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Monday, 26 March 2001
Page: 22913


Senator FERRIS (1:01 PM) —The legislation before us this afternoon provides for the amalgamation of the Australian Pork Corporation and the Pig Research and Development Corporation into a single, industry owned body. The company, to be known as Australian Pork Ltd, will undertake both industry marketing and promotion as well as research and development functions.

The Australian pork industry has, as many of us here know, been operating in pretty volatile circumstances over the past couple of years. It was only three years ago that the industry strongly believed that without tariff protection it faced oblivion in this country. However, the then minister, Mr John Anderson, believed that success could only come to this industry as a result of improving competitiveness and moving to an export focus. In November 1997 he launched a $10 million development package for the industry to assist in achieving the export focus the industry so badly needed. In June 1998 we provided an additional $8 million in investment grants to upgrade specialist abattoirs so that they met export standards. One of those abattoirs is sited in Murray Bridge in my home state of South Australia. I have been very closely associated with many of the industry issues that have come up over the last four or five years and I have seen some very strong growth in this industry in recent times. We are now looking at an industry that is worth $825 million a year.

I cannot let the opportunity pass without commending John Anderson for the very strong stand that he took in the face of significant and considerable opposition in relation to the pork industry three years ago. The figures on the growth and the value of this industry very clearly now vindicate that strong position he took. Over the last 12 months the Australian pork industry has in fact experienced a 73 per cent increase in exports. The industry is doing particularly well in Singapore now that Singapore is unable to import pork from Malaysia as a result of the disease outbreaks that have already been mentioned in this place today. That market alone is now worth over $90 million and accounts for 63 per cent of our total pork exports. The Australian pig industry itself employs between 3,000 and 3,500 people with an additional 3,000 people employed in the processing of pig meat and another 6,000 people employed in the smallgoods manufacturing area. The establishment of the Australian pork industry as a single entity, APL, will go a long way to preserving and in fact enhancing these jobs. I must say it is a far cry from the days of that very unfortunate campaign that the industry ran against this government in the 1998 election. I for one spoke very strongly to the industry against that campaign. I thought it was a very negative and personally offensive campaign and I am delighted to see that the industry now has a far more positive focus.

The pork industry is also exporting into Japan: 17 per cent of our exports now go to Japan. However, while ABARE forecasts Asian demand for pig meat will remain strong in 2001-02, it noted during the recent Outlook Conference that the pork industry now is facing increasing competition in its main markets from the world's major pork suppliers and exporters; that is, Canada and the United States. However, the foot-and-mouth disease crisis that has now hit the Northern Hemisphere has the potential to greatly change the face of the Australian pork industry and in particular the way it accesses export markets. Already Australia has placed a ban on all imports from one of our biggest competitors, Denmark, and I have no doubt that further opportunities will arise on world markets for our industry if the United Kingdom is unable to access these very important export markets that they also have been supplying. So further opportunities may arise in those third markets as a result of the very unfortunate FMD crisis in Britain and Europe.

But strong competition has greatly intensified the need to restructure our pork industry. Moving towards an amalgamated industry structure with a very strong commercial focus emerged as the best way to ensure the continued growth of the industry. I am glad to say that the industry itself recognised this new focus and cooperated in preparing this legislation. In fact, delegates to the Pork Council's AGM last year voted unanimously to support a new structure. This legislation delivers exactly that: it replaces the Australian Pork Corporation and the Pig Research and Development Corporation with a single industry services body operating under the Corporations Law and known as Australian Pork Ltd. This new unified organisation will further increase our level of international competitiveness in pork products. The company will have a very strong commercial focus. It will be responsible for providing marketing services to undertake research and development projects in the industry's best interests, a very powerful combination in a commercial sense.

To me, one of the key benefits of this new company is that it will be able to combine industry policy and industry planning for a far greater level of industry efficiency. The board of APL will be required to include members with specialist skills, one of whom will be an independent director with a strong corporate base and strong corporate skills. All pork producers who are registered as statutory levy payers to the APL will be eligible for full voting rights in the new company. Importantly, levy payers will be able to vote on changes to levy rates and to participate in the election of directors to the board.

Another aspect of this legislation that is very pleasing to me is that the chair of APL will be required to brief the minister at least twice a year on the company's performance and on its research and development priorities. So the key element and effect of this legislation will be to deliver precisely what the pork industry has been asking for: a cost-effective industry body responsive to the demands of world competition and accountable to its shareholding members. The legislation will be a huge boost to our increasingly successful pork industry. What is even more pleasing to me is that the changes we seek to implement today come with an unprecedented level of agreement from the industry and, most importantly, from the 2,500 or so pork producers themselves.

I was very sorry to hear from Senator Woodley that the President of the Pork Council, Ron Pollard, has been unwell. I recall very clearly the courageous stand that Mr Pollard took in those dark days in the pork industry's crisis of 1997. He was a calm and rational voice at a time when a great deal of emotion was circulating in that industry. I look forward very much to attending the Pork Council's annual dinner tonight to hear of the deliberations that the annual conference has been making during the day today.