Iranian requirements for its own vets and mullahs stymies meat export trade

New Zealand meat exports to Iran haven't resumed following the lifting of sanctions this year, because of Iranian restrictions for one of its vets and a mullah to be present at the time of processing.

Along with other Western countries, New Zealand lifted sanctions against Iran in February after the country agreed to roll back its nuclear ambitions. However New Zealand's meat trade to the Middle East's second-largest economy hasn't resumed despite the lifting of sanctions, with trade data from Statistics NZ showing the last shipment was over a decade ago.

Iran was an important sheepmeat market for New Zealand in the 1970s and 1980s when the country's sheep flock swelled on the back of agricultural subsidies, taking one in every four animals exported at the height of the trade, according to the Meat Industry Association. However at that time New Zealand had an abundance of product to process, and shipped carcasses to Iran which made it easier to comply with the requirements for a vet and mullah to be present. These days, animals are divided into a range of cuts for distribution to specific global markets and New Zealand has developed its own halal standards overseen by the Ministry for Primary Industries.

"To import product, they say they need to have an Iranian mullah and an Iranian vet to be on site at the time of processing," association chief executive Tim Ritchie told BusinessDesk. "That's the stumbling block. It's their insistence that they have their own people at that processing plant whenever product is processed or produced for export to Iran. They haven't accepted New Zealand's regulatory system."

New Zealand is unlikely to create a special regulatory framework for exports to Iran because it would undermine the country's existing standards which are recognised globally, although individual processors could choose to fund an Iranian mullah and vet to oversee their New Zealand production if they saw it as commercially viable, Ritchie said.

However, he suggested this was likely to be challenging given how animals are now processed, with chilled legs shipped to supermarkets in the UK, racks to North America, loins to Switzerland, shoulders to the Middle East and breasts, flaps and lower-value cuts to China.

"They are not producing carcasses for export, they are producing a whole range of cuts as every animal is broken down into all its various bits and that bit is exported to wherever in the world they can earn the most revenue, whereas if you go back to the earlier business with Iran in the 70s and 80s they were carcasses," Ritchie said. "Our business model has evolved into one of breaking the animal down into cuts, and exporting throughout the world, so it's unlikely that the companies would go back to providing carcasses because in effect they have other homes for various parts of that animal.

"The industry's model has a reasonably sophisticated production and exporting system in place and Iran would have to be willing to pay that world price for that particular part of the animal in order to attract the business."

Ritchie said the outlook for New Zealand meat exports to Iran was uncertain.

"It will come down to the need of Iran for our product and its ability to conclude a package with individual export processors to do a deal. I would suspect it's unlikely that there's going to be a whole New Zealand wide thing given Iranian insistence on vets and mullahs," he said.

"Clearly we would like to reopen that business, they are a massive country and have been a very important part of the industry in the past and it would be good to be part of it in the future."

(BusinessDesk)

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