Hundreds of New Zealand and Australian cattle have died in an export deal with Sri Lanka, which local farmers say has left them facing financial ruin.

Photo: 123RF

About 5000 cattle were imported into Sri Lanka as part of the scheme, with 2000 sent from New Zealand in April 2017.

The scheme was devised to improve the supply of fresh milk in Sri Lanka and reduce the country's reliance on expensive, imported powdered milk.

But farmers and animal rights groups, as well as Sri Lanka's own auditor-general, want the export project stopped because they say it is poorly planned and inhumane, with around 10 percent of the cattle imported so far dying, and many with diseases.

In a statement, MPI said the New Zealand shipment was "subject to all of our usual export approval procedures".

"All exporters are expected to meet high standards to receive an Animal Welfare Exports Certificate. An MPI veterinarian will only issue the certificate if all requirements for the welfare of the animals have been met.

"These requirements include the health status of animals before departure, meet requirements around water, food, space, and facilities during the voyage and having suitably experienced stockmen and/or veterinarians on board.

"They must also have medicines and equipment for treating any animals that become unwell during the journey."

MPI said it did not have jurisdiction after the animals arrived at their destination.

There have been no repeat shipments of cattle to Sri Lanka after controversy surrounding the fate of 2000 cows shipped there in 2017, it said. It said there have been no applications for any subsequent shipments.

Angry Sri Lankan farmers have told the ABC the "high-yielding, pregnant dairy cows" they were promised were overpriced, unhealthy and infertile.

Wellard - the west Australian live export company contracted to ship the cows to Sri Lanka and help establish the dairy farms - said the mortality rate was closer to 9 percent but overall the scheme was a success.

The company said only a "handful" of the 68 farmers selected to receive the cattle had experienced problems because they had ignored herd management advice.

SAFE ambassador Hans Kriek said that he warned the New Zealand government that this could happen.

"It has turned into a total disaster... profit seems to be more important than the welfare of animals and, in this case, the welfare of these farmers who are now in great debt," Mr Kriek said.

The scheme was underwritten by an Australian government loan of $100 million.

'I have a cemetery, not a farm'

The ABC has been contacted by multiple farmers, as well as the Ceylon Cattle Farmers Federation, to raise concerns about the scheme.

Amal Suriyage, who bought 200 cows last year, said the animals were in poor condition when they arrived in December.

"My staff said it looks like they have not come from Australia. Looks like they come from Ethiopia," Mr Suriyage said.

He said he lost about 160 cows on his Lammermoor Estate dairy farm, and another 180 calves.

He said he would be forced to cull the remaining 40 cows because some had the highly contagious disease Mycoplasma bovis.

"What I have now are carcasses of those dead cows and calves. I think I have a cemetery, not a farm anymore," he said.

Sri Lankan business consultant Mohammed Mausook Riyal told the ABC the cows were the wrong breed for the climate, making them susceptible to disease, and farmers could not make a profit because of poor milk yield and low conception rates.

Some farmers were suicidal because they mortgaged their assets to buy the cows and now the banks were foreclosing on their properties, Mr Mohammed said.

He said each cow cost almost double what it was worth, with investors paying 200,000 Sri Lankan rupees ($NZ1,700) instead of 120,000 Sri Lankan rupees ($NZ1022) per cow.

"Farmers were told each cow would produce 20 litres per day when they are only producing 10-15 litres per day," Mr Mohammed said.

He said the milk was selling for less than promised, and a special imported feed the cows needed turned out to cost more than double what they were told it would.

He spoke of one farmer who committed suicide.

"All of them have lost their dreams," he said.

"They do not know their next step in life. They have lost everything."

Cattle checked by vets, Wellard says

Wellard executive chairman John Klepec said climatic conditions in Sri Lanka were not dissimilar to other tropical areas where dairy programmes had been successfully implemented.

"I've been to one personally myself where the output of the dairy cattle are double what we experience here in Australia," Mr Klepec said.

He said the animals were inspected by Australian and New Zealand vets before export, and Sri Lankan vets certified them as disease-free when they were delivered.

"They were all passed fit for purpose, and in terms of the pregnancy issue, all the dairy heifers were signed off as pregnant when they went onto the ship," Mr Klepec said.

"What happens post delivery of the cattle is subject to the farm management. Poor farm management practices will produce poor outcomes."

He said a small "recalcitrant" group of farmers had refused to follow the advice.

"The specific mortality rate that you're referring to on that particular farm accounts for the large amount of abnormal deaths that occurred on the second shipment," Mr Klepec said.

"We're proud to be involved in a program that delivers the human welfare outcome that this program has to date - 84 million litres of milk has been produced."

Under the deal, Wellard was contracted to import 20,000 dairy cows to Sri Lanka between 2012 and 2019.

It has already shipped 5,000 and is planning to ship the remaining 15,000 in the next 12 months.

Under the terms of the project, underwritten by the Australian Government's export credit agency, EFIC, Wellard was required to provide Sri Lankan farmers with facilities, training and veterinary support.

In a statement, EFIC said it provided a credit facility to the Sri Lankan Government to fund the purchase of dairy cattle, but had no relationship with the individual farmers who purchased the cattle.

"EFIC provided the facility after the transaction was deemed to meet the necessary International Finance Corporation's Environmental, Health and Safety Guidelines," the statement said.

"The cattle were also inspected and certified by Australian authorities and accepted by veterinarians from the Sri Lankan Government before departure.

"The Sri Lankan Government has responsibility for the program after the cattle arrive in Sri Lanka."

The Ceylon Cattle Farmers Federation said farmers received no training or workshops and only received a small leaflet without any technical advice.

'An unmitigated disaster'

In a damning report published in May, Sri Lankan auditor-general Gamini Wijesinghe described the project as an "unbearable burden to the government", and said project planners had misled farmers, who had suffered "financial difficulty and mental distress".

Mr Wijesinghe found imported dairy cows were not suited to the dry conditions in rural Sri Lanka.

He said their life spans were short, their fertility rate low and they were highly vulnerable to disease.

The report said many cows and calves had died, were diseased or were languishing in poor conditions.

Mr Wijesinghe noted that as far back as 2008, the Sri Lankan Planning Department found that imported cows were "climatically unfit" for Sri Lanka.

Animals Australia spokesman Tim Vasudeva said the scheme must be stopped.

"It's been, from what we can see, a fairly unmitigated disaster from a human and animal welfare perspective," Mr Vasudeva said.

Mr Vasudeva said the situation highlighted the need for changes to welfare standards for live export cattle.

"We do have formal frameworks for the export of cattle for slaughter, but not for dairy and breeder cattle," he said.

"So basically that means those welfare protections just aren't there."

The Ceylon Cattle Farmers Association also wants the scheme stopped and farmers to be given refunds and reimbursed for their losses.

- ABC / RNZ