Background to the MGB programme
Internationally, high-quality beef is usually produced from cattle housed in feedlots and fed corn and other grains. As a result, there is consumer demand for grass-fed, free-range, high-quality beef.
Much of New Zealand's beef is lean and destined for use in burgers and smallgoods. MGB aimed to develop premium, high-quality, marbled, grass-fed beef that is internationally recognised for its superior eating qualities. This would be more profitable to all parts of the value chain.
MGB was a 7-year Primary Growth Partnership programme between:
- the Ministry for Primary Industries (MPI)
- Firstlight Foods Ltd and Firstlight Wagyu (NZ) Ltd
- Brownrigg Agriculture Group Ltd.
MGB used Wagyu sires with high-marbling genetics crossed with dairy and Angus dams to produce cattle with 50% Wagyu genetics. The programme also developed rearing and grazing systems to support year-round growth of these cattle.
Find out more about the MGB programme
Evaluation of the MGB programme
As part of its monitoring process for PGP programmes, MPI commissioned an independent evaluation. This looked at:
- outcomes and benefits
- programme execution
- any lessons.
Download the MGB evaluation report [PDF, 2.2 MB]
What the evaluation found
The overall finding was that MGB was a "successful and worthwhile" programme for all parties. The programme's major achievements and benefits include:
- First Light grass-fed Wagyu can be produced year-round, to provide consistent and reliable supply
- 80% of First Light Wagyu cattle are now from dairy industry calves, providing a higher-value alternative for bobby calves
- the go-direct marketing model is well established in New Zealand and on the west coast of the USA, and both markets are expected to grow
- progress has been made towards a farm-gate price premium target of $2.12/kg for First Light grass-fed Wagyu
- First Light grass-fed Wagyu has achieved premiums of $0.80 to $1.22/kg throughout the programme. This reached a high of $2.93/kg in April 2020 during disruptions to the global market due to COVID-19
- processing numbers are increasing and will soon reach 20,000 head of cattle per annum
- a target annual volume of 30,000 head of cattle is feasible by 2025/26
- farmer support and feedback shows that adding Wagyu to their operations has been profitable
- First Light grass-fed Wagyu is profitable, and produces higher returns than typical prime beef operations
- farmers, processors, and retailers see social or "values-based" benefits
- the MGB value chain has been profitable for everyone involved
- there is value in working closely with in-market partners, and cooperating to create products that consumers want
- it's possible to create a product that's worth more by growing it the right way in the right place
- the economic benefit-cost ratio from the programme is 2.0, confirming that it has been a worthwhile investment.
The lessons learnt include:
- farmer support is required to improve performance and increase scale
- farmers will be more supportive of change if they believe in it, instead of just looking at increased profits
- parts of the value chain needed to be streamlined, and connections and communication needed to be improved
- the governance approach of the Primary Growth Partnership (now Sustainable Food & Fibre Futures) can be integrated into the way industry co-investors operate
- programmes run better when staff turnover is low
- it's helpful for people starting in governance roles to go through a good "on-boarding" process to make sure they understand the role of governance
- programme partners can benefit from continuing work together even after the programme finishes.