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Hundreds lose jobs with meatworks shutdown. -

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ELEANOR HALL: Meat processors say high sheep prices are partly to blame for the closure of an
abattoir in the New South Wales town of Young. Three hundred workers were stood down when
Burrangong Meat Processors was placed into receivership yesterday.

They're now waiting to see if there is any hope they'll keep their jobs or receive redundancy
entitlements.

Bronwyn Herbert has our report.

BRONWYN HERBERT: Burrangong Meat Processors has been operating in the New South Wales town of Young
for more than 20 years. But yesterday the processor went into receivership leaving 310 workers
without a job.

The drought and high prices for stock are believed to be major factors.

Kate Joseph from the Sheepmeat Council says it's not the end for meat processing but acknowledges
that high prices paid for certain cuts of meat do have an impact.

KATE JOSEPH: I think there is still money in processing, it's just that the tight prices and short
supply is just putting a fair bit of pressure and it's going to cause a bit of rationalisation in
the industry.

BRONWYN HERBERT: Kate Joseph is also a prime lamb producer from Portland in Victoria. She says
she's seen a huge rise in mutton prices paid at the farm gate.

KATE JOSEPH: I sold my cull ewes, so they're ewes that I've been using for breeding and are no
longer able to be used in that situation and I averaged $86.30 for those ewes which is a very high
price. In a normal year probably the price I would expect would be around $40-50.

BRONWYN HERBERT: At last count, the Australian sheep flock was just over 70 million. That's down
from a high of 180 million in the 1970s.

The sheep industry is changing and meat processor Roger Fletcher says they need to change with the
times too. He says the abattoir in Young had a unique business model.

ROGER FLETCHER: You know, they are processing for other customers and that puts, when there is a
little shortage of stock and a strain on them it would put a bigger strain on the company. They are
one of the only multi-species plants left technically I suppose in Australia in a sense where they
do sheep, cattle, pigs and goats, and I think that's, you know, a difficult situation.

BRONWYN HERBERT: Burrangong meatworks was the biggest employer in Young and also the workplace for
many refugees from Afghanistan who had moved to the south western town specifically for the work.

Roger Fletcher is the principal of meat processor Fletcher International, one of Australia's
largest meat processors and based in Dubbo in New South Wales. He says Burrangong meatworks has its
own set of challenges.

ROGER FLETCHER: You know, they've been there, they've been going for quite a few years. But we've
got a, a very difficult time in beef processing and it's a difficult time in sheep processing and
you know we've made some changes of ours, cut our production back so we could manage it sensible
and that's what we're doing and a lot of other plants have done that. Outside of that it sometimes
catches some of them on the side.

BRONWYN HERBERT: John Berry is the director of Swift Australia, a division of the world's largest
meat company JBS based in Brazil.

JOHN BERRY: It's not a constant margin business, you know, when you do money in this business you
can do it very, very quickly and in large volumes. It's cyclical but at the same time it's exciting
and challenging business and it's really a key business in terms of the agricultural and export
industry in this country.

BRONWYN HERBERT: John Berry says the Australian meat market is going through a period of
restructure.

JOHN BERRY: In terms of the supply side here in Australia, currently we're facing very tight supply
conditions both in northern Australia due to seasonal conditions and livestock availability. It's
also compounded by the number of live cattle which have been leaving northern Australia over the
last number of years.

And in southern Australia, this time of the year usually things are going gangbusters but we've
seen a tightening in numbers and it's not a good outlook down there, especially with sheep numbers
which have declined dramatically over recent years.

BRONWYN HERBERT: Swift Australia recently purchased an abattoir business in King Island that had
gone belly up, with the financial assistance of the Tasmanian Government. John Berry says he can't
comment directly on the closure of the abattoir in Young but says it must be acknowledged that meat
processing is a cyclical business.

ELEANOR HALL: Bronwyn Herbert with our report.