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- Start of Business
- MINISTERIAL ARRANGEMENTS
- QUESTIONS WITHOUT NOTICE
- DISTINGUISHED VISITORS
QUESTIONS WITHOUT NOTICE
(Mr FILING, Mr WILLIAMS)
(Mr SLIPPER, Mr TRUSS)
Taxation: Family Trusts
(Mr WILLIS, Mr COSTELLO)
Employment Services Tender
(Mrs BAILEY, Dr KEMP)
(Ms MACKLIN, Mr WARWICK SMITH)
(Mr BROADBENT, Mr VAILE)
(Ms MACKLIN, Mr WARWICK SMITH)
(Mrs GALLUS, Dr WOOLDRIDGE)
(Ms MACKLIN, Mr WARWICK SMITH)
Youth: Employment Placement
(Mrs DRAPER, Dr KEMP)
(Mr BEAZLEY, Mr WARWICK SMITH)
(Mrs STONE, Mr WARWICK SMITH)
(Mr BEAZLEY, Mr BRUCE SCOTT)
(Mr LIEBERMAN, Mr REITH)
- PERSONAL EXPLANATIONS
Answers to Questions
(Mr ALLAN MORRIS, Mr SPEAKER)
(Mr CREAN, Mr SPEAKER)
- JOINT HOUSE DEPARTMENT
- MATTERS OF PUBLIC IMPORTANCE
- BILLS RETURNED FROM THE SENATE
- MATTERS REFERRED TO MAIN COMMITTEE
AUSTRALIAN MEAT AND LIVE-STOCK INDUSTRY BILL 1997
AUSTRALIAN MEAT AND LIVE-STOCK INDUSTRY (REPEALS AND CONSEQUENTIAL PROVISIONS) BILL 1997
BEEF PRODUCTION LEVY AMENDMENT BILL 1997
BUFFALO EXPORT CHARGE BILL 1997
BUFFALO SLAUGHTER LEVY BILL 1997
CATTLE (EXPORTERS) EXPORT CHARGE BILL 1997
CATTLE (PRODUCERS) EXPORT CHARGES BILL 1997
CATTLE TRANSACTIONS LEVY BILL 1997
LIVE-STOCK SLAUGHTER (PROCESSORS) LEVY BILL 1997
LIVE-STOCK TRANSACTIONS LEVY BILL 1997
LIVE-STOCK (EXPORTERS) EXPORT CHARGE BILL 1997
LIVE-STOCK (PRODUCERS) EXPORT CHARGES BILL 1997
NATIONAL RESIDUE SURVEY (BUFFALO SLAUGHTER) LEVY BILL 1997
NATIONAL RESIDUE SURVEY (CATTLE TRANSACTIONS) LEVY BILL 1997
NATIONAL RESIDUE SURVEY (CATTLE EXPORT) LEVY BILL 1997
NATIONAL RESIDUE SURVEY (SHEEP, LAMBS AND GOATS TRANSACTIONS) LEVY BILL 1997
NATIONAL RESIDUE SURVEY (SHEEP, LAMBS AND GOATS EXPORT) LEVY BILL 1997
- AUSTRALIAN MEAT AND LIVE-STOCK INDUSTRY (REPEALS AND CONSEQUENTIAL PROVISIONS) BILL 1997
- BEEF PRODUCTION LEVY AMENDMENT BILL 1997
- BUFFALO EXPORT CHARGE BILL 1997
- BUFFALO SLAUGHTER LEVY BILL 1997
- CATTLE (EXPORTERS) EXPORT CHARGE BILL 1997
- CATTLE (PRODUCERS) EXPORT CHARGES BILL 1997
- CATTLE TRANSACTIONS LEVY BILL 1997
- LIVE-STOCK SLAUGHTER (PROCESSORS) LEVY BILL 1997
- LIVE-STOCK TRANSACTIONS LEVY BILL 1997
- LIVE-STOCK (EXPORTERS) EXPORT CHARGE BILL 1997
- LIVE-STOCK (PRODUCERS) EXPORT CHARGES BILL 1997
- NATIONAL RESIDUE SURVEY (BUFFALO SLAUGHTER) LEVY BILL 1997
- NATIONAL RESIDUE SURVEY (CATTLE TRANSACTIONS) LEVY BILL 1997
- NATIONAL RESIDUE SURVEY (CATTLE EXPORT) LEVY BILL 1997
- NATIONAL RESIDUE SURVEY (SHEEP, LAMBS AND GOATS TRANSACTIONS) LEVY BILL 1997
- NATIONAL RESIDUE SURVEY (SHEEP, LAMBS AND GOATS EXPORT) LEVY BILL 1997
- TAXATION LAWS AMENDMENT BILL (No. 5) 1997
Tuesday, 28 October 1997
Mr BOB BALDWIN(4.24 p.m.) —It is with pleasure that I rise to speak on the Australian Meat and Live-stock Industry Bill 1997 and related bills. The romance of the beef industry in Australian culture has no doubt been dampened over past decades as the direct conflicts of greater competition, regionalisation, altering economies of scale, faltering domestic consumption and changing consumer patterns have all had an impact on its growth and profitability. You can also throw into that mix a myriad of other factors.
Firstly, there is the drought, and the drought has continually dogged the industry sector in recent years, depressing prices and reducing the nation's herd size. The Hunter's prime beef cattle districts of Gloucester, Dungog, Maitland and Bulahdelah have not been immune from the impact of El Nino. Secondly, there is the area of food hygiene. Food hygiene has become very much a hot household issue of the 1990s, and it is a phenomenon that crosses the planet.
The world's first truly global food safety scare last year was the BSC, bovine spongiform encephalopathy, outbreak—more commonly known as mad cow disease—which resulted in an immediate collapse in world beef consumption. Figures ranged from 10 to 50 per cent in consumption falls across Europe and 20 per cent in north Asia whilst, inadvertently, the Australian market suffered an estimated five per cent decline, despite our total removal and link from the disease outbreak. A very much still depressed domestic marketplace and associated low beef prices continue to be reflected in official data. ABARE forecasts for beef producers during 1996-97 predicted, and have been found to be true, that prices would remain low, with producer profitability levels slim.
Finally, and of current long-term concern, beef as a product continues to face staunch and growing competition from poultry and other meat products. By the year 2005, Australia will, for the first time, be estimated to consume more chicken produce as a nation than beef. That is a significant fact and one that the red meat industry unquestionably must come to terms with. Put simply, they are losing market share.
Indeed, the determination of the Minister for Primary Industries and Energy, John Anderson, and this government to provide legislative framework encompassed within this bill will create new company structures and operational arrangements for the Australian red meat and livestock industry and advance the industry towards managing its own affairs. It is issues like the explosion in growth in poultry consumption that in one small but significant way highlights the need to press on and deliver these reforms.
The consumption level of poultry and white meat is escalating. Last year each Australian consumed an estimated 28 kilograms of chicken, up from 25 kilograms per person in 1993. Leading industry figures confirmed this rapid rate of growth in chicken consumption, pointing out an 11 per cent rise over the past four years. Around 350 million chickens are now consumed annually in Australia.
Just as significantly, North and South-East Asian nations are similarly experiencing rapid growth and enthusiasm for poultry products, with demand outstripping domestic supply. The effective impact on such markets recognised for their high consumption of Australian beef will therefore need to be carefully assessed. The changing face of the consumer market for meat further vindicates my passionate fight to sustain the Australian chicken industry's profitability, its sustainability and its prospects for export growth.
The feared impact of possible imported cooked chicken meat products from Thailand, Denmark and the United States that inadvertently may introduce virulent exotic diseases to our local poultry sector, along with our native fauna, is a risk I have repeatedly mentioned, and I hope the science of the matter may hopefully vindicate that as being a risk too great to accept. What we do not need in Australia is a poultry version of the mad cow disease, destroying consumer confidence on a domestic market and removing export opportunities from a clean green food bowl to Asia.
I understand Minister Anderson will be making an announcement pertaining to the final scientific results of independent testing and reassessment, which he ordered to be undertaken back in January this year, in the very near future. Like the rest of the Hunter's chicken industry—including all broiler growers, workers, consumers and the broader public—I await with bated breath the outcomes of these final scientific results.
My fight and the local chicken industry's fight to get the science right is about to reach its nadir. On reflecting on the state of the beef industry, the tag still very much being applied to the sector by so many players is that the industry remains in some sort of crisis. Nevertheless, there is still no doubting the beef industry's overall significance to both the national economic make-up and the regional economy of the Hunter. Australia, of course, remains the world's largest beef exporter, with more than 60 per cent of local production going offshore. In beef and veal sales alone, these exports netted $2.4 billion in 1995-96 and an estimated $2.1 billion in 1996-97. As a single agricultural export earner, red meat and livestock rank third after wheat and wool.
A most significant feature of the changing face of the Australian beef industry is the spectacular growth of live cattle exports against an economic environment affected by drought and low prices. In 1991, as a nation, we exported 90,000 head of live cattle. Last year that figure was half a million, representing 10 per cent of total exports. Despite the recent flood of American beef on the world markets, spurred by booming US production levels that between 1993 and 1995 increased by some 950,000 tonnes, our exports as a percentage of total national beef production have actually increased in the process—from 40 per cent of total local beef production to, within the past four years, well over 50 per cent.
The reform agenda within this legislation will, I believe, very much assist the meat industry in Australia move towards self-regulation, develop more free market operations and more strategic alliances, deliver more savings in changing the structures and levy funded functions, and hopefully deliver more competitive advantages that translate into greater exports, a greater share of the world market and a greater net return on investment.
For the beef sector in the Hunter, the legislative reform agenda will similarly have an important overriding impact, but it is important to reflect that the state of the domestic industry within greater New South Wales, and indeed the Hunter, has changed dramatically. Far removed from the sprawling cattle stations in north Australia, on my own patch within the lower Hunter small cattle properties carrying a relatively small number of cattle are very much the norm. Whilst New South Wales has 27 per cent of the nation's total producers, it presently carries only 19 per cent of the national herd with many producers running less than 300 head. The state of the Hunter beef sector reflects that fact, with many producers running such holdings and hence facing the fuller brunt of cost pressures.
As a regular attendee of the New South Wales Cattlemen's Council Gloucester branch meetings, and with continued contact through the saleyards with people such as Gloucester based Jim Henderson and Peter Green, from the Maitland saleyards John Lidbury and up at the Dungog saleyards, Paddy Dillon, I always try to keep abreast of the industry's fluctuating fortunes. Recently I had discussions with Rear Admiral Peter Sinclair, the former Governor of New South Wales, about his local holding of numerous head of cattle on his property in the Tea Gardens-Hawks Nest area, which is an example of the operative local growers across the Hunter. Our discussion focused on the investment required to establish and maintain a prime beef property and the narrow returns that come from the low sale prices.
It is important for producers to know and to understand that the establishment of the red meat service delivery company to replace the statutory trifecta of the Australian Meat and Livestock Corporation, the Meat Industry Council and the Meat Research Corporation will, despite some admitted apprehension by sectors of the industry, help drive industry development. It will help drive competitiveness and innovation of the industry into the future. Its impact on both small and larger growers alike will, nevertheless, be significant. It is a point that has been reinforced within the red meat industry sector proper. As Rick Wright of the New South Wales Farmers Federation quite correctly stated in his response to Minister Anderson's recent announcement of the make-up of the board of the new red meat organisation:
Traditionally we have looked to bodies such as the AMLC to make decisions for us, then we have blamed those bodies when the industry experiences downturns.
Now organisations such as the Cattle Council and the Sheepmeat Council must take responsibility for setting broad industry directions and policy which will then be implemented by the new red meat organisation.
Innovation for the beef sector, however, must go and is going beyond these legislated changes solely intended to provide producers, processors and exporters with more ownership and, as a consequence, accountability for their own industry. It is also aimed at taking further regulatory brakes of government off the meat industry.
Traditionally, and unbeknown to many, the beef sector has been the least regulated at the federal level of all Australia's major agriculture industries. An example of that new innovation is reflected in the case of Gloucester Gourmet Foods Co-operative Ltd, trading by the name of Barrington Beef. Gloucester Gourmet Foods was established as a concept in June last year following a beef crisis meeting held in Stroud with Hunter beef growers. As a cooperative, it was formed in April 1997. Gloucester Gourmet Foods specially selects stock from 30 local Gloucester producers which are then slaughtered at the Frederickton abattoir near Kempsey. Following along the chain, Darrel's Gourmet Butchery in Gloucester undertakes boning and packaging to ensure effective quality control.
The outcome to date has been the successful marketing of Barrington beef as gourmet quality prime beef exemplifying the character traits that customers are looking for—traits of high consistent quality, professionally pre-packaged and tailor made to the customer's own desire throughout the Sydney, Central Coast and Greater Hunter regions. Perhaps our very own parliamentary dining room should put on the menu what is arguably the very best beef available for all of our colleagues to try. Barrington Beef is driven by Gloucester residents, the chairman being David Lawrie and the financial director, Colin Ware.
This concept has captured the imagination and notice of many people including Minister Anderson during his visit to Gloucester in September, as well as the newly elected Parliamentary Secretary to the Minister for Primary Industries, Senator Troeth, and respected regionally based Senator Bill Heffernan, during their meeting with the cooperative in August. More to the point, Barrington Beef is taking an innovative step towards brand name marketing of quality local beef from the Gloucester district in the Hunter which is antibiotic free, chemical residue free, hormone growth promotants free and pesticide residue free.
The Barrington Beef product is delivered in bulk quantity direct to the customer's door, cut the way the customer likes it, is suitably priced and prepared either for the freezer or the dining table. Selected niche marketing of Barrington beef specifically to the north shore Sydney market has already reaped, in value added terms, around $100,000 in fresh cash flow for the Gloucester community.
Further, produce heading the way of Gloucester Gourmet Foods, whilst it has only half the beef producers at present under its banner, is likely to include boergoat and rabbit farming. As I am led to believe, the medium-term future for the cooperative is to seek a possible shopfront retail outlet on Sydney's north shore to further promote the product and carry the organisation's growth onwards and upwards in exposure and profitability.
However, my general concerns within the local beef sector are based very much on the continued difficulties that local growers have to go through to make a substantial return at the farm gate. I think that what we need to address is the vertical integration of the beef industry here in Australia. From the time that the beef is bought at the sale yards, goes through the producer, goes through the distribution company, gets exported and ends up on someone's dinner plate overseas, there is a substantial price change, but that price change is not reflected back through to our local beef producers. Indeed, our producers are now getting, over the last three or four years, the lowest price they have ever achieved for some of the best beef that they have ever produced.
It has been said to me that one of the reasons for this is perhaps collusive buying at the markets. There is also the fact that our processors are in fact overseas owned. The meat goes through to the abattoirs which are overseas owned, and it is prepared and packaged for distribution overseas by overseas companies who run it all at very little to no profit, and indeed in some cases at a loss. That beef is then shipped overseas to another company which is in the same chain at, yet again, a loss. Then it is on-sold again to a distributor at a loss.
That seems to avoid a lot of the anti-dumping regulations for cheap beef prices, and it escapes any controls that way, but amazingly when it goes that one step before it hits the final retail sales there is a massive price jump which sees beef which goes from, roughly, $2 to $2.50 per kilogram dead weight here in Australia to $20 to $25 a kilogram in some of the Asian markets. That is not considered to be fair and equitable and it is something which needs to be addressed.
A key element in the very successful vertical integration from the farm gate to overseas dinner plates relies on effective and efficient management of our waterfront. The member for Kalgoorlie (Mr Campbell) made claims in this House yesterday, when debating this bill, that the waterfront is apparently not a problem. It may not be a problem for him and it may not be a problem for the live export market that he spoke about, but when it comes to refrigerated containers going out of Australia full of beef it is a very big problem.
Rather than getting hairy chested about all of the rhetoric on the waterfront, let us stick to the clear facts. According to the Bureau of Transport and Communications Economics, as my colleague the member for Parkes (Mr Cobb) recently outlined to the House, the world waterfront productivity benchmark is 25 crane lifts per hour. Yet our five main ports in Australia average just 17.4. In Sydney, the rate has been monitored and assessed to be as low as 14 per hour, whereas the port of Auckland averages 24.
When you think of frozen beef exports, this substantially adds to the bottom line cost. Australia contributes but two per cent to the world's sea trade, yet now our local waterfront contributes to 24 per cent of the world's waterfront disputations. Classical disparities in the system remain, such as that it is cheaper to ship from Los Angeles to Indonesia than it is from Sydney to Indonesia. To continue the export drive for our beef, we need to remain competitive, but the drive down in price should not, and must not, be at the farm gate. We need to ensure that we have the most competitive transportation costs and the most competitive processing costs—to match our spectacularly low priced beef—to maintain our market share.