PRESSURE is mounting to get on with the job of rolling out the first phase of objective carcase measurement (OCM) technology in all red meat processing facilities.
The processing sector in particular is being urged to come to the table to discuss financing.
Peak industry groups, particularly on the producer side, clearly think the wheels are turning too slowly and technology with the potential to massively boost Australia’s productivity and competitiveness on the global stage is sitting idle.
A bucketload of due diligence has been done, all pointing to enormous unlocked potential, and it’s time to move forward, they say.
The call is for a split between processor and producer levies to fund the rollout of DEXA (Dual Energy X-Ray Absorptiometry) in all plants.
It comes in the wake of a massive over-subscribing to Meat and Livestock Australia’s bid to meet the early demand from processors wanting the equipment in their abattoirs through an initial allocation of $10 million in co-funding.
MLA is now asking for formal agreement from the Australian Meat Processors Corporation (AMPC) to jointly fund an accelerated rollout.
The proposal would see the anticipated $150 million cost of fully installing DEXA units in up to 90 facilities shared between the processing and production sectors, reflecting the shared benefit the new system for accurately measuring lean meat yield would provide, according to MLA.
Sheepmeat Council of Australia (SCA) has backed the call, saying modelling indicates 65 per cent of a potential $420 million per annum benefit will be split between producers and processors so it’s time AMPC came to the financing discussion table.
The pressure being put on the processing sector follows the release on Friday of the results of an independent report it commissioned.
The EY report points to consensus on the utilisation of technology for OCM but argues a need for more information through pilot programs in beef to enable “evidence based decision making” by the broader industry and the processing sector, given their differing needs and business models.
The Australian Meat Industry Council (AMIC) has formed a specialised OCM/DEXA committee to manage progression of the technology within industry and provide direction on partnerships.
But producer leaders want to see AMIC shift it up a gear.
This technology is critical to ensuring Australian red meat remains competitive on a global stage, a number of producer leaders say.
Industry fast-tracked implementation of DEXA would enable scientific measurement of lean meat yield, increased feedback to producers and significant productivity gains for the processing sector, said SCA president Jeff Murray.
Cattle Council of Australia has the same opinion.
It has been CCA’s position from day one that financing the rollout had to be a mix of producer and processor levies, independent director David Hill said.
MLA managing director Richard Norton said the collaborative approach would realise more of the potential benefits from DEXA sooner.
“If AMPC and MLA can split the cost of implementing DEXA, we can capture greater efficiencies and ensure both the production and processing sectors pay their fair share,” Mr Norton said.
The fact the early allocation of funds for processors looking to move ahead with the technology had been so keenly sought was very encouraging, he said.
“But to fully capture the benefits all the reports have identified, boost our international competitiveness – and ensure no one gets left behind – we need to adopt this technology as an industry,” he said.
Mr Norton said multiple agencies and reports had now recommended the industry adopt objective measurement systems, including the ACCC in its recent cattle and beef market study and the red meat industry’s peak councils through their Meat Industry Strategic Plan (MISP 2020).
“We have the technology, it’s far superior to the inconsistent and unreliable systems in use now, it’s ready for commercial application and the benefits have been costed over and again,” he said.
“It’s now time to work together as an industry and get on with the job.”