The beef barney: is another abattoir the answer?

Australia’s beef industry is one of the best in the world. High standard for cattle and for processing have led directly to a high reputation amongst other nations for the quality of its beef. But all is not well, writes Cole Latimer.

Australia’s beef industry is under attack.

Over the past 12 months the industry has come under fire for live exports and the standards of abattoirs in Israel and Indonesia, as shocking images of cattle being brutally slaughtered circled the nation.

The flames were fanned by environmental groups which stated that it is the beef cattle and meat processing industry’s responsibility to ensure the humane treatment of animals.

The response of the industry was to immediately distance itself, declaring that the common standards in Australia stood well above these other countries, whilst looking to address the live export issue, and the ever present supply chain problems.

But how?

With the construction of more abattoirs within Australia.

The meaty issues
A major issue with any industry in Australia has always been the tyranny of distance. The majority of beef cattle are grown in the most northern parts of Australia.

According to the Australian Bureau of Statistics within north-west Queensland there are approximately 3.4 million head of cattle alone, equating to almost 50 percent of Australian beef, with the Northern Territory and Western Australia’s Kimberley region making up a large part of the rest of what’s left.

However most of the abattoirs are located closer to major cities or the east coast of Queensland where ports are available, such as Rockhampton and Townsville.

John McVeigh, Queensland’s minister for agriculture, fisheries and forestry, explained to Food Magazine that “there are no abattoirs in the north-western region for producers, so their only option is to face the significantly high cattle transport costs to get them to a port or processor.

“The cost of transporting cattle is increasing due to animal welfare and driver fatigue regulations, rising fuel and labour costs, and insecurities about the live export market”.

Local cattle producer Rob Atkinson, says not only does moving live cattle cost a lot more in freight compared to boxed beef, it also “has animal welfare benefits, with a processing plant closer to where the animals are reared it means less time in the trucks for them as when we cart live cattle a long way we get what we call ‘shrinkage’, which is dehydration of the animals while they’re in the trucks.

“As a producer, because we’re paid by meat works on carcass weight, if there’s been shrinkage it’s less profitable,” Atkinson explained.

And there are even greater distances that Western Australia’s Kimberley region farmers moving their live cattle to finishing and processing sites face.

As the former Queensland minister for agriculture and food, Tim Mulherin, explained, “An enormous swathe of Australian cattle country currently isn’t served by local meat processing facilities – if you draw a line diagonally from just above Townsville to Perth [effectively splitting the nation in two], you would find no abattoirs north of this line.”

The supply game
Live export was seen as one of the few cost effective remedies to the logistics issue of transporting cattle to finishing and processing centres, as many of these farms are located closer to ports than major abattoirs.

But this has hit a stumbling block recently as the high Australian dollar cut the profits on export, and the government announcing reduced quotas for live cattle export and boxed beef, particularly into Indonesia.

The outrage from the Australian public over a Four Corners report detailing animal abuse in Indonesian abattoirs also dented the public’s opinion of our meat processing and abattoir industries.

So what’s the solution?

“Having a local abattoir would lower the cost of supply for graziers,” John McVeigh explained, while at the same time addressing issues surrounding live exports, transporting cattle and costs being passed down the line.

Going head to head
However the solution isn’t straight forward. In the race to solve the meat processing
problems a number of different groups came forward to operate an abattoir.

In Queensland’s north-west region a study analysed a number of potential with Cloncurry being identified as the most suitable for developing an abattoir.

However the relatively nearby town of Hughenden has argued the case for an abattoir in its town instead.

And while the two towns battle it out for support to even begin construction they collectively face much greater competition from a proposed ‘super abattoir’ in Darwin.

In November construction work began on a new $85 million abattoir near Darwin, which is slated to process between 120,000 and 200,000 head of cattle, some of which will come directly from the areas that the proposed Cloncurry and Hughenden abattoirs will source their cattle – threatening their potential viability.

According to Australian Agricultural Company Limited (AACo) general manager Stewart Cruden the site could be progressed through to commission as early as September this year, having already appointed both project management and construction companies for the meat works.

He said, “construction of the meat processing facility will create around 260 direct jobs and a further 560 indirect jobs for the region, injecting approximately $126 million a year into the local economy.”

But before anyone gets too excited, there’s another player in this race: a proposed $20 million Kimberley meat processing works.

The joint venture between Yeeda Pastoral Company and Kimberley Pastoral Investments, funded by a Singaporean equity fund, has plans to process around 55,000 head of cattle pear year by 2014.

The bones of it all
It can’t be denied that the public’s perception of live exports is hurting the sector’s image. This, combined with the logistical and transport challenges faces by producers, has caused calls for abattoirs in north-west Queensland, the Northern Territory, and northern Western Australia to intensify.

However the piecemeal way in which it has been approached, with many divergent views of where they should be located and the overlapping stock areas threatening the viability of the proposed abattoirs, isn’t productive.

The rush to ‘solve’ the issue will create more issues and potentially exhaust stock quicker than planned as the demand for more heads of cattle increases to fill facility quotas.

But at the end of the day an abattoir – any abattoir – closer to home can only be good news.

Image: ntnews.com.au, ciwf.org.uk and seekcommercial.com.au


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