High Court ruling on PSA may have stinging repercussions for MPI on mycoplasma bovis claims. Shows biosecurity risks need to be taken more seriously by Government

The Ministry of Primary Industries (MPI) must view the High Court land-mark ruling regarding the kiwifruit PSA disease with increased concern. The court has upheld the claim 212 growers group action took against MPI for $400 million.

The substance of the claim was that in 2010 MPI were negligent in their actions for controlling what products could be legally imported to New Zealand.

Move onto 2017 and the current mycoplasma bovis (MPB) outbreak may have some have similar circumstances. Currently, the source of how MPB arrived in New Zealand is unproven, but some believe it may have arrived via legally imported semen. Given, New Zealand along with Norway were considered to be the only countries in the world not to have the disease and now the concern the disease has raised since its arrival, questions have to be asked as to why MPI didn’t have it on their radar list.

Unlike the kiwifruit growers, farmers who have been affected by the disease and have had to destock are entitled to full compensation, however this privilege does not extend to those how have suffered from the disease prior to MPB being confirmed. This would include cases such as the calf rearer in Palmerston who ended up loosing her business and arguably her relationship with her partner.

Also, unlike the kiwifruit industry where packhouses where not considered to be financially affected, arguably milk processing companies who have been relying upon the milk from the destocked farms are also out of pocket. It could also be argued that given the large decrease in bull calves being reared this season that the calf rearing industry plus the bull beef finishing sector also will have a legitimate gripe with whoever let MPB into the country.

In the meantime the potential $400 million PSA, ruling if it is carried out (MPI have 20 days to appeal the ruling), plus the $600 million or there-abouts MPB is expected to cost tax payers should be making those in Government sit up and look at how New Zealand’s borders are being or perhaps not being protected and considering whether a far more pro-active approach needs to be taken.

Going back to when the budget was announced, Treasury’s risk analysis paper on general risks to the economy didn’t see bio-security as a major risk as “they usually occur infrequently and cannot be predicted” and “once they occur then choices arise about how to respond”. So, given this attitude behind the scenes it’s not surprising the preventative measures have not been high on the schedule. Surely this attitude is overdue for a rethink.

The major influence on the market this week is the kiwi versus US dollar. Dropping to below 68cents has shown dividends for several products ranges.

Lamb meat has risen by 10 cents a kg on several processors schedules and mutton has held its price. North Island lamb finishers have had an $8 July contract waved under their noses it will be interested to see if this extends to the South Island.

I am in Australia at the moment and it is interesting to see that New Zealand and Australian sheep meat prices are tracking each other fairly closely with the Cootamundra bench mark price for 22 -24kg lamb at AU$7.38 per kg CWT and mutton at AU$5.15. Convert these back to NZ prices and with the exception of the two large South Island processors who don’t play the true schedule game (See Allan Barber’s article) , New Zealand farmers are close although a few percent behind. However, given the size of Australia’s domestic market, understandable.

Wool prices at last weeks joint Napier and Christchurch generally rose across the board although the volumes of wool at the finer end were low enough to not be used as a great market gauge. However, the coarse cross bred wools were up by 2-3 cents per kg.  

Different processors had lifts over a range of products with beef. Prime beef had small lifts from one processor at the higher weights. Perhaps indicating that the export targeted carcasses were where the signals are being sent and Cow, both prime and manufacturing also got some benefit.       

Venison is keeping its margin ahead of lamb with another 10c per kg from one processor lifting the South Island Stag price to $11.20 on schedule.

We welcome your help to improve our coverage of this issue. Any examples or experiences to relate? Any links to other news, data or research to shed more light on this? Any insight or views on what might happen next or what should happen next? Any errors to correct?

We welcome your comments below. If you are not already registered, please register to comment or click on the "Register" link below a comment.

Remember we welcome robust, respectful and insightful debate. We don't welcome abusive or defamatory comments and will de-register those repeatedly making such comments. Our current Comment policy is here.


Negligence full stop. Appears to be a government department having their first concern on authority but with little regard to the accompanying responsibility.

I'd put it another way. Tax payer 'insurance' for our primary industry's.

A stitch in time saves 9.

True perhaps, but if you use weak inferior cotton it will eventually, do the exact opposite.

if on the other hand you spend 9 years running down such services to the point they cannot function and as a Govn act in such a way that it is clear "anything goes" then not really. Of course the CEO/head of the Govn dept should have had the balls to stand up and say to the Govn / minister of the time this is a probable risk. Of course his/her job would then have been at risk and since the Govn probably has a yes man in place anyway wasnt going to happen.

This may have significance well beyond just MPI. It is pretty rare for any government departments to be held to account for their irresponsibility.
My dealings with MPI indicates that they are a bunch of nice scientists and administrators but without any sense of urgency, responsibility or strategic nous.
The management needs to be replaced with something more like the military.

or maybe we should consider that the Minister responsible for 9 years should be so held, fat chance.

The really sad thing is that I think that the National party deliberately emasculated them by rolling them into MPI so that they would not be so resistant to importation of foreign goods and so upset China et al. National did so much harm in their time at the helm. Poor old Labour are having to rebuild so much. I just wish that they had a bit more nous however.

This is not entirely correct Unlike the kiwifruit growers, farmers who have been affected by the disease and have had to destock are entitled to full compensation
Compensation was paid to early affected kiwifruit growers who removed infected trees Financial compensation for growers who agreed to cut out infected orchards to reduce the inoculum burden and control disease spread in the early stages of disease management. These have since been discontinued. http://www.kvh.org.nz/vdb/document/91146

On a related note, I read this today out of Australia!

"An international conspiracy to profit from bovine blood products illegally smuggled into Australia has been unearthed in a Four Corners investigation.

The Department of Agriculture has confirmed it has seized 13,000 litres of foetal bovine serum (FBS) which it says, "pose an unacceptable biosecurity risk".

Much of this material was originally sourced from banned South American countries with a history of potentially-devastating animal diseases, including foot and mouth.

Four Corners has also confirmed the mislabelled serum was being unwittingly used directly with live cattle by Australia's peak scientific body, the CSIRO, in stem cell experiments designed to create a new and more profitable breed of cattle.

The exposed cattle, which were grazed on a CSIRO research property near Armidale in NSW, were quietly destroyed in the wake of the extraordinary biosecurity breach.

"What protected Australia from foot-and-mouth was sheer luck," said former GE Healthcare senior executive Brian Hood."