Setting the tone and pace for driving the red meat industry forward

Setting the tone and pace for driving the red meat industry forward

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Picture: Lucy Kinbacher

Picture: Lucy Kinbacher

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Opinion editorial by Red Meat Advisory Council chair Don Mackay.

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In 1997, then Minister for Agriculture the Honourable John Anderson set in train the creation of the Red Meat Advisory Council and three incorporated companies, the Australian Meat Processor Corporation, LiveCorp and Meat and Livestock Australia.

At the time, this was a giant stride for Australia’s red meat industry and reflected the growing commercial opportunities for the sector at home and in international markets.

Trade agreements existed with just New Zealand compared to the ten in place now, plus the four pending, and the average Australian was closer to food production and the bush compared to today with more Aussies than ever residing in our cities.

For the Federal Government, in the late 90s, the Red Meat Memorandum of Understanding was a far-sighted initiative which gave leadership and governance of the red meat sector back to “industry” and allowed it to take advantage of growing global trade.

It also kept the Federal Government at an appropriate arms-length from driving growth strategies, market development and trade and market access.

Across the red meat supply chain, red meat businesses paid for marketing, research and industry development programs via levies to industry-owned bodies – AMPC, LiveCorp and MLA – so industry could identify, deliver and invest in priorities themselves.

Objectives and benchmarks for success were set via the Meat Industry Strategic Plan, as they still are.

Industry was able to demonstrate to government and our own business community the immense economic potential of our sector and the wide-ranging public benefits from intensified red meat production, processing and export of both boxed red meat and the export of livestock.

Without doubt, Aussie red meat has come an extraordinary distance in 20 years, whether you are a consumer of red meat, a non-consumer, a business of any size within the value chain or a decision maker.

Aussie red meat has now grown to contribute $18 billion to Australia’s economy annually; encompasses 82,500 red meat businesses and contributes directly and indirectly to 438,000 Aussie jobs.

Seventy percent of our produce, both processed and live, finds its way into vital and premium offshore markets.

Australia remains a global leader in beef, sheepmeat and goatmeat exports and has the privileged position of being a red meat supplier of preference to countless families and communities worldwide.

Successive Statutory Funding Agreement Reviews and the MISP 2017 Progress Report clearly demonstrate the value set down by working together through the Red Meat MOU.

We are an industry that has pioneered traceability and eating quality through the National Livestock Identification System and Meat Standards Australia that has helped successive Australian governments deliver an ambitious trade reform agenda and has set a world class sustainability schedule as recognised by the work of the Australian Beef Sustainability Framework.

We have become a big, brilliant and thriving industry that spans from farmgate, to feedlot, to manufacturing, to retail, export and livestock export.

New markets and opportunities are emerging all the time, driven in no small part by the quality of our offering and the foundations provided by the 1990s reforms.

This growth has made us complex, diverse and hyper-competitive.

The red meat industry is not just farmers or processors, but a sophisticated food supply chain, that operates 52 weeks a year, delivering to over 24 million customers in Australian and millions more world-wide.

Because of the legacy of the Red Meat MOU, producers and processors alike have never had so many market options both at home and abroad.

What is widely understood but rarely acknowledged is that as a supply chain, farmers, lotfeeders, manufacturers, retailers and exporters are all customers to each other and the interactions are intensive.

This translates to the relationships between the service providers and peak industry councils that sit astride the supply chain.

After 20 years, the Red Meat MOU could be seen to drive division between segments of the supply chain, organisation by organisation, and provide different levels of authority, funding and resources to each.

Our resources and investment levels can potentially be constrained by the provisions of the MOU.

Of course, a continued levy framework and Federal co-investment is never a guarantee that resources will be directed to the areas of greatest need for industry.

The simple fact is that our industry faces many more challenges than it did 20 years ago.

Some would argue we are standing on a burning platform.

Significant parts of our supply chain could disappear completely due to costs-to-operate; whilst others could be simply regulated out of existence to address at times poorly advised community concerns.

Social licence

There is a growing public debate and competing science around obesity and health, market consolidation, environmental management and the treatment of our livestock within our care that are very real threats to our industry.

Some consumers, both those with a taste for red meat and those who reject it, remain unconvinced red meat is good for human lives at all and consider our industry’s nation building economic credentials largely irrelevant.

The public too will have a say on the security of our industry. They will vote on animal welfare, they will choose whether to purchase our produce and they will be citizen activists.

They will provide us with our collective social license.

To ensure the future prosperity of our industry, social license to operate needs to become a social norm across all sub-sectors of red meat.

No-one will buy our sheep, goatmeat or beef unless they are convinced that it is raised, transported and processed ethically.

We need to embrace these concerns and take responsibility for charting a better red meat future, as an industry.

We need to do better at setting appropriate rules for industry and develop effective guidelines for dealing with businesses who fail to address concerns about the welfare of their animals.

We may never satisfy an activist agenda, but we must do everything we can to satisfy the community and ourselves that we are doing the right thing.

Reform to a higher-end, more premium product will only be achieved with genuine supply chain collaboration and any future Red Meat MOU needs to address this.

We need only look at the $1-dollar milk scandal for our counterparts in the dairy industry to know how damaging this can be in the eyes of the public and for the business community for a supply chain constantly at odds with one another.

And then there is the cost of our product. Affordability on supermarket and grocery store shelves paired with rising cost of living for Australians as a whole may change the continued public support of our industry from the levels they are at today.

The world we live in now compared to the late 90s is infinitely more complex and we are facing renewed competition from countries like the United States and Brazil where red meat production remains substantially cheaper than it does in Australia.

We need to do more with less, work better together and ensure our sustainable future with our Aussie customers, voter base and influencers.

We work for Australian red meat businesses both pre or post farm gate but the real success for our businesses will be realigning red meat with our millions of end-users – our wonderful customers who enjoy red meat here at home in Australia and abroad.

The Red Meat MOU is more than just a high-level document, it sets the tone and pace of what will drive our industry for the next 20 years and how we can further build our industry to address these critical issues.

As part of the Red Meat MOU, the Red Meat Reform Taskforce is currently engaging with red meat industry stakeholders to chart our road ahead. My challenge is to all members of this industry to get involved to help tackle these big issues and be part of the solution.

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