Quota Allocation Mechanism Review 2023-2024
Background
At intervals not greater than five years s.29 of the Meat Board Act 2004 (the Act) requires the New Zealand Meat Board (NZMB) to review each unrevoked allocation mechanism.
Access for beef and sheepmeat has increased recently with the advent of the UK and EU Free Trade Agreement tariff rate quotas (FTAs). This is additional opportunity to New Zealand’s long standing access via World Trade Organisation (WTO) quotas. New Zealand now has nearly 300,000 tonnes c.w.e. sheepmeat and goatmeat with tariff free access to the UK and EU, while shipped exports globally are 392,000 p.w. tonnes of lamb and mutton.
Beef access has increased by 18,313 tonnes (14,980 tonnes p.w. and 3,333 tonnes c.w.e. (pro-rated in the first year)) to EU/UK with scheduled (2,980 tonnes p.w. and 953 tonnes c.w.e.) increases on an annual basis.
More Quotas
NZMB now has responsibility for the administration of ten quotas (WTO – EU and UK Sheepmeat and & Goatmeat, EU and UK High Quality Beef, US Beef &Veal, FTA - EU and UK Beef, UK Sheepmeat, EU Sheepmeat and Goatmeat chilled and frozen).
To support this quota allocation mechanism review NZMB commissioned an economic study of allocation mechanisms by Castalia Limited focused on determining which allocation mechanisms (if any) would best assist the NZMB in achieving its object.
Consultation Proposals
NZMB proposed maintaining a production history allocation mechanism for the WTO quotas where volumes are fixed and a modification to the transitional allocation mechanism for the new FTA quotas which increase in volume year on year.
UK and EU FTA sheepmeat and beef Quotas
For the new FTA quotas, which have annual increments in quota volumes, NZMB proposed a modification to the transitional Production History/Export History hybrid system in place, to one in which quota allowances are allocated based on Export History alone. The proposal for Export History alone was not supported and the hybrid Production History/Export History allocation mechanism remains.
For WTO (EU and UK sheepmeat and goatmeat, HQB and US beef and veal) Quotas
The NZMB proposed no change to the existing allocation mechanism, i.e. three year average of production history.
Changes were proposed to the new entrant provisions however.
It was proposed that any registered meat exporter be eligible to be a new entrant, that new entrants have access to the 2% new entrant tranche (RQA) on a first come first served basis, with a limit of 30% for any single entity on a certificate by certificate basis. New entrants may access any handed back quota after GQA holders have done so.
Consortium provisions were also removed.
New Entrant Provisions Review - September 2025
The QAMR 2023-2024 review introduced a simplified application process for new entrants, including holding two percent of WTO quota for new entrants and, if it was not used, reallocating this to existing quota holders in the fourth quarter of the quota year (from 1 October for calendar year quotas, or 1 April for HQB quotas).
Some existing quota holders have asked for this to be reviewed, so that unused quota is available to existing quota holders as early as possible in each calendar year.
The NZMB has considered what could be done to provide more flexibility while maintaining a reasonable level of access for new entrants. Three options for balancing the interests of new entrants and existing General Quota Allocation (GQA) holders are being consulted on:
- Status quo. Two percent of quota is reserved for new entrants each calendar year, available to them on a first-come-first-served basis, limited to 30 % for any single entity. If unused, this quota is handed back and reallocated in October.
- Apply 80% rule. Existing quota holders (GQA) who have sold/used 80% of their allocated quota for a year can apply for the reserved two percent in the same way as new entrants (first-come-first-served, up to 30 % for any single entity).
- Earlier access to reserved quota. This would divide the allocation of reserved quota into two half-years. For the first six months, only new entrants would be able to access the two percent reserved quota. If less than half the reserved quota is allocated after six months, then it would be available to both new entrants and existing quota holders who have sold/used 80% of their allocated quota.
A consultation document with more detail is available here. NZMB Is seeking feedback on these options and to have your say, use the feedback form.
Supplementary material
Links to documents below are:
- Castalia Report
- Consultation document - February 2024
- New Entrant provisions consultation document - September 2025