![Buying cattle on commission ‘a cut-throat game’ Buying cattle on commission ‘a cut-throat game’](/images/transform/v1/crop/frm/38U3JBx5nNussShT8aZyYjc/ac10f99a-99dc-4f51-bdf7-4ee679704c99.jpg/r0_258_4957_3047_w1200_h678_fmax.jpg)
COMMISSION buyers who operate at saleyards say attempts to force them to publicly reveal information about their clients and orders will hinder their competitiveness, in turn reducing heat in the cattle market.
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Responding to an Australian Competition and Consumer Commission (ACCC) recommendation for a mandatory buyer’s register at saleyards, Northern NSW and Queensland buyers said they already operated in a cut-throat environment with very slim margins and a move like this would push people out of business.
That could only be to the detriment of producers looking to obtain the most competition for their stock, they argued.
The ACCC made the recommendation, among many others, in its interim report following a six-month market study of the cattle and beef industry. The aim is to reign in what many producers see as a lack of transparency and conflict of interest where buyers might have similar clashing orders.
Commission buyers, who at many Eastern Seaboard sales make up more than half the buying power, say it would be an impossible measure to enforce in any case.
“No one will give away that sort of information with any accuracy - we’ll just say things changed during the course of the sale, which they quite often do anyway,” one said.
Asking not to be identified for fear of business being affected, numerous buyers spoke with Fairfax Media in the wake of the interim report, saying it was the commission buyer who added the real competitive tension to the marketplace, because salaried buyers were limited to their boss’ instructions.
They also said trying to limit the number of clients they can operate on behalf of at any one sale would spell the end of many small saleyards.
While this was not a recommendation in the ACCC report, it has been touted in other investigations into competition at saleyards.
The typical commission charged to buy cattle is $4 to $5 a head so multiple orders were a pure necessity, buyers said.
“There is not huge money in this and it’s a livelihood that comes with a lot of risk,” one buyer explained.
“I can leave home at 4.15am, travel three hours to get to the sale, be on the go all day - all with the idea I might not buy a single beast so I don’t make a dollar for the day.
“We are opportunists. We often buy on the spot if there is a good deal to be had and then we have to bash the phone to try to place those cattle.
“It’s about using your reputation and knowledge of your clients and the market to take advantage of good value but it can come unstuck, we just factor that in.
“I don’t think people on steady wages understand that inherent risk.
“Bottom line is, if these type of rules are brought in, it just won’t be a viable business and that’s a whole lot of less competition for cattle at a saleyard.”