Victorian meat supply chain will remain open

“The two key parts of these restrictions for our industry is reducing the daily peak capacity of our workforce by 33% and the overall daily workforce capacity by 33 per cent, either from July 2020 or for a three-month period over the last 12 months,” said Patrick Hutchinson, AMIC CEO.

“Members have been working towards this and finally having clarification, prior to 11.59PM Friday night, 7 August 2020, on what this means to get on with the job.

“We acknowledge and appreciate that there is now a threshold on the workforce impacted, so that sites with 25 workers or less will be exempt from these workforce reduction requirements,” said Mr Hutchinson.

As AMIC has previously outlined, our industry remains a leader in utilisation of PPE, with minimum requirements including face masks; hair nets; snoods; aprons (heavy plastic or disposable); rubber and  plastic gloves; sleeve protectors; dust coats; safety glasses; face shields; goggles and other specialist PPE depending on worker function.

However, at all times, work safety is paramount in our industry therefore AMIC will continue to work with its members, WorkSafe Victoria and the Department of Health and Human Services (DHHS) on where the most appropriate utilisation of PPE will occur, to ensure both safety of community in virus management and safety of workers in the workplace.

Finally, regarding the testing regime, AMIC remain committed to its members’ concerns, surrounding testing result turnaround, availability of tests, alignment with private providers of testing, and proactive asymptomatic testing and provision of results.

AMIC has created and delivered its own guidelines to industry members, we will update those with the information provided and as an industry we continue to stand by these guidelines for our members to meet the requirements as set by the VIC Premier at his press conference today.

“Regarding supply and prices of meat, it is still challenging to forecast,” said Mr Hutchinson.

“What is positive for the community is that the over 800 independent retail butchers across Victoria remain open and any change to that would severely impact the ability of the community to access product, especially within metro Melbourne noting the within 5km from home community restrictions on travel.

“AMIC continues to strenuously endorse independent butchers remaining open during stage 4 lockdown.

“Our members stand ready to meet the key areas set out by the Premier, being reduction of movement within the community of Victoria.

“The time for supporting our industry in a positive manner, from the Premier through to Cabinet and DHHS is now. We remain grateful for the assistance from Ag Victoria.”

Don’t blame us over COVID-19 says AMIC

From as early as January 2020, the Australian Meat Industry Council (AMIC) commenced implementing robust risk management guidelines, to incorporate COVID-19 safety plans and measures, for the industry’s total supply chain and independent retail network.

The meat industry is uniquely positioned as one of the premier industries where food safety and hygiene is part of its core business. Its members operate to very stringent standards including HACCP, Good Manufacturing Practice, and Australian Standards, which are verified by state and federal food safety authorities.

As an essential service, the industry has continued to operate across the supply chain during the coronavirus pandemic knowing that the supply of food is our community’s most basic need and this has been reflected in increased sales of red meat during the pandemic.

AMIC has noted the negative reporting by media agencies recently, particularly in Victoria, and disputes any commentary alleging the meat industry as being a responsible party in the transmission of coronavirus, due to recent cases being brought into processing plants in Victoria.

Australia’s Food Standards agency (FSANZ) and well-respected international agencies including the European Food Safety Authority (EFSA), and World Health Organization (WHO) have publicly stated that there is no evidence to suggest that coronavirus is transmitted in food, and no reported cases from human contact with food.

“This is a public health issue and a community transmitted virus, not a meat industry or food safety issue,” said AMIC CEO, Patrick Hutchinson. “There has been an over-emphasis of cases being linked to the Australian meat industry, yet the virus is being transmitted in the community, not generated from within any particular industry,”

“The Australian meat industry has extremely controlled measures in place and should not be viewed through the same lens as meat industries in other countries.

“The actual percentage of staff that make up the total amount of cases within a “cluster” linked to a meat processing facility is small relative to total community transmissions, in some cases less than 3 per cent, across our red meat and smallgoods members.

“Further, there is a negligible amount reported in our independent retail butcher chain.”

Today, VIC Premier Daniel Andrews said that if people continue to go to work with symptoms, it could shut down industries.

“If we were to continue to see outbreaks, if we were to continue to see people quite obviously attending work when they shouldn’t be, then every option becomes on the table,” he said. “Next steps may well have to include closing a number of these industries if we continue to see people attending work.

“We have to work together to keep anyone who’s got symptoms away from work. Otherwise businesses will have to close.”

AMIC reinforces the VIC Premier’s message for workers to stay away from their workplace if they display symptoms, get tested and follow the isolation instructions.

“This is a people transmitted virus and will be solved by people implementing and abiding by COVID Safe recommendations,” says Hutchinson.

The primary focus of AMIC’s impacted members has been on the health and safety of its workforce, ensuring functional plans are implemented to minimise the risk of spreading the virus among staff. This includes temperature screening, daily sanitation, regular sanitisation, social distancing, and staggered shifts.

“The impacts of any potential closures of processing plants has a flow through effect to our wholesalers and retail network chains, which ultimately impacts our farmers and producers,” said Hutchinson.

“We are an essential service feeding Victorians and Australians through independent retail and supermarket chains, and the global community, daily. We take this very seriously.

“Whilst as industry we continue to remain supportive of our front-line health workers and health department staff working with our members daily, some information has been confusing for Victorians, with changing advice to workers regarding isolation.

“We do not want to see the shut-down of our industry due to changing rules that we have limited to no control over.

“As such, we are working closely with the Department of Health and Human Services (DHHS) and those members that have been impacted to ensure minimal interruption to business operations and communicate a clear set of expectations and response procedures,” he said.

While consumer demand has been higher recently, the independent retail channel sources its product from various processing facilities across Australia and is agile to meet consumer demands.

Awards varied for Work Flexibilities due to COVID-19

A Full Bench of the Fair Work Commission recently varied approximately 99 Awards, including the Meat Industry Award 2010 (the Award). The variation is effective immediately and will remain in operation until 30 June 2020.

The Australian Meat Industry Council (AMIC) has advised members on a variety of options available to them during the Coronavirus pandemic, including the JobKeeper incentive, stand down provision and allowing employees to take accrued leave should a stand down occur.

A brief summary of the variation, known as ‘Additional measures during the COVID0-19 pandemic’ is outlined as follows:

Unpaid pandemic leave:

  • allows employees to take up to two weeks unpaid pandemic leave if required,
  • the employee must give the employer as much notice as possible of the need to take leave, and,
  • if required by the employer provide evidence “that would satisfy a reasonable person” that the leave is necessary,
  • leave taken under this clause does not affect any other leave type in the Award,
  • Leave taken under this clause must commence before 30 June 2020.

Annual leave at half pay:

  • allows an employee to take twice as much annual leave on half pay.
  • any agreement to leave under this clause must be in writing and kept on the employees’ records.
  • any leave taken is recorded as half the amount taken. For example, two weeks leave at half pay is recorded as one week’s leave and deducted fem the employee s annual leave accruals.
  • The approved leave under this clause must commence prior to 30 June 2020

A requirement under these new temporary award provisions are that, nobody may take adverse action against or coerce a person into taking leave.

Trade agreements critical to Australia’s regions and red meat jobs

The Australian red meat industry urged both sides of Government to proceed with ratification of two critical free trade agreements without delay, following today’s release of a Joint Standing Committee on Treaties (JSCOT) report.

The report (#186 tabled 9 October 2019) into the Indonesia-Australia Comprehensive Economic Partnership Agreement (IA-CEPA) and Australia-Hong Kong Free Trade Agreement (A-HK FTA) determined that the IA-CEPA and the A-HK FTA are in Australia’s national interest. The Committee therefore recommended binding treaty action in both cases.

“The Australian industry strongly endorses the JSCOT outcomes for both the IA-CEPA and A-HK FTA,” said Red Meat Advisory Council (RMAC) Chair Don Mackay.

“Indonesia is a vitally important trading partner for the Australian live cattle and beef industry – along with a steady requirement for sheepmeat. Combined, the existing trade was worth over a $1 billion in 2018.

“The benefits of ratifying IA-CEPA and securing more trade certainty with a key export market are unsurpassed – particularly at a time of global trade disruption.”

In addition, the implementation of the A-HK FTA promotes a closer economic relationship between Australia and Hong Kong and will ‘lock in’ Australia’s current duty free access for red meat products.

“The A‑HK FTA will complement the benefits our sector has derived from the China-Australia Free Trade Agreement as well as Australia’s other trade agreements throughout Asia – bilaterally with Japan and South Korea, regionally with ASEAN and via the Trans-Pacific Partnership (TPP-11),” Mackay said.

“In 2018 alone, we exported just over 7,000 tonnes of beef to Hong Kong, worth $96 million, demonstrating the critical importance of diverse markets to returning prosperity back to Australia’s red meat businesses and regions.

“We applaud the efforts of the Australian Government in pursuing trade reform globally and look forward to the ratification of these two agreements in the Parliament, and the subsequent entry into force of both agreements at the earliest possible opportunity.

“Our industry represents in excess of 80,000 businesses and 405,000 jobs, with a large portion of these located in rural and regional Australia.

“For every 10 jobs in our industry, six rely on our trade with the world. Deals like the IA-CEPA are vital for these jobs and vital for our regions, especially Australia’s north.

“Trade agreements such as these are integral to helping ensure the cost competitiveness of the Australian supply chain – at a time of weather related challenges and mounting international competition.”

Project to improve red meat productivity and decrease emissions

A new research project could help red meat producers improve productivity and decrease greenhouse gas emissions by adding custom designed biochar to cattle and sheep rations.

The project aims to define biochar production processes that will  produce fit-for-purpose biochar for inclusion in ruminant feeds and then quantify and validate the effects on animal productivity and emissions.

The project is one of 13 new on-farm research, development and adoption (RD&A) projects to receive Meat & Livestock Australia (MLA) investment of $6.2 million in levy funds in 2018-19. This investment in industry driven R&D is a result of  MLA’s regional consultation process, which enables producers to have input into the direction of RD&A funding most relevant to them.

The biochar research will be led by Dr Rob Kinley, a Livestock Systems Scientist with CSIRO Agriculture and Food, in consultation with Professor Phil Vercoe of the University of Western Australia (UWA).

Biochar is a charcoal that is generally associated with carbon sequestration, adsorption of gases, and soil enrichment.

READ MORE: Research shows huge opportunity for grain-fed beef sales to China

The use of biochar as an ingredient for improved livestock productivity has so far indicated promotion of a more efficient rumen. Kinley said is huge diversity in biochar types, but no biochars have been designed to be fit-for-purpose for ruminant production, which is a primary objective of this project.

“We know that producers are also interested in feeding biochar to cattle and sheep because there is evidence that soil health is improved through distribution of biochar in the soil, with help from dung beetles,” Kinley said.

“We also have some on-farm evidence that liveweight gain is improved in Angus-cross cattle fed biochar, with producers and scientists showing interest in its potential.

“It’s about filling a knowledge gap and ensuring resources are directed towards a supplement specifically designed to enhance production with a co-benefit of decreased methane emissions.”

As part of the research, CSIRO will partner with producer groups across Australia to customise the process and parameters of biochar production to optimal feed supplement techniques and rations that maximise productivity and minimise emissions from livestock systems.

Researchers will use a range of parent materials to generate the biochars, including various woody plants and fodder, with emphasis on industry and agriculture waste streams.

MLA General Manager – Producer Consultation and Adoption, Michael Crowley, said the project was an exciting and important piece of work for the red meat industry’s broader sustainability agenda.

“CSIRO’s biochar research strongly aligns with MLA’s commitment to the CN30 initiative which is Australia’s red meat industry ambition of being carbon neutral by 2030,” he said.

“It is important that efforts to achieve carbon neutrality have the dual objective of improving profitability for red meat producers and this research is a great example of this: it has the potential to boost productivity and profitability in red meat production systems while reducing emissions.”

AMIC welcomes new red meat reform

The Australian Meat Industry Council (AMIC) will engage with members over the coming weeks to discuss the recommendations in the  Red Meat Advisory Council’s (RMAC) White Paper  ‘A better red meat future’.

The White Paper makes a number of recommendations for updating the red meat sector’s memorandum of understanding. Its goal is to provide a clearly defined strategy to strengthen the value and reputation of Australia’s 82,500 red meat businesses.

AMIC CEO, Patrick Hutchinson, said members have taken an active interest in the development of the White Paper.

“We commend the Independent Taskforce for its work in gathering and assessing the wide feedback from across the sector. We support the broad aims of this exercise, which is about  promoting a stronger, more competitive and streamlined industry,” he said.

“We’ll be going out to members in the coming weeks and months to gauge their response to the White Paper and in due course will share our thoughts on the best way forward to ensure greater returns for our members, while driving us all towards a high performing domestic and internationally recognised red meat industry.”

AMIC has been involved in the consultation process around the White Paper development, to ensure its diverse membership, which includes processors, wholesalers, smallgoods and butchers, has been fairly represented.

Red meat industry calls for cuts to red tape costs

The Australian Meat Industry Council of Australia (AMIC) is set to formally present the red meat industry’s Cost to Operate Report to key political parties from this week, as calls are made for urgently-needed bipartisan solutions to cut the cost burden of excessive red tape and energy costs.  According to the report, Australian meat producers have the highest operating costs in the world, making it impossible to be continually competitive on an international basis.

Importantly, the Report has had a significant galvanising effect across the red meat industry supply chain, with processors, wholesalers, smallgoods manufacturers, and independent butchers coming together to determine a range of strategies that aim to ensure they do not suffer the same fate as most of Australia’s other major manufacturing industries.

The red meat ‘farm-gate to plate’ supply chain is the largest rural and regional employer providing more than 150,000 full- and part-time jobs.  It’s also the country’s largest agricultural exporter with more than 70% of red meat and co-products produced sold overseas in 124 countries, and contributes more than $21 billion in value added to the economy.

The Cost to Operate Report shows that cost reduction is the only way the industry can compete with the main competing global red-meat-producing markets, including the USA, Argentina, Brazil and New Zealand, which are working hard to increase access to Australia’s key overseas markets at a time when Australia’s product has been impacted by catastrophic droughts and floods.

The average cost per head, excluding livestock purchases, incurred in processing beef in Australia are 24 per cent higher than in the USA, 50 per cent higher than Brazil and 75% than Argentina.  Of these costs, it is estimated in Australia that 54 per cent are due to some form of government regulation.  This is more than twice that of the USA and Argentina and more than three times that of Brazil.  In addition, Australia’s regulated costs for beef and sheep are 46 per cent and 37 per cent higher respectively than those of its closest neighbour, New Zealand.

Australian processors also face unreasonably high energy costs and are paying 104% more than North American processors for utilities, 53% more than the Argentinians, 20% more than New Zealanders and 0.3% more than the Brazilians.

Furthermore, in Australia, labour-related costs comprise over 58% of total operating costs.  This figure is considerably less than 50% in the other countries examined in the Report.

Patrick Hutchinson, AMIC’s CEO, said, “Australian processors, and the wider red meat supply chain, are battling unsustainable cost pressures while continuing to remain competitive internationally but, according to the report, they’re fighting a losing battle, particularly as one of the biggest costs they face is as a result of excessive government red tape.”

Australia’s government-regulated inspection and certification costs are 3.4 times higher than the USA and 4.5 times higher than Argentina.  In Brazil these costs are fully-funded by the federal government and are not passed on to processors.

The Cost to Operate Report found that one of the key contributing expenses is offshore inspections fees, adding around $110 million in costs each year. These inspection fees are not exclusive to Australian businesses, the difference is in government response in other countries. Both the US and Brazilian governments offer support to their processors, covering around 95% of these fees, while Australian processors are currently fending for themselves.

“We are asking for relief in export certification charges, which is one of the largest cost contributors to why Australian red meat is becoming uncompetitive in the global market,” explained Mr Hutchinson.

“Simply put, the red meat industry is dependent on global trade for its viability.  Streamlining the major federal and state regulatory and red-tape burden would be a good first step and will allow the industry to compete on a level footing with other red meat producing countries,” he said.

“As appreciation, particularly from Asia, increases for Australia’s high-quality premium meat and renowned ‘clean and green’ status, our industry is saddled with the considerable burden of being the highest-cost red meat processing nation in the world. Cost reduction, as highlighted in the CTO Report, is our best course of action to increase our industry’s ability to not be priced out of the global market, remain viable and ensure sustainable prices for livestock for our Australian farmers.

“With regard to excessive energy costs, the unfortunate policy paralysis is resulting in increased cost flows across the full supply chain as the industry is one of the biggest users of energy due to its refrigeration requirements, as an example. Energy costs are realised throughout the process of meat production.

“We all want farmers to thrive, but the reality is that a weakened supply chain that is hindered from competing globally will be the next and long-lasting crisis for farmers if urgent action isn’t taken,” said Mr Hutchinson.

Chop unreasonable red tape costs to level international playing field

The Australian Meat Industry Council of Australia (AMIC) is set to formally present the red meat industry’s Cost to Operate Report to key political parties from this week, as calls are made for urgently-needed bipartisan solutions to cut the cost burden of excessive red tape and energy costs.  According to the report, Australian meat producers have the highest operating costs in the world, making it impossible to be continually competitive on an international basis.

Importantly, the Report has had a significant galvanising effect across the red meat industry supply chain, with processors, wholesalers, smallgoods manufacturers, and independent butchers coming together to determine a range of strategies that aim to ensure they do not suffer the same fate as most of Australia’s other major manufacturing industries.

The red meat ‘farm-gate to plate’ supply chain is the largest rural and regional employer providing more than 150,000 full- and part-time jobs.  It’s also the country’s largest agricultural exporter with more than 70 per cent of red meat and co-products produced sold overseas in 124 countries, and contributes more than $21 billion in value added to the economy.

The Cost to Operate Report shows that cost reduction is the only way the industry can compete with the main competing global red-meat-producing markets, including the USA, Argentina, Brazil and New Zealand, which are working hard to increase access to Australia’s key overseas markets at a time when Australia’s product has been impacted by catastrophic droughts and floods.

The average cost per head, excluding livestock purchases, incurred in processing beef in Australia are 24 per cent higher than in the USA, 50 per cent higher than Brazil and 75% than Argentina.  Of these costs, it is estimated in Australia that 54 per cent are due to some form of government regulation.  This is more than twice that of the USA and Argentina and more than three times that of Brazil.  In addition, Australia’s regulated costs for beef and sheep are 46% and 37% higher respectively than those of its closest neighbour, New Zealand.

Australian processors also face unreasonably high energy costs and are paying 104 per cent more than North American processors for utilities, 53 per cent more than the Argentinians, 20 per cent more than New Zealanders and 0.3 per cent more than the Brazilians.

Furthermore, in Australia, labour-related costs comprise over 58 per cent of total operating costs. This figure is considerably less than 50 per cent in the other countries examined in the Report.

Patrick Hutchinson, AMIC’s CEO, said, “Australian processors, and the wider red meat supply chain, are battling unsustainable cost pressures while continuing to remain competitive internationally but, according to the report, they’re fighting a losing battle, particularly as one of the biggest costs they face is as a result of excessive government red tape.”

Australia’s government-regulated inspection and certification costs are 3.4 times higher than the USA and 4.5 times higher than Argentina.  In Brazil these costs are fully-funded by the federal government and are not passed on to processors.

The Cost to Operate Report found that one of the key contributing expenses is offshore inspections fees, adding around $110 million in costs each year. These inspection fees are not exclusive to Australian businesses, the difference is in government response in other countries. Both the US and Brazilian governments offer support to their processors, covering around 95 per cent of these fees, while Australian processors are currently fending for themselves.

“We are asking for relief in export certification charges, which is one of the largest cost contributors to why Australian red meat is becoming uncompetitive in the global market,” explained Hutchinson.

“Simply put, the red meat industry is dependent on global trade for its viability.  Streamlining the major federal and state regulatory and red-tape burden would be a good first step and will allow the industry to compete on a level footing with other red meat producing countries,” he said.

“As appreciation, particularly from Asia, increases for Australia’s high-quality premium meat and renowned ‘clean and green’ status, our industry is saddled with the considerable burden of being the highest-cost red meat processing nation in the world. Cost reduction, as highlighted in the CTO Report, is our best course of action to increase our industry’s ability to not be priced out of the global market, remain viable and ensure sustainable prices for livestock for our Australian farmers.

“With regard to excessive energy costs, the unfortunate policy paralysis is resulting in increased cost flows across the full supply chain as the industry is one of the biggest users of energy due to its refrigeration requirements, as an example. Energy costs are realised throughout the process of meat production.

“We all want farmers to thrive, but the reality is that a weakened supply chain that is hindered from competing globally will be the next and long-lasting crisis for farmers if urgent action isn’t taken,” said Hutchinson.