Affco: here for the long haul

The highly competitive nature of New Zealand's meat processing industry means any advantage one company can gain over its competitors has to be seized.

And having flexibility in the workplace would give a company an edge, according to Andy Leonard, Affco NZ general manager.

While Mr Leonard would not discuss the company's relationship with the unions, he said given the environment they operated in, coupled with lower livestock numbers and increased competition, "any flexibility in operations is important to remain competitive".

"Affco has a strong team of livestock agents who have solid relationships with farmers and we pay fair market pricing for livestock consistently throughout the year.

"Affco also has large-capacity plants in well situated regional locations throughout the North Island to ensure farmers get stock slaughtered locally when they need the service," he said.

While loath to put the Whanganui operations in dollar terms, he would only say the industry ran on "extremely fine" margins.

He said talk that Affco could "walk" from its operations here was probably fuelled by the combination of decreasing livestock numbers and industry overcapacity. He said this resulted in various scenarios being played out by those looking at the meat industry.

"Affco's committed to Whanganui with both its plant operations. We have invested heavily in both plants and our goal is to continue to operate for the long-term. We are a major employer and contributor in the town and wish to see that continue," Mr Leonard said.

Affco operates two processing operations in Whanganui - the Imlay plant in Gonville and Land Meat at Castlecliff. Imlay processes lambs and mutton only and predominantly for export, with the majority going to China, the United Kingdom, Europe and the United
States.

Land Meat processes mainly beef and pigs and while it has a strong presence in the local market, some beef is exported.

"Land Meat actually has a local market sales team selling beef, lamb, pork to local market customers in the bottom half of North Island," he said.

Both Affco's plants are major dischargers into the city's wastewater treatment plant and have been embroiled in lengthy discussions with the district council about how much they should pay and how much they are willing to pay to continue that arrangement.

Last month, the company made it clear that if the numbers stack up it will be a part of the new treatment scheme.

Overall costs of the treatment plant have been put at more than $41 million, and initial forecasts had trade waste rates at $4.5 million annually. They are about $2.5 million and nearly half of that is paid by Affco.