Industry paper provides options

A co-operative merger would address some of the fundamental differences between the dairy and red meat industries including the variation in supply patterns and differences in product form.

In December, Federated Farmers launched Meat Industry Options: A Discussion Paper to our members. The document is an initiative designed to stimulate informed debate on the future of our red meat industry.

The paper outlines a range of options in three categories: behaviour, processor and marketing-focused options. The options presented are a bit like a ``pick and mix'' with numerous combinations possible.

The behaviour-focused option highlights the influence farmers can have through the choice of where they supply their livestock. First, you must decide what is important to you and your business and what you want the industry to look like in the future.

Then you can look to understand the different companies and their strategies and choose to supply a company who shares your values and vision for the future. It is also important to communicate with the company you supply, to build and maintain a strong relationship. This will help shift the focus from procurement to what the market wants.

We also look at the positive role stock agents could play in optimising farming systems.
In the processor-focused options we explore a co-operative merger. This addresses some of the fundamental differences between the dairy and red meat industries including the variation in supply patterns and differences in product form. It also looks at commodity and value-added markets and variation in investment levels between the two industries.

We look at tradeable processing rights which are similar in concept to fisheries quota management. It would need legislation but it could help to reduce industry overcapacity.
Toll processing is investigated which separates out processing and marketing, allowing each to focus on their core business and avoid trying to be all things to all people.

The possibility of overseas investment is explored including the impact that might have on the future shape of the industry.

A final processing option highlights transparency of information based on the Uruguayan model of information sharing, regarded as the best in the world. It could help to improve co-ordination, collaboration and in-market behaviour while generating value and demonstrating where that value is being added.

In our section on marketing-focused options we explore a single desk seller and how that could help to achieve critical mass. As well as co-operation where exporters collaborate in certain markets while remaining independent in others.

Another marketing-focused option is for multiple marketing companies with strong producer and customer/consumer relationships. This option is dependent upon toll processing indicating how interrelated our options are.

A twist on market collaboration is for an ANZAC approach, where Australia and New Zealand unite to achieve greater scale while improving research investment and market development.

Going larger still could see an alignment between the northern and southern hemispheres to match seasonality of supply.

This could help to keep red meat products on the shelves in the face of competing proteins.

The paper has now been widely circulated and discussed.

If you have not yet read the paper, I encourage you to do so. A copy can be downloaded from our website. Then you too can join the discussion as it is up to you as farmers and suppliers to decide what you want the industry to look like in the future and how your behaviour will influence this.

We are welcoming feedback from our members via the online survey or through your provincial executive and meat and fibre chairperson. Your feedback is critical to us as the meat and fibre executive craft our strategy and we look to the future with a vibrant red meat industry.