![Elders won’t be rushed to sell live export arm Elders won’t be rushed to sell live export arm](/images/transform/v1/crop/frm/32XghFRykTWK8psrWNhdBMC/12dc98a5-91c9-407c-877f-d668af0e7dcf.JPG/r602_394_4676_3000_w1200_h678_fmax.jpg)
After making its surprise September decision to quit the live export trade, long-time livestock shipper, Elders, is in no rush to sell its North Australian Cattle Company (NACC).
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Managing director, Mark Allison, said the company had received about 19 approaches from interested potential buyers and had compiled a shortlist.
“But if we can’t find the right owner in the short or medium term, we will be patient,” he said.
Despite the live export division losing almost $9 million last financial year, Mr Allison said Elders was determined to keep running the operation as a going concern for as long as it took to sell.
In fact, he was confident NACC would be making “good money by the end of FY17”.
Rival livestock exporter and farm services company, Ruralco, is also optimistic about reviving market prospects in nearby Indonesia.
Ruralco this week reported an 87 per cent slide in its live export gross profits to about $1m in 2015-16 because of high cattle prices and low sales margins.
Having already exited the long-haul live dairy and beef cattle and breeder sheep trade to China, Russia and the Middle East, Elders’ business is now fully focused on shipping beef cattle to feedlots in Indonesia, Vietnam and Malaysia.
“It’s not going to be an orphan child,” Mr Allison said, emphasising the company’s commitment to producers who supply cattle to the trade, the customers buying stock (particularly in Indonesia), and NACC staff.
Elders would also ensure its attention to animal welfare priorities continued during the sale period and the right buyer with the right animal welfare credentials was identified in a careful and calm manner.
"We do not have a deadline to get rid of, or close, the business," Mr Allison said.
The pending sale of the live export enterprise meant its $8.9m loss was not included in Elders’ headline $51.6m statutory profit number released on Monday.
But it did impact on the underlying profit after-tax figure of $41.2m.
Mr Allison said the move was “not a tactical ploy or cynical manoeuvre to get a higher number”.
While poor margins and high capital costs associated with long-haul routes had hurt the export business and prompted Elders’ swift withdrawal from long distance shipping and air freight, he fully expected NACC to generate positive results this financial year.
Those profits would also be excluded from Elders’ result next reporting period.
Meanwhile, rival Ruralco managing director, Travis Dillon, said despite a difficult year for his company, which included closing its southern long-haul freight business, its Frontier International Northern operation’s outlook was positive.
Ruralco directors and senior management had just returned from two weeks in Indonesia studying the market and “everything we saw suggested a positive picture” for future demand.
A good indicator of the Indonesian government’s support for the trade had been recent government spending to upgrade about 5000 wet markets for meat sales.
“There have been some headwinds in the trade in the past 18 months but we are certainly committed to the market,” Mr Dillon said.