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MLA’s Overview of Expenditure

The MLA has just released an overview of the impact assessment of the MLA’s expenditure from 2010 to 2015.

Under the terms of the Deed of Agreement, with Australian government, MLA must complete performance review at least six months before the expiry of the deed.

Is this an independent review? Conducted independently? How much work do these consultants rely on MLA? How many ex-MLA employees had a hand in writing this document? Does the MLA peruse the document before publication?

The executive summary suggests that for every dollar spent there is a benefit of $6.20. Is it possible that the MLA always has a positive impact for all its expenditure? If they always have a positive impact I would think they would be rather unique.

Some of their programs are very interesting. For example, maintaining and improving market access for every dollar spent it returns $14.80. Whilst with the market access program every dollar returns $24. Perhaps I am too cynical however with such great returns I would be asking how much the processors put towards these programs. Could it be possible that the benefit of MLA’s marketing helps processors and supermarkets though most of the funds are contributed by grass fed producers?

Growing demand benefit ratio for every dollar spent returns $5.20. Again I would question who gets the benefit of these campaigns. Supermarket prices rise no matter what happens to the price of cattle and again I would argue they get the most benefit.

Eating quality program, MSA, is at huge expenditure though out of every dollar spent we get $12.50 return. To my way of thinking this is a real beauty. MSA was developed in 1998 to address the slide of beef consumption. With DNA testing and independent graders it was a terrific system, however it failed to stop the slide of beef consumption. In 2016, substitution is rife and cattle that would have never made the grade under the original system are now being graded by company graders so that more cattle now make the grade. Great selling point but the real fact is consumption still continues to drop at an alarming rate.

MLA’s lamb marketing is built to defend the market share of Australian lamb in the domestic markets.  MLA’s annual Australia Day lamb campaign has been a highlight resulting in lamb owning Australia Day. Unfortunately this is only 1 day of the year. MLA suggests that for every dollar spent we get returns of $4.10.

The real problem comes when you realise that after the spike on Australia Day that consumption of lamb continues its downward spiral. In 2000 in Australia we ate through 18kg of lamb and now 2016 we are down to 8kg per man woman and child. How anybody can see this as a great success I will never know.

One thing lamb has got in its favour is that once permanent teeth erupt it is immediately classed as mutton. The point being that when you buy lamb you buy genuine lamb and there are severe penalties for substitution.

Beef Export Marketing program: again for every dollar spent there is $6.70 return; to whom? Australian beef export volumes have increased by 50% and the values have doubled in the last 5yrs.

The simple fact is we are getting more and more people looking to eat beef worldwide and this has simply driven demand and price. Is MLA responsible for this?? In any case the people funding these marketing campaigns do not necessarily get the benefit. What we have seen in recent years with drought forcing the price down to below the cost of production for producers is the processors lapping up record profits whilst leaving the producer to fund MLA programs.

Whilst processors can actually refuse to pay towards MLA marketing producers have no such luxury. If producers sit back and accept the situation we deserve all we get.


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