Australia’s top 100 food and beverage companies

IBISWorld has released its annual list of the Top 100 food and beverage companies in Australia. The list offers detailed insight into the largest companies in two of the nation’s most diverse subdivisions.

 
The largest 100 food and beverage companies in Australia generate in excess of $AUD100 billion in revenue (up from over $AUD96 billion in 2014-15) and employ more than 130,000 Australians. 
 
IBISWorld has identified key industry trends underpinning major company movements in 2015-16. 

These include:
·         Strong growth in food processing industries – particularly meat processing – driven by free trade agreements and increasing global demand for Australian produce.

·         Milk production in Australia has benefited from joint ventures and expansion of airfreighted fresh milk exports to growing Asian markets, particularly China.

·         The beer manufacturing industry has struggled as consumer tastes have shifted towards craft beer, and industry revenue is set to decline as alcohol consumption, particularly of traditional beer brands, continues to fall.

·         The wine production industry is moving towards recovery, following a wine glut that negatively affected the industry for the better part of the past decade.

The list also highlights:
·         Fonterra: remained number one on the list of top food and beverage companies by revenue generated.
·         Lion Nathan: remained number two on the list.
·         Coca-Cola Amatil: remained number three on the list.
·         Parmalat: jumped from number 27 last year to reach number 19 this year.
·         Green’s Foods: made it onto the top 100 list for the first time at number 87.
·         a2 Milk: made it onto the top 100 list for the first time at number 100.
·         Goodman Fielder: slipped 3 places to settle at number 11.
·         Mars: slipped 3 places to settle at number 22.
·         Bindaree Beef: moved from number 51 last year to reach 35 this year.
 
“The two newcomers to the list are Green’s Foods and a2 Milk. Green’s Foods has entered the list at rank 87, while a2 has entered at 100. Green’s Foods posted a surge in revenue of 72.6% over the year through December 2014. This was the result of the company’s acquisitions of Goodman Fielder’s and Waterwheel’s biscuit businesses in 2013. a2 Milk posted revenue growth of 40.2% over the year through June 2015, on the back of fresh milk exports to China and substantial sales growth in a2 Platinum Infant Formula across Australia and New Zealand,” said IBISWorld senior industry analyst Spencer Little.
 
“After purchasing the remaining 50% interest in the a2 Milk Company Limited joint venture and converting it to a fully owned subsidiary, a2 Milk began exporting fresh milk to China in August 2014. Sales of the company’s infant formula skyrocketed in 2014-15,” concluded Little.
 

Food Processing Pen

The Elephant brand stick pens are designed with or without a pocket clip and offer the option to have a lanyard attachment point. 

The grip has a triangular section to provide a secure hold for gloved hands in wet working areas and the whole body has textured finish. The new Elephant Pen can be ‘seen and rejected’ by both metal detection and X-ray inspection systems used in the food industry. 

The lanyard attachment will take a safety chain or the clip on a fabric lanyard that includes a breakaway device for safe use in a working machine area. The pen is rounded for easy cleaning and minimal soiling and entrapment. 

 

Freedom Foods to acquire Ringwood Mill for $5.9 mill

Freedom Foods has entered into an agreement with the Ringwood Group of Companies to acquire the business and assets of the Ringwood Mill for $5.9 million.

Earlier this month, Freedom Foods announced that as part of the Australian Fresh Milk Holdings, it would be jointly acquiring Australia’s largest single-site dairy operations, Moxey Farms.

But it doesn’t stop there, as the a2 milk company revealed it was one of two parties in a bid for the a2 Milk Company, a deal which has yet to be finalised. In early June, Freedom Foods also coughed up $16.6 million for 66,000 square metres of land at Ingleburn for a proposed new integrated Aseptic (UHT) production and logistics facility.

Ringwood Mill, based at Darlington Point in the Riverina district of New South Wales, operates a grain processing facility for the supply of milled flours and popping corn. The facility is a significant processor of popping corn in Australia and processes gluten free grains. It is approximately 32 kilometres from Freedom Foods’ allergen free cereal and cereal snacks facility at Stanbridge near Leeton.

The acquisition of the Ringwood Mill will enable Freedom Foods to expand its milling operations for internal use and external third party customers through increased capabilities and capacity, access to cost efficiencies and the ability to consider expansion into processing of other key grains. Freedom Foods will relocate its existing milling operations to the Ringwood Mill, providing for increased finished goods warehousing capabilities at its current operations.

Under the terms of the acquisition, Freedom Food will acquire assets located at the site including 7.5 hectares of land, several modern large and medium sized grain silos, flour processing plants, other machinery and equipment and buildings including an export container facility. Freedom Foods will also acquire raw materials including popping corn and maize. 

 

McCain Foods to invest $10 mill in Smithton plant

McCain Foods Australia/New Zealand will spend up to $10 million dollars over the next two years upgrading onsite storage facilities and building a new packing line at the Smithton plant in Circular Head, Northern Tasmania.

McCain Foods will spend an estimated $7.9 million on the on-site storage over two years and $1.6 million on the new packing line.

The improved storage facility will hold up to 55,000 tonnes of potato for processing.

McCain Foods Australia/New Zealand Agriculture Director John Jackson said the investment in upgrading storage and a new packing line will increase efficiencies and make the plant more sustainable.

“While this added investment will increase the plant’s capability and efficiencies, we still have a number of challenges before us in maintaining the competitiveness of the plant to ensure its long term survival,” he said.

“One of the challenges, in such a competitive market, is maintaining and increasing efficiencies to drive cost-reduction. Even in Northern Tasmania, we have to realize that we are competing in a global commodities market.

“In addition, rising local water and energy costs impact on the plant’s cost base reducing its overall profitability against global competitors.”

The Smithton plant processes potatoes for French Fries and potato products for the local and interstate markets.

 

Huon Aquaculture opens $12 mill processing plant

Huon Aquaculture has opened a new $12 million Smokehouse and Product Innovation Centre in Parramatta Creek.

The facility is comprised of a 2,500m2 value-added salmon processing facility and a 750m2 administration facility. It is expected to deliver more than one million dollars in cost savings for the company in its first year of operation under one site.

The new facility involves a revamp and extension of Huon’s existing Parramatta Creek operation, now twice as large as its original footprint.

Huon Aquaculture Managing Director Peter Bender said: “Our new facility will enable us to increase our production capacity and efficiency, while reducing our environmental footprint.

“We produce around 17,000 tonnes of fresh salmon each year, with our new facility part of our four-year $160 million controlled growth strategy.

“This world-class site will incorporate whole fish, fresh fish, and value-added cold and hot smoked production, successfully bringing together our full range of seafood processing at a single location.”

The project includes:

  • A suspended walkway across existing and new processing facilities provides access to staff entry areas, as well as viewing facilities for customers and visitors.
  • The new 750m² administration facility includes meeting rooms, a boardroom, laboratory and product development, and extended car-parking facilities. The dining room and commercial kitchen are complimented by staff breakout and barbeque areas for 100 employees.
  • The existing fresh salmon processing facility, completed in stage one, received a reconfiguration of process areas and upgrade works to drainage and floors with a new epoxy finish.
  • LED lighting has been incorporated throughout the new facility providing an improved environment for the staff and saving on energy consumption and maintenance.

 

Senate committee recommends sugar Code of Conduct

A federal parliamentary inquiry into the marketing of Australian sugar has made only one recommendation.

The single recommendation reads “the committee recommends the development and implementation of a mandatory sugar industry Code of Conduct, acknowledging that, provided appropriate stakeholder consultation is undertaken, the work of the Sugar Marketing Code of Conduct Taskforce may provide a foundation upon which a Code of Conduct may be established.”

Dominic Nolan, CEO of the The Australian Sugar Milling Council (ASMC) said the report was largely expected.

“There were clear indications throughout the public hearings conducted by the Committee that the Report from the Inquiry was going to recommend a mandatory Code of Conduct, and that is what we have,” Nolan said.

“The report does not make a case for government intervention, and it does not adequately consider what the impact of such regulation will be for the sugar industry. There is still no clear statement of what the problem is that this recommended regulatory approach is supposed to address.”

“There are no surprises in the Inquiry’s recommendation, however it doesn’t take away from the real imperative: the only viable solution to current challenges around sugar marketing arrangements is through a commercially negotiated outcome between mill companies and their growers,” Nolan said.

 

Gluten free WeetBix: the need, the factory and the launch

Catering for the gluten free involves a whole lot of research, investment, and for Sanitarium, crawling through air ducts with a toothbrush.

Last year, in response to changing breakfast habits and the rise of gluten free, Sanutarium launched Gluten Free WeetBix; a launch which would rank as one of the most successful product launches in Sanitarium’s history.

“We did some research,” says Alex Garas, Senior Brand Manager for WeetBix Australia at the 2015 Grains & Legumes Consumption Symposium. “We know that people who are on a gluten free diet, particularly those that are eating breakfast cereals, feel like they are compromising. They’re compromising on taste, because with exceptions, some [cereals] don’t taste as good. They have less variety because there’s less to choose from, possibly [less] convenience and they’re also compromising on cost because they’re paying more per serve than they would be if they were eating their gluten equivalents.

“Around one per cent [of Australians] are diagnosed with coeliac, around six per cent have a sensitivity to gluten and almost 25 per cent of people are actively looking to reduce the gluten in their diet.”

Gluten free: It’s here to stay

Sanitarium’s research revealed that a lot of consumers choosing to reduce the gluten in their diet (as opposed to being coeliac), saw the idea of a gluten free WeetBix coming to the market as a “normalising” experience. They appreciated that a big brand, would release a gluten free product and actually cater to these people.

“It was seen as actually quite an emotional thing,” Garas says.

“What was baffling for me and the turning point for me to go ‘this is not a fad’ was when…we did some research in Parramatta and we had tradies turning up, truck drivers and mechanics going ‘yeah my wife’s got me on a gluten free diet, I don’t eat gluten’ and wearing it as a badge of pride…it was an astounding effect and when you hear mechanics and tradies going ‘this is what I’m doing with my life,’ it’s no longer a fad or a trend, it’s here to stay.”

Developing gluten free WeetBix

Sanitarium then set about developing what Gluten Free WeetBix might be.

“We tested a range of gluten free grains and we ended up using Sorghum, and tried to make it as nutritionally similar as we could to WeetBix, certainly in terms of the fat, salt, sugar levels. We didn’t want to have that compromise that some gluten free consumers felt,” Garas says.

After a positive response from sensory research (taste testing), Sanitarium was faced with four options: build a new factory to only make gluten-free WeetBix, dedicate one of their existing factories to gluten free WeetBix, do a reduced gluten “half way house, where we put a line in our existing wheat factory and put in a Perspex wall and hope the wheat didn’t get over the wall”, or not do it at all.

“We didn’t think we could build a new factory because we didn’t think we could pay off our capitalist manager. We didn’t think that we would do a sort of half-assed attempt of putting a lining or a wall there and then it wouldn’t be gluten free, it would be gluten reduced and it would compromise the offer…we don’t want to not do it, so we took our factory over in Carmel and we dedicated that to now making gluten free WeetBix.

“The factory in Carmel has made WeetBix for the best part of four decades. You can how the wheat was embedded in the DNA of that building. So we had people, and I’m not exaggerating, crawling through air ducts, cleaning with toothbrushes, we had people burning the wheat off nuts and bolts on the floor, to make that such a sterile environment. There was no gluten there anywhere.

“We then sourced Sorghum providers. WeetBix is all Australian, we didn’t want to compromise on country of origin with gluten-free WeetBix, so it had to be Sorghum sourced from Australia, but we wanted to source it from a farmer in Australia, who didn’t also grow wheat, because there couldn’t be wheat in the silos, there couldn’t be wheat in the trucks, so we founded a partnership with a family grower in Northern NSW that grows Sorghum,” Garas says.

The launch

When launching Gluten Free WeetBix, it was vital to the company that it did not denigrate wheat.

“Our advertising campaign was ‘welcome back to WeetBix’ and it was very important that we couldn’t take a small part of our portfolio and say ‘that evil wheat, that evil gluten that’s making everyone fat, is our alternative,’ because that’s detrimental to everyone and not what we believe at all, we are simply offering people an alternative,” Garas says.

Developing and launching Gluten Free WeetBix involved millions of dollars investment and Garas says it was “one of the biggest bets we’ve made probably in a decades.”

But, luckily for Sanitarium, it paid off.

“To date, gluten free WeetBix ranks as one of the most successful product launches in Sanitarium’s history, something that we are incredibly proud of,” Garas says.

It started with a single Facebook post with the caption “it’s here” and a picture of the product. That reached 700,000 people.

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Gluten Free Weet-Bix is here! Tag a friend who misses Weet-Bix. More info: https://bit.ly/GFWeetBix #mynewgf

Posted by Weet-Bix on Tuesday, July 22, 2014

“We had people phoning us saying ‘is this an April Fool’s joke?’ we had people saying ‘I don’t understand, how can WeetBix be wheat-free?’

“We thought about changing the name, but Sorghum-Bix didn’t quite sound as delicious. About one in ten people had a problem with it being wheat-free WeetBix, the other 9 went ‘but it’s not ‘wheat’, it’s a brand, we can get over it,’” Garas says.

“Our launch campaign had reached around two and a half to three million people before we’d really spent a dollar on advertising. We had a TV ad that went above the line when we were national…but by that point, we’d reached almost three million people and that was due to the passion of which the gluten free shoppers or consumers felt that they were being looked after by a big brand. It was the idea that a big brand would no longer make them go to the ‘there’s something wrong with you’ aisle, but actually mainstream it and say ‘this is for those of you who want to reduce your gluten.’”

In the first 3-4 months, Gluten Free WeetBix had a repurchase rate of 50 per cent, meaning half the people were coming back and buying another box.

“This isn’t about fuelling the anti-wheat brigade and certainly not helping out the likes of Pete Evans, but this is about saying that every Aussie deserves to be raised a WeetBix kid,” Garas says.

 

Baiada Group busted by Fair Work Ombudsman

The Fair Work Ombudsman today released the findings of its Inquiry into allegations levelled at the Baiada Group over employment practices at its three poultry processing sites at Beresfield, Hanwood and Tamworth in NSW.

The Inquiry found exploitation of a labour pool comprised predominantly of overseas workers in Australia on the 417 working holiday visa. Exploitation included significant underpayments, extremely long hours of work, high rents for overcrowded and unsafe worker accommodation, discrimination and misclassification of employees as contractors.

It also found non-compliance with a range of Commonwealth workplace laws and very poor, or no governance arrangements, by all parties in the various labour supply chains,

An Inquiry was launched in November, 2013, following complaints from plant workers that they were being underpaid, forced to work extremely long hours and required to pay high rents for overcrowded and unsafe employee accommodation.

Baiada is the largest Australian-owned poultry processing company and has a market share of more than 20 per cent. It produces the Lilydale Select and Steggles chicken brands for customers including Coles, Woolworths, IGA, Aldi, McDonald’s, KFC, Pizza Hut, Red Rooster, Nando’s and Subway.

Baiada refused permission for Fair Work inspectors working on this Inquiry to access the factory floor at its worksites, denying them an opportunity to observe work practices, as well as talk to employees about conditions, policies and procedures.

Baiada also failed to provide the Inquiry with any “significant or meaningful” documentation on the nature and terms of its labour contract arrangements.

However, the Inquiry found that employees working at Baiada sites are not being paid their lawful entitlements.

The company had verbal agreements with an extensive list of labour-hire operators used to source most of its workers, largely 417 working holiday visa-holders from Taiwan and Hong Kong.

Baiada’s labour-hire contractors were unwilling to engage with the Inquiry and produced inadequate, inaccurate and/or fabricated records to Inspectors.

Based on limited material provided, hundreds of thousands of dollars could not be accounted for as money moved through various hands down the company’s labour supply chain.

As at October, 2013, information provided by Baiada indicated that it had verbal agreements to source labour with six principal contractors; B & E Poultry Holdings Pty Ltd, Mushland Pty Ltd, JL Poultry Pty Ltd, VNJ Foods Pty Ltd, Evergreenlee Pty Ltd and Pham Poultry (AUS) Pty Ltd.

Baiada paid these principal contractors per kilogram of poultry processed, rather than hours worked – in other words, irrespective of night shifts, weekends or public holidays.

The six principal contractors in turn sub-contracted to at least seven other second-tier entities, some of whom further sub-contracted down a further two or three tiers, involving up to 34 separate entities in total.

There were no written agreements and the model relied on high levels of trust.

During the course of the Inquiry, four of the six principal contractors and 17 other sub-contractors ceased trading.

One day before the director of two companies was due to meet Fair Work inspectors, he sent an email advising that his two entities were being liquidated. The matter is being referred to the Australian Securities and Investment Commission (ASIC).

Over the course of the Baiada Inquiry, Fair Work inspectors made numerous site visits to registered addresses of the various contractors, as well as attempting to make contact by email, fax and phone using both bilingual staff and interpreters.

The Inquiry found that a large amount of work was performed “off the books”, as amounts paid to contractors did not correspond with the number of workers and wages allegedly paid to them.

The overseas workers were primarily recruited by sub-contractors through Chinese newspapers, Facebook or Taiwanese backpacker websites.

The advertisements frequently asked applicants to respond with details of their nationality, height and weight and were potentially discriminatory.

First-hand accounts from some of the workers at the plants were obtained by bilingual Fair Work inspectors who travelled to Beresfield and Hanwood, and community opinions and experiences were obtained through a series of co-ordinated “listening posts”.

Workers at Beresfield reported that they would not get any work unless they rented accommodation from the labour hire contractor, and rent was allegedly unlawfully deducted from their pay.

One property, found to be sleeping 21 people, was purchased in March, 2012, for $370,000 as a rental accommodation. Based on 20 people paying $100 a week each, it has a potential rental income of over $100,000 a year.

Most of the workers at the Hanwood site were managed by Choy Pty Ltd, which de-registered during the course of the Inquiry.

Choy’s director, Sokhan Sin, is now engaged by other contractors to manage workers at the plant, including overseas workers.

Investigations continue into allegations that Mr Sin directs employees to work very long hours, such as 5.30am to 11pm.

The Inquiry’s findings on each of Baiada’s six principal labour-hire contractors:

B&E Poultry Holdings Pty Ltd

In February this year, two Taiwanese 417 working holiday visa-holders contacted the Fair Work Ombudsman alleging they had worked up to 17 hours a day for three days at Baiada’s Beresfield plant for no wages.

At the time, the minimum wage in Taiwan was equivalent to $A4.95 an hour compared to the Australian national minimum wage of $16.87, plus penalties where applicable.

When Fair Work inspectors contacted B&E Poultry – the principal contractor named on their factory ID card – they were told the workers were engaged by a supervisor contracting to one of its sub-contractors in a personal capacity, and were unable to provide any details about the employer.

However, B&E agreed to resolve the matter by paying the workers at the Award rate.

B&E Poultry did not directly engage any employees at the three Baiada sites – but does employ staff at its own processing factories at Ormeau, in Queensland and Blacktown, in NSW.

Last year, after the Fair Work Ombudsman had received requests for assistance from B&E employees resulting in back-payments of more than $100,000, the Agency required the company to enter into an Enforceable Undertaking to ensure its ongoing compliance with federal workplace laws.

Mushland Pty Ltd

The company failed to disclose information specifically requested by the Inquiry and subsequently the phones of both the company director and its accountant were disconnected.

Baiada was unable to provide any further contact details for Fair Work inspectors.

However, analysis of the limited information which was provided, including invoices and pay records, shows that Baiada paid Mushland $255,415.07 for the month of October, 2013.

Mushland in turn paid $52,460.85 in wages to 18 employees for the same period, leaving a total of $202,954.22 unaccounted for – even though 11 of the workers had been underpaid more than $3300.

Mushland de-registered in July, 2014, and workers were reluctant to act as witnesses for the Fair Work Ombudsman.

JL Poultry Pty Ltd

JL Poultry refused to provide the Inquiry with an accurate contact address.

Fair Work inspectors made two site visits to the registered address, only to be told the director was not known and was not located there.

Written correspondence could only be directed to JL Poultry after a Notice to Produce was served on its financial institution, which provided further contact details.

It took the company seven months to provide Fair Work inspectors with records.

The records revealed that in over one two-week period, Baiada had paid JL Poultry $139,080.37.

However, JL Poultry had only paid wages to nine employees totalling $8746.80, leaving a margin of $130,333.57 unaccounted for.

The Fair Work Ombudsman issued JL Poultry with an on-the-spot fine and Letter of Caution in relation to record-keeping breaches, but the company was de-registered in December last year.

JL Poultry advised that its contract with Baiada had been cancelled.

VNJ Foods Pty Ltd

The Inquiry identified that VNJ Foods Pty Ltd directly engaged only one employee.

Records obtained by Fair Work inspectors show that VNJ made cash payments of up to $150,000 a week to a sub-contractor, Clearview LG Pty Ltd.

Despite repeated site visits, telephone calls and email contact, Clearview failed to provide any records or engage with the Inquiry.

VNJ Foods entered into voluntary liquidation during the Inquiry.

Evergreenlee Pty Ltd

Evergreenlee did not engage any employees directly.

Rather, it sub-contracted to two other companies with one common director – CCKY Pty Ltd and WL Jian Pty Ltd, which engaged 19 and 33 employees respectively.

CCKY ceased operating in June last year.

The Inquiry found WL Jian Pty Ltd failed to keep time and wage records as required by federal workplace laws and issued the company with two on-the-spot fines and a Letter of Caution.

Pham Poultry (AUS) Pty Ltd

The Fair Work Ombudsman ran a separate, parallel inquiry into Pham Poultry after receiving requests for help from more than a dozen employees at Beresfield.

Pham Poultry sub-contracted to four other companies, including FoxInt Pty Ltd, whose director Quoc Hung Pham, was also a director of the principal contractor.

Despite Baiada paying Pham Poultry $1.078 million for the month of October, 2013, FoxInt was paying its workers as little as $11.50 an hour for shifts up to 19 hours a day.

Up to 30 workers were housed in a six-bedroom house with only two bathrooms for which they were required to pay $100 a week.

The Fair Work Ombudsman could not locate Quoc Hung Pham, but the second director of Pham Poultry, Binh Hai Nguyen, agreed to repay 10 workers a total of $20,250 to partially rectify the underpayments.

In response to the ABC’s Lateline report in October, 2013, Baiada advised the Fair Work Ombudsman that it had asked Pham Poultry if workers in the supply chain were being paid correctly, and had received the following information:

  • A letter from Pham Poultry’s accountant stating that the company was “compliant with the Poultry Processing Award”, and
  • An unsigned letter from Pham Poultry on company letterhead, also stating that it was compliant with the Modern Award.

Pay-slips provided by Pham Poultry show that for one week, it paid 12 employees (including the company director) wages totalling $6828.83.

However, the $6828.83 payment contrasts with a total of $196,307.01 paid to Pham Poultry that week by Bartter Enterprises Pty Ltd.

Baiada advised the Fair Work Ombudsman that based on the information above, it was “satisfied” that Pham Poultry was compliant with Commonwealth workplace laws.

The Inquiry does not agree and believes Baiada has failed to implement adequate governance arrangements to monitor its sub-contractors.

NTD Poultry Pty Ltd was named as a principal contractor for Baiada in December, 2013, replacing Pham Poultry.

However, a three-tier supply model remained in place, and the final labour provider continued to be FoxInt Pty Ltd, whose director Quoc Hung Pham was also a director of Pham Poultry and who could not be located by Fair Work inspectors.

The Inquiry received advice that FoxInt employees continued to be underpaid at rates as low as $11.50 an hour, but a reluctance by employees to act as witnesses prevented the Agency from pursuing any enforcement action.

Below is further example of the difficulty Fair Work inspectors encountered with sub-contractors during the course of their Inquiry:

DMY Trading Pty Ltd

DMY Trading and Yu Lin Trading Pty Ltd, operated by husband-and-wife directors, had six sub-contractors supplying workers to Baiada’s Hanwood site.

Based on records provided by DMY Trading, Fair Work inspectors attempted to serve a Notice to produce documents on one sub-contractor.

When they arrived at the address provided, they found an automotive workshop. The business had been there for 25 years and the owner had never heard of the labour-hire contractor.

Similarly, when Fair Work inspectors sought to contact two other sub-contractors, the addresses provided led them to clothing manufacturers who had never been involved in the poultry processing industry.

As a result of its Inquiry, the Fair Work Ombudsman recommends Baiada:

  • Ensures its sub-contractors identify the true employer and display the employer’s name on factory ID cards,
  • Introduce an electronic time-keeping system to properly record the start and finishing times of all employees,
  • Set up a formal complaint and dispute resolution process, including the appointment of a Mandarin-speaking human resources representative,
  • Commission an independent, external specialist to review its labour-recruitment practices,
  • Implement protocols and policies to improve governance arrangements to ensure workers at its sites are being paid correctly for all hours worked, and
  • Prepare industry and language specific induction materials for all workers.

For its part, the Fair Work Ombudsman will continue to work closely and collaboratively with other regulatory agencies and groups to:

  • Use Section 550 of the Fair Work Act and its accessorial liability provisions to ensure parties do not turn a “blind eye” to minimum employee entitlements, and hold to account those we find who are involved in contraventions of Commonwealth workplace laws,
  • Investigate labour supply chain practices, such as sham contracting, which deprive vulnerable employees of basic rights and protections, like penalties, overtime, allowances or leave; and pursue those responsible, 
  • Initiate enforcement action against parties, including any accounting and legal professionals found to be assisting businesses to provide false and/or misleading records to Fair Work inspectors,
  • Engage with major buyers of processed chicken products, such as Coles, Woolworths, KFC, Aldi and others, to raise awareness of the importance of compliant and ethical supply chains and, where appropriate, seek partnership agreements to promote compliance,
  • Assist Baiada to implement the recommendations of this Inquiry,
  • Develop a database, accessible by industry, to record all details and compliance history for contractors in the poultry processing industry. If the pilot is successful, the database could be expanded to include contractor information for other industries, such as the meat, horticulture and cleaning industries, 
  • Provide ongoing reports about the findings of investigations into non-compliance with workplace laws in other supply chains to assist other federal and state agencies, lead businesses and customers to understand the industries and to help promote ethical, moral and socially responsible practices,
  • Release this Report. There has been significant public discussion around the labour supply chain in this industry and there is public interest in the findings of this Inquiry. Baiada customers should have this information to make informed choices. It is also hoped the public release of this Report will give confidence to employees previously too frightened to speak to the Fair Work Ombudsman to now come forward with concerns about potential breaches of workplace law.
  • Inform the activity of Taskforce Cadena and the Phoenix Taskforce.

The Fair Work Ombudsman considers that the information it has obtained to date warrants further investigation into the Baiada Group and its contractors.

Ongoing inquiries will focus on accessories to contraventions, sham contracting, and provision of false and/or misleading records to Fair Work inspectors.

The Inquiry noted that when labour hire contractors were asked to demonstrate to Baiada that they were compliant with federal workplace laws, only “minimal evidence” was supplied, which the company appeared to accept at face value.

“Employees working at the Baiada Group’s sites are not being paid their lawful entitlements,” the Inquiry found.

“There is also a range of other conduct which may contravene the Fair Work Act under way at Baiada sites.

“The Fair Work Ombudsman encountered significant barriers to pursuing further inquiries or taking enforcement action in relation to a number of contractors who directly engaged workers, because they did not co-operate, entered into voluntary liquidation or were de-registered.

“In a large number of instances where Fair Work inspectors attempted (and persisted in attempting) to engage with contractors, they ceased operations and were quickly replaced with new ‘price takers’ – resulting in suppliers of labour forced into accepting market prices with no powers to negotiate a higher price.

“It is important to note the actual work and subsequent non-compliance with workplace laws is taking place on premises owned and operated by Baiada. It is therefore the chief beneficiary of work carried out by this labour force.

“Baiada has the ability to take steps to ensure that workplace laws are complied with on its sites.

“There has been extensive media coverage and public debate regarding underpayment practices occurring at Baiada.

“The Fair Work Ombudsman has a history of investigations at worksites where these issues have been raised with Baiada representatives.

“The findings of this Inquiry place Baiada and the head contractors on notice and therefore aware workplace laws are not being complied with and that correct minimum entitlements may not have been and may not be being met.”

The Fair Work Ombudsman’s ongoing inquiries and use of a range of specialised regulatory powers will continue to target practices that are found to be unlawful in supply chain arrangements in the poultry processing industry.

The Fair Work Ombudsman has asked Baiada to publicly declare that it has an ethical, moral and social responsibility to join with the Fair Work Ombudsman to stamp out exploitation of vulnerable workers at its work sites, and extended an invitation to Baiada to join with them in a compliance partnership.

 

Freedom Foods Group acquires Ingleburn site

Freedom Foods has acquired land for a proposed new integrated Aseptic (UHT) production and logistics facility in south west Sydney.

The company has acquired approximately 66,000 sq. metres of land at Ingleburn for $16.6 million (excluding stamp duty).

The new facility will significantly expand capacity and improve on efficiency, when compared to current operations.

The company has been granted local council approval for the proposed development, with construction on a first stage warehouse facility expected to commence in July 2015, with construction of the adjacent processing and filling facility commencing later in the first half of FY 2016.

The acquisition was funded through finance facilities and other assets, with long term financing secured at a funding rate of less than five percent.

 

Calls for Australia’s leaders to reduce food waste

OzHarvest will team up with the United Nations Environment Programme (UNEP) and the UN’s Food Agriculture Organisation (FAO) Global Initiative on Food Loss and Waste Reduction (SAVE FOOD) to lead the third annual Think.Eat.Save campaign in Australia and raise awareness on global food loss and waste reduction.

The campaign will launch at Parliament House Canberra on the eve of World Environment Day, June 4, and culminate in the national Think.Eat.Save event taking place across seven Australian cities (capital and regional) on Monday, 27 July.

Environment Minister the Hon Greg Hunt MP, Shadow Environment, Climate Change and Water Minister the Hon Mark Butler MP, Deputy Greens Leader Senator Larissa Waters, UNIC Director Christopher Woodthorpe and OzHarvest CEO and Founder Ronni Kahn will come together to launch the 2015 Think.Eat.Save campaign, bringing attention to the impact of global food waste and raising national debate on how food sustainability and food security can be addressed at a local level.

OzHarvest is calling on the nation’s leaders to set a target to reduce food waste by 50 per cent by 2025 following the example set by EU nations such as France, Germany, the Netherlands and Austria. Food waste is currently costing Australians up to 10 billion dollars each year.

At the launch event, a lunch made from rescued surplus food will be prepared and served to Australia’s leaders by IHG Executive Chef at Parliament House Cris Purcell together with OzHarvest’s Chef for a Cause Travis Harvey.

Members of the public will also be encouraged to make a personal pledge to reduce food waste through a digital Think.Eat.Save campaign launching on the same day.

 

Kellogg’s partners with Brolton Group

Brolton Group has completed a project for Kellogg’s Australia to increase their raw materials storage capacity.

Kellogg’s Australia has utilised an unused garden at their Botany facility to build an efficient, high performing grain batching and storage solution, without disturbance to local residents.

The brief was to increase their grain storage capabilities and supply a means to unload grain from tankers, as well as from a bulk tipping storage facility. Kellogg’s aim was to convey various grains to the new storage silos, which are then batched as required by the plant production.

Brolton Group designed, fabricated and constructed the extension to the facility, which is designed to be capable of 24/7 operation, 365 days a year.

The solution included 6 stainless steel silos from 100T-300T, pneumatic truck in load system, pneumatic transfer to the plant, complete control system with SCADA, all support structures including platforms, stairs and pipe bridges, and civil works including roads and stormwater.

 

SPC opens first stage of $100 mill redevelopment

SPC has delivered of the first stage of a $100 million investment program with the completion of a snack line.

“Today we celebrate the completion of our new snack line. The $100 million co-investment between our parent company Coca-Cola Amatil and the Victorian Government, has been put to work to drive new product innovation,” said SPC chief financial officer James Harvey.

“SPC is an Australian brand icon and, with the support of the Victorian Government, I’m pleased to say that our future is bright. We thank Premier Andrews and his team, who have been unwavering in their support for SPC. They have played a critical role in assisting us with our transformation plans and helping to secure the company’s future in the Goulburn Valley.”

The new SPC Snack Line will improve quality and innovation capability.

“SPC has worked with our suppliers to deliver this first major milestone in our investment plan in just six months – that’s record time from ordering to operating. We were determined to produce this season’s fruit using the new line with our new-look snack cups, which are in store now,” Harvey said.

The new line can produce any of SPC’s food products in cup format. It has an improved gentler cooking process that produces higher quality product.

One of SPC’s new innovations is SPC ProVital – a brand that delivers high quality product for people who have difficulty opening packaging or in some cases swallowing food. “We’re excited about the potential of SPC ProVital because it’s the first of its kind for the healthcare market. It’s a range of easy-open portion-control fruit that is more accessible for patients and reduces waste during serving and consumption,” Harvey said.

“We’re proud to be recognised for our strong commitment to Australian grown and made food. Due to its popularity, this week we’ve extended our #MyFamilyCan campaign to promote our farming families.”

SPC’s incoming Managing Director, Reg Weine, said he was excited by the opportunities ahead. “Our $100 million investment program will continue to build SPC’s capability and capacity as we transition to a modern branded food business. Importantly, it allows us to deliver product and packaging innovation, efficiency and productivity improvements and extend the brand as we enter new channels and markets.”

 

Boxed beef sales prompt AACo turnaround

The Australia Agricultural Company has reported a statutory net profit after tax of $9.6 million this year, a $49.5 million improvement on the previous year.

Last year, the company made a loss of $39.9 million but has since switched its strategy to transform from a pastoral company to a beef producer and marketer.

In the first full year of its strategy, the company saw a 42 percent increase in sales of its boxed beef, which AACo Managing Director Jason Strong said shows significant progress in transforming the company.

“Sales of boxed been now account for 77 percent of revenue, up from 59 percent in the previous corresponding period,” he said.

“In the last six months, this included the first sales of boxed beef from our new Livingstone Beef processing facility at Darwin

“These sales are into global markets where our traceable supply chains, sustainable practices and unique Australian heritage can command premium prices. Building our brands is the next stage of transforming and growing our business.”

The Australian Agricultural Company opened Livingstone Beef in the Livingstone Valley, about 50km southeast of Darwin, in late February.

The facility will process up to 1000 head of cattle a day at full capacity and it will produce export beef, hides and rendered products.

 

Mouvex eccentric disc pumps limiting product waste in food processing

Lobe and piston pumps traditionally used in the food processing industry
deliver excellent benefits including good sanitary qualities and flexibility of
application across multiple products. However, food manufacturers are also
aware of the limitations of this technology. High maintenance costs, low
accuracy, poor volumetric consistency and significant product loss have been
accepted by the food manufacturing industry as inevitable.

All these problems are caused by constant rebuilds, leaking seals, and
leftover product at the bottom of tanks and in pipes.

Eccentric disc pumps offer the most efficient solution for this
situation. Operating on the eccentric movement principle with the disc placed
inside a pump cylinder rotating and creating two distinct pumping chambers, the
pump produces a regular flow rate with low pulsations, low cavitation, and
limited slip or shear even when handling delicate products.

Eccentric disc pump manufacturer Mouvex lists out the advantages of
their pump technology over competing technologies. These include self-priming
design, effective line-stripping, high volumetric consistency against varying
pressure, viscosity changes and wear, no mechanical seals or pulsation, dry-run
capability, totally hygienic (CIP, 3A, EHEDG approved), and low shear
performance.

Eccentric disc pumps have proved their worth in various applications in the
food processing industry with their ability to reduce operational costs via
product recovery capability.

A manufacturer of cookies was losing about 50kg of white chocolate
coating per week, and was also forced to clean the pump several times each month.
After changing over to an eccentric disc pump, the manufacturer was able to
achieve trouble-free 24/7 operation.

A sauce manufacturer was rejecting 15-20% of the pouches for not meeting
the pre-determined weight due to poor volumetric consistency of an ECP pump. Changing
to Mouvex’s eccentric disc pump allowed the manufacturer to save on time and
money and significantly reduce product losses.

A yogurt manufacturer was losing more than $100,000 in product per line
per year. The Mouvex eccentric disc pump helped recover over 70% of the product
and significantly improved their bottom line.

Mouvex eccentric disc pumps are also used by
Australian manufacturers to pump chocolate, glucose, galacto-oligosaccharides
(GOS), yoghurt, cream and sauces. 

a2 Milk Company approved for ASX listing

The a2 Milk Company Limited (a2MC) has gained in principal approval to list on the Australian stock exchange, subject to customary pre-quotation conditions.

The Auckland-based milk marketing company issued a statement which said it is not planning any capital raising as part of the ASX listing process.

According to AAP, a2MC plans keep its New Zealand incorporation and NZX listing.

The ASX has not yet confirmed the date on which the official listing will commence. However, a2MC expects to be able to soon make it public.

The company announced its intention to list on the ASX in November.

"With a significant part of our earnings and growth coming from Australia, seeking an ASX listing is a logical strategic move for the company," Geoffrey Babbage a2’s managing director said at the time.

"Listing on ASX will enable more Australian investors to participate in the company's growth and will increase the attractiveness and liquidity of its shares. The board believes that this will benefit all shareholders."

Earlier this year, Curtin University received funding from a2MC to conduct a pilot study into the digestive benefits of a2 milk, and found that subjects on a diet of a2 milk reported less bloating and abdominal pain than those consuming A1 milk.

McCormick sets out flavour trends for this year

Herb and spice maker McCormick has released its McCormick Flavour Forecast 2015 and laid out the eight flavour trends to expect this year.

Now in its 15th year, the Flavour Forecast has come to be one of the most highly anticipated events on the culinary calendar.

It has predicted trends that have changed the way people eat at restaurants and cook in their home kitchens. And it has foreseen what consumers are purchasing from supermarket shelves.

“While our report highlights global flavour trends, we are certainly seeing many early trending flavours appear in Australia. Take chipotle chilli, for instance,” said McCormick Foods Australia Culinary Manager, Simone Fergie.

“When we first identified this chilli as a flavour to watch in 2003, many people couldn’t even pronounce it! Today, it’s featured in mainstream recipes and products. Pomegranate, sea salt, coconut water and cocktail inspired flavours like bourbon and rum have seen similar success, taking over restaurant menus and retail store shelves. The flavour trends highlighted within our 15th annual Forecast promise to do the same.”

Eight Flavour Trends for 2015

Sour + Salt                       

Combining coarse salt with surprising sours like pickled ginger, sour cherry, dried mango and lemon zest results in a lively finishing flavour that lends brightness and texture to dishes.

Liquid Revolution

Fresh purees and juices blend with bold spices and herbs to intensify sauces, pasta, dressings and more – providing a fun, delicious way to enjoy an extra serving of fruits and veggies.

Global Blends On the Move

Japanese 7 Spice (Shichimi Togarashi) offers a new kind of spicy heat, while Shawarma Spice Blend lends warm, spiced flavour to grilled meats and more.

Umami Veggies

For a fresh way to savour the tempting “fifth taste,” look no further than naturally umami-rich veggies like mushrooms, tomatoes, sweet potatoes and nori.

Cookies Reimagined

Classic spiced cookie flavours take new form in decadent, imaginative desserts that redefine “milk and cookies.”

Smoked Spices

Smoking spices and herbs deepens their flavour and aroma, adding richness to meals and drinks.

Middle Eastern Mezze

These distinctive dips and spreads, packed with zesty herbs and seasonings, offer an approachable and delicious introduction to a vibrant global cuisine.

Flavour Worth the Wait

Lift the lid to discover rich flavours from global recipes that meld aromatic spices and comforting ingredients into mouthwatering slow-cooked meals.

Livingstone Beef $100 mill processing facility opens

The Australian Agricultural Company has officially opened Livingstone Beef in the Livingstone Valley, about 50km southeast of Darwin.

According to ABC Rural, the new abbatoir has started exporting, with the first container sent out of Darwin bound for Hong Kong.

The new facility will process up to 1000 head of cattle a day at full capacity. It will produce export beef, hides and rendered products.

Stock will be sourced from the northern areas of Queensland, South Australia, Western Australia and the Northern Territory, supporting northern Australia's cattle industry where there are currently no processing facilities.

The facility will allow cattle to be processed in northern Australia, reducing transport and freight costs as well as carcase weight loss for northern producers who currently need to truck live cattle large distances to southern processing plants.

At the launch, Prime Minister Tony Abbott said the opening was “a sign of the new hope that has returned to agriculture in Northern Australia.”

“This is the biggest private sector investment in agriculture in Northern Australia for many a long year.”

“I'm also really pleased that thanks to the Free Trade Agreements put in place by Andrew Robb under this Government, that the prospects for our agricultural exports, particularly our beef exports, have never been better.

“Soon, thanks to these Free Trade Agreements, there will be a zero tariff on Australian beef exports to Korea, a zero tariff on Australian beef exports to China and a much reduced tariff on Australian beef exports to Japan, which is our largest beef export market and all of this means that Australian cattle producers have got a magnificent opportunity to export our clean, great produce to the wider world.

“There is so much that we can do for the wider world and what we do for the wider world in beef is obviously immeasurably boosted by the opening of this fine facility here near Darwin today,” Abbott said.

 

GrainCorp Foods to upgrade processing facility in Victoria

GrainCorp Foods will upgrade its processing plant in West Footscray, Victoria, to deliver extra capability including retail spreads, bakery fats, and shortenings.

The project is part of a wider initiative by GrainCorp Oils to integrate its edible oils and spreads manufacturing operations, which will increase its overall competitiveness and reduce carbon emissions by around 25,000 tonnes per year.

The wider initiative will involve relocating GrainCorp Foods’ processing and packing operation in Murrarie, Queensland, to its existing operation in West Footscray, Victoria, as well as GrainCorp Oilseeds’ existing operation in Numurkah, Victoria. In turn, these operations will be expanded and upgraded to accommodate the additional capacity.

The move will ensure greater integration of processing and packing operations from Queensland, to Victoria and New South Wales, where oilseed is already largely grown and crushed.

It will also reduce the trucking distance of the final product by 550,000 kilometres per year to customers mostly based in Melbourne and Sydney.

Wiley business operations director Simon Spittle said: “Based on GrainCorp’s brief, we created a design for the West Footscray upgrade to align with the company’s wider integration objectives.

“A major outcome of the project will be improving environmental performance by reducing carbon emissions by around 25,000 tonnes per year, thanks to the disuse of coal-fired equipment currently used to generate steam at the Murrarie plant.

“GrainCorp’s investment in its West Footscray and Numurkah sites will eliminate the need for the coal-fired equipment, providing GrainCorp with the opportunity to invest in more efficient and environmentally-sustainable technology.

“We look forward to working with GrainCorp on the upgrade to the West Footscray operation and seeing its completion in September.”

GrainCorp Oils group general manager Sam Tainsh said: “The project delivers a logical and more efficient focal point for the sourcing, crushing, refining, and distribution of GrainCorp’s locally-produced edible oils and food ingredients.

“We’re pleased to welcome Wiley on board to assist us in the design and construction of the upgrade to our West Footscray facility.

“GrainCorp has successfully worked with Wiley on a previous project. Their expertise in complex food manufacturing facilities made them the right fit to undertake this project.

“The increase in efficiency will ensure we are able to continue producing Australian-grown canola and other oilseeds, and therefore continue supplying associated retail products, which are increasing in demand.”

 

Explainer: what is halal, and how does certification work?

Halal food certification in Australia has become a contentious issue. Recently, a Western Australian cafe received hateful and anti-Islamic messages after its owners tried to explain halal on Facebook. A South Australian company stopped certifying its yoghurt in November 2014 after it was targeted by a social media campaign.

And on Tuesday, independent senator Jacqui Lambie threatened to introduce a private senator’s bill to close what she claims are “legal loopholes” that:

… could allow financing of terrorists and Australia’s enemies through halal money.

Lambie is not the first to raise the issue in federal parliament. WA Liberal MP Luke Simpkins claimed that halal is converting unwitting consumers to Islam. LNP MP George Christensen linked halal certification to religious extremism.

Activist groups are telling consumers to boycott halal products. They also claim that certification funds extremist groups and is part of a campaign to introduce sharia law.

Halal food certifiers and others in the Australian Muslim community have rejected these claims, and those who make them are yet to produce any evidence. But a lack of transparency from certifiers, along with a fragmented marketplace and confusion over what the halal certification process involves, creates a climate of uncertainty for anti-halal campaigners and Muslim consumers alike.

What is halal food?

Muslims choose to eat halal food because it meets requirements that they believe make it suitable for consumption. Halal originates from rules set out in the Qur’an and the Hadith (the Prophet Muhammad’s example), which have been followed throughout generations of Islamic practice.

As a concept, halal does not only pertain to food. Halal means “permissible” and can refer to any aspect of life covered by the teachings of Islam.

Halal is a part of sharia as a system of morals to guide Muslims' actions and behaviour, but this should not be confused with halal as part of a codified system of sharia law. Halal prescriptions might be considered by observant Muslims to be religious obligations, but Australia is a secular country and halal forms no part of any Australian law.

As with many aspects of Islamic practice, the definition of halal food is a contested issue. For example, there is disagreement within the Muslim community about whether stunning animals before slaughter produces halal meat. Both sides draw on Islamic teachings and traditions to support their positions. Disputes such as this highlight why halal certification is important for Muslim consumers.

 

Above: For Muslim consumers, knowing how the food was produced is an important consideration. Raqib ChowdhuryCC BY

How does halal certification work?

There are three different types of halal certification in Australia.

Individual products can be certified, meaning the production process and ingredients in that particular product are halal. So a consumer could buy halal yoghurt, for example, from a store that also sold non-halal yoghurt.

Production facilities can be certified, so that any products produced according to the certification standards can claim to be halal. For example, in an abattoir that is certified to produce halal meat, the meat will be halal no matter what cuts or final shape the meat takes. However, it may not even get labelled as halal when it reaches the market.

Retail premises can also be certified so that all food prepared and sold from that business is halal.

The halal certification process varies depending on who is performing the service. This is where uncertainty creeps in. Muslim consumers are largely unable to find out exactly what process has been followed in the certification process and what standards have been set by the certification provider.

Why is halal certification needed?

Halal certification is needed in Australia for two key reasons.

Firstly, certification helps local Muslims decide which products to buy. Modern food processing and globalised markets make it hard for Muslims in Australia to know how their food was produced and where it has come from. To get around this uncertainty, consumers who want to buy halal food need a system that checks whether products meet the requirements of being halal.

In this sense, halal certification is similar to any type of food certification and audit system. Whether it be halal, kosher, gluten-free or organic, food certification services help consumers to make informed decisions about the food they eat.

The second reason has to do with trade. With the global halal food trade estimated at A$1.75 trillion annually, Muslim markets provide a lucrative opportunity for Australian companies. If companies want to export their products to those markets, they need to have halal certification.

Who certifies halal food?

Certified halal products in Australia can come from two sources: domestic products that are produced locally and certified by local businesses, or imported products that have been certified overseas.

Numerous halal certifiers operate in Australia. The Department of Agriculture maintains a list of Islamic organisations that have an “Approved Arrangement” to certify halal meat for export. There are 21 such organisations operating in Australia as of November 2014.

Above: Companies around the world are embracing halal to compete in the large Muslim market. Mark Ghosh/FlickrCC BY-NC-SA

However, Australian government regulation applies only to providers that certify meat for export. While much of this meat may end up in the domestic market, certification providers that service only the Australian market do not come under any government regulation.

While some halal certification providers are associated with, or part of, larger Australian Islamic organisations, such as the Australian Federation of Islamic Councils, others are stand-alone businesses that provide local certification services.

With so much uncertainty about what constitutes halal, how products are certified and who is doing the certification, consumers who wish to buy halal food can find that a difficult task.

For non-Muslim Australian consumers, however, halal food is little different to any other food available. It only matters whether or not food is halal if a person has the religious conviction and desire to eat only halal food. Although improvements could be made, halal certification is one way Muslims are able to do this.

The Conversation

This article was originally published on The Conversation. Read the original article.

 

Simplot’s pay negotiations reach a compromise

After almost a year of negotiations, Simplot workers in Tasmania and New South Wales have agreed to a 6 percent pay rise over three years.

Workers in Devonport and Ulverstone voted in favour of the new agreement, which was reached between the company and unions in November last year, ABC News reports.

In October, The Fair Work Commission announced it would facilitate talks between vegetable processor Simplot, and the Australian Manufacturing Workers Union (AMWU).

The unions initially called for a 12 percent pay rise over three years, while Simplot offered four percent.

At the time, the company said it needed to restore competitiveness before it can consider such significant pay rises, referring to the industrial action as “reckless”.

Managing director Terry O'Brien said the company had achieved flexibility to run the plants at different times while compromising on a pay rise for Devonport and Bathurst workers.

“We didn't want to pay anything in year one to those vegetable plants and we have,” he said.

“Other than that we've maintained a number of benefits that we would've preferred to not have but we've let them go in return for these flexibilities.”

He said in return, the company would have more flexibility around when the plants can operate, based on seasonal factors.

“The main thing that's been achieved is that we've kept all these jobs in Tasmania and we're going to continue to pay people well and truly above-award wages – which we do,” he said.

“I think the outcome is really just … business as usual and everybody wins.”