Dealing with Australian Grass Fed Beef Industry Issues

Australian Beef

Chairman’s Letter to Members – March 2011

Brad Bellinger

The new edition of the ABA’s Beef Producers Journal is now available at either country NSW Newsagents, or contact the ABA Office on 07 4691 2618 for a copy titled Brazil – a New Approach to Beef Production, which includes what is going on behind the booming Brazilian Agriculture sector in general and JBS Swift in particular. (All ABA financial members should have received a copy of our Journal in early January.)

Queensland Country Life’s beef journalist, Brad Cooper, recently wrote that the ABA is “irrelevant”. He obviously is unaware of our three great achievements in 2010/2011; – issues that the others have ignored.

1.Imports from BSE afflicted countries – Great win for the ABA

Canberra recently announced an indefinite period for the USA under ‘Stop the Clock’ provision for Import Risk Analysis. Bio-Security has not yet received information that they sought months ago from the United States Department of Agriculture (USDA) regarding cattle health status, inspection and certification systems.

Until Bio-Security receives this information any time that elapses will not be considered as being within the period of 24 months for the Import Risk Analysis.

This is very good news, as it buys us more time. There would be a flood of high quality US beef enter Australia without the ban, as our exchange rate and our cattle prices would see the supermarkets importing, as they do with pork. Once city people got a taste for US Choice graded beef, we would have great trouble competing. They can produce beef so much more cheaply than we can.

Stopping the US Beef imports has been ABA’s single greatest achievement – against the policies of Cattle Council, the Federal Government, the Meat and Livestock Australia (MLA) and all the Canberra Departments. We have saved our industry – for now.

2.RFID NLIS-Canada joins the US in fighting introduction of a RFID NLIS – ABA was right

Australia has been left as the World’s guinea pig on National Livestock Identification System (NLIS) using Radio Frequency Identification (RFID) tags. Despite being told by MLA seven years ago that other major beef producing countries had, or were to adopt RFID NLIS, we have been left isolated with the NLIS ‘white elephant’.

At the MLA AGM in Perth in 2003, a Canadian Cattle Councillor addressed the meeting and told us that we would lose our market share in Asia, if we didn’t follow Canada into individual NLIS. Our then ABA Chairman John Carter asked if he knew that we already had had one for ten years. Mr Carter was then so severely attacked by Cattle Councillors (led by the motivator for RFID NLIS – John Wyld) that when a woman censured the MLA Chairman on his conduct of the meeting, she was warmly applauded.

Our Cattle Councillors didn’t know that our tailtags had an individual number for ID of carcasses! Like the US cattlemen, Canada’s producers will almost certainly win against the push for NLIS RFID, –despite a 19th case of BSE found this month, leaving us the suckers in the World’s export markets. We have been dreadfully lied to by people with vested interests. The ABA has been alone, with its opposition for the mandatory RFID NLIS over the past seven years.

3.ABA’s highlighting of Supermarket “rip off” is proven
ABA was the only rural organisation to do a detailed Beef Submission to the 2008, ACCC Grocery Inquiry. The MLA and CCA kept well away. Coles and Woolworths claimed that they only had 3% and 17% respective “mark ups” on beef. We did our arithmetic on costing a fully minced carcass for retail and came up with over a 100% “mark up”. No staffer at the Australian Competition and Consumer Commission (ACCC) disagreed with our work but Mr Graeme Samuels (the Chairman, ACCC) didn’t want to know, nor was he listening to the evidence presented to him. Supermarkets were then charging $14-15/ kg for mince.

They have now dropped their prices by over 20% and domestic cattle prices have risen by over 20%. ABA was right.

As the MLA refuse to do it, ABA will regularly publish Australian producers’ share of the consumer dollar based on the USDA formula.

4.R & D Expenditure
The Federal Government is to release findings into R & D (Research and Development) expenditure through the Productivity Commission next month. The ABA has made three submissions into this Inquiry, with the latest refuting claims by MLA that producers have illustrated support for the MLA at their November AGM. With only 2.5% of eligible producers participating in the vote and less than fifty large producers/processors have the ability to control the vote; the lack of democracy is clearly evident.

The ABA has revealed in their submission that 25% of R & D of MLA money is allocated to companies that nine MLA Directors have direct involvement with.

Following our attempt to wind up the MLA at their AGM in Launceston, some producers have asked for us to put forward an alternative structure. The ABA asks for input from producers on their thoughts for an alternative Meat Industry Structure, or indeed if you think we need any meat marketing authority at all please; – let us know.

R-CALF USA catches out the US NBCA.
R-CALF has caught out the US equivalent of our RMAC on the misuse of $250,000 levy money and there is a Federal investigation in progress.

“Evil prospers when good men do nothing”.

Brad Bellinger
Chairman of ABA