Zealand.

U.S. decline. In a similar vein, the United States has had to deal with such concerns as the marked decrease in American lamb consumption, an overall decline in sheep numbers and high losses to predators – a cost second only to feed charges, the American Sheep Industry Association reports.

Plenty of tension. As the meeting progressed, several areas provided some tension between parties and had to be resolved.

Representatives hotly contested the proposal’s request for numbers regarding the weekly supplies and prices on cuts of lamb in the U.S. market.

Both Australia and New Zealand objected to this request, saying that while each country collects farm-gate prices and domestic retail prices, neither has the capacity to chart retail prices in other countries.

Such a move “would require a considerable change in the mindset of the government,” said Scott Hansen, executive director of the Sheepmeat Council of Australia.

Part of the problem also stemmed from the differing sale practices of Australia and New Zealand, as opposed to the United States.

New Zealand engages in cooperative sales while Australia implements free market sales, which means, as Hansen said, “A flat tire on the major buyer’s car means he doesn’t make it to the start of the sale, which means half-price [for the producer].”

Conversely, the United States has made it a federal law to report prices daily and submit the data to a USDA database routinely.

Moving forward. Representatives reached a consensus by requesting reports on the “volumes of supply and key farm-gate, wholesale and retail prices” and agreeing to work together in improving data collection, according to the memorandum of understanding.

Drug standards. Another topic of discussion was the difference in availability of pharmaceuticals and biologicals in the United States, as compared to Australia and New Zealand.

As the memorandum stated, in the final discussion, representatives agreed to “explore the disparities of pharmaceutical and biological availability in all three countries.”

Meeting again. While no document has been signed or official organization formed, the group agreed to meet next year.

Australia offered to host the next meeting, with a tentative date of November 2004.

Organizations forming the group are: the American Sheep Industry Association, National Lamb Feeders Association, Sheepmeat Council of Australia, Meat and Livestock Australia, Meat New Zealand and Federated Farmers of New Zealand.

From the United States, members from the American Lamb Board, California Wool Growers Association and Texas Sheep and Goat Raisers’ Association also attended.