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Senate Inquiry Draws to an End

The Senate Inquiry into ‘the collection and disbursement of the grassfed
cattle levy’
is due to be finalized on September 23rd, with the Senators tabling their report or recommendations. Then the Federal Minister for Agriculture, Barnaby Joyce will decide on what action to follow.

When this Inquiry was first announced, it seemed that Senators and many others thought that there would be a quick, clean and decisive report done on the issue, following only one Hearing.  It was thought  the dissatisfaction felt by the grass fed cattle producers would once again amount to little involvement by the ‘whinging’ producers, and their issues would be reviewed and
‘put to bed’.

It was assumed that there really was nothing much wrong with the present system where five peak councils supposedly worked closely with the MLA.

What happened was that over 530 submissions were received  (the Senate website only shows about 200 odd as they did not show submissions that were repeats or bulk entries) and everyone was amazed at the responses by the producers, loudly stating their deep dissatisfaction.

Without trying to pre-empt any conclusions to any report, it would be fair to say some of the Senators have been rather taken aback at the evidence gathered.   ABA felt that they, the Senators,  recognised there were legitimate claims to “no transparency, no accountability, no democracy, no automatic right to vote, disenfranchised producers’, and much more.

During the Inquiry both the DAFF (who collects the levies) and MLA pointed directly towards the so-called Independent Reviews done on the MLA to justify their management.  These reviews spoke if all the ‘achievements’ of the MLA.

But ABA noted  the people sitting on these review panels and the people contacted to carry them out.  For the last review on MLA, over 70 not-very-independent people were interviewed – including MLA Board and staff.  Of the remaining interviewees, many also had a vested interest in keeping the same structure in place.

The ‘Under New Management’ MLA of today is promising that MLA will become more open and more transparent.  There is even strong rumours floating around that some MLA staff may be shown the door in the very near future.

While ABA appreciates that the new management  acknowledges some of the problems, the structure that is there today still does little for producers – the Memorandum of Understanding still requires that CCA consults with (as opposed to making the decisions for) MLA over their management of the grass fed industry;  still requires that all Peak Councils must agree 100% on issues for those issues to be followed through (remember the lot feeders’ and processors’ blocking actions during the livestock
debarcle);   controls all the grass fed levies. The present structure does NOTHING to make the representative body for the grass fed industry strong, accountable or well resourced.

While we realize that MLA is going to fight tooth and nail to keep control of the grass fed levy, it is definitely not to the advantage of the grass fed cattle producer, and ABA will speak strongly for management of their own funds, similar to the Processors and Live Shippers.

Last week the ABC interviewed John Clements, a consultant for Binderee Beef.  Mr Clements spoke about poor quality beef masquerading as prime beef,  and went on to say how much damage this did to the Australian beef industry.  It means that consumers are completely in the dark at to the quality of meat they are buying.   He discussed the Ausmeat ‘language’ used to describe beef for sale,  and the fact that consumers had little to no idea of the quality of the beef they buy.

In response,  MLAs  Regional Manager Lachlan Bowtell disagreed with John Clements and stated that consumers understood the
fact that a $7 cube roll  would not eat the same as a $27 cube roll.   Lachlan went on to say that the quality of beef has increased in leaps and bounds over the last two or three years; beef consumption is dropping but there are many reasons for the drop: MLA works closely with retailers, supermarkets and consumers which has lead to increased eating confidence;  and that eating quality of beef is at an all-time high!!!

Lachlan also stated that the quality of beef has also increased ‘out of sight’ over the last few years, and that most cow beef is ground into mince, pies and hamburgers.

The reality in the beef industry is that a good percentage of even young beef is also ground for hamburgers and mince.  A good deal of the carcass is trim and non-primal cuts but if the primals are taken off an older beast and sold under ‘A Grade’ description,  then beef credibility is destroyed and beef consumption and trust is lost for a very long time, maybe forever.  The other reality is that beef consumption continues to fall.

MLA acknowledges that eating satisfaction is one of the key factors to consumers continuing to eat beef.
Those consumers need a simple way of identifying the correct type of beef they need for their meal table.   Very few people understand the workings of MSA, even people working in retail meat.  It is simply too complicated and convoluted.

Lachlan stated out that beef makes up 38% of all meat eaten in Australia.

ABARE’s findings suggest that Australia’s  2012-13
consumption of meats per person included:
44.6 kg of chicken
32.8 kg of beef
26 kg of pork
9.5 kg of lamb

This makes the total for meat consumption to be at least 113kgs per person per year.

38% of 113kgs is actually 43kgs of beef, and we all know that even MLA charts will tell you that consumers are eating only about 32.5kgs of beef which is only 29%.  So consumption is continuing to fall !! If MLA’s prediction proves correct then Australian consumers will be eating less than 30kg of beef in 2014.

A recent MLA publication suggested that domestic utilisation (use of beef) is to ease by 10.6% to 662,000 tonnes (cwt) in Australia, which means that we recently were eating about 728000 tonnes (cwt)!  We should remember that the Australian  domestic market is by far the most valuable and biggest single market for our own beef.

In our top three overseas markets,  exports to Japan are forecast to rise to 270,000 tonnes (swt).
Exports to the US are forecast to be 210,000 tonnes (swt),   and beef exports to China are forecast to rise to 155,000 tonnes (swt).

Those three markets make up 615,000 tonnes (swt) of beef.

The Australian domestic market was 728,000 tonnes (cwt) of beef – or 728 million kilograms!!!!!
Now down to 662 million kgs (cwt)!! but still a large market.

That is a captive, willing  audience of beef purchasers whom are treated with contempt,  thanks to our current grading system using language that allows retailers to sell lower grade beef under ‘A Grade’ classification.    Shouldn’t we be looking at the spending of millions of producers’ money on the one questionable system, when the market is crying out
for a simplified true indicator of eating quality?

Surely the time has come for the MLA to employ ‘mystery shoppers’ who collect meat samples for MLA to assess, and make sure that the eating quality and descriptions are up to the standard that consumers expect and demand.

No mystery, no complicated equations,  just the sort of gradients that people can relate to like Gold, Silver and Bronze and Budget: or 5 down to 1 Star.  That would be a good start.   Certainly very simple and effective,  little cost to producers,  and a great
aid to keeping and developing more satisfied beef customers.

Daviud Byard


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