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Thursday, 24 February 1977


Mr FRY (Fraser) -I think there is no question that for once the Government and the Opposition are in agreement. The beef industry is m a terrible mess. We would not be completely in agreement about why it is in a mess, of course, but I am sure we are all in agreement on many of the underlying problems of the beef industry. The beef industry is in a mess because of inherent difficulties. It has long term problems, problems connected with economic selfsufficiency in other countries such as Japan which protect their farming communities, the same as we do here, and subsidise them. The beef industry is also in a terrible mess because it has two great liabilities. I refer of course to the two great political liabilities that the beef industry has in this Parliament. I mention firstly the Prime Minister (Mr Malcolm Fraser) who went to a dinner in America and was invited to talk about the beef industry. He did not initiate the discussion. Leaders opposite talk about the quantity of exports involved but do not know the figures. My colleague the honourable member for Blaxland (Mr Keating) pointed this fact out very well. This is gross incompetency on behalf of the leaders of this country who pretend to have the beef industry at heart but really are not well briefed on it. They are more concerned with other matters of direct interest to them and perform very badly in looking after the interests of the beef industry whenever they go overseas.

The other big liability is the Minister for Primary Industry (Mr Sinclair). I think the great liability at the moment is the Minister's procrastination over a wide range of measures which could help the beef industry and which have been requested by a large number of organisations within the industry. A whole range of matters is involved but probably the matter which warrants the most urgent consideration is the failure to establish the Australian meat and livestock corporation. This proposal has been under consideration for some time. We get all sorts of excuses and delays, but nothing happens. At this time a whole range of rural publications and comments in the rural media is criticising the Minister. Members or organisations such as Federal and State livestock producers organisations, the Woolgrowers' and Graziers' Council, the Australian National Cattlemen's Council, the Australian Wool and Meat Producers Federation and the Australian Farmers Federation are all calling for a change in the structure of the Australian Meat Board. What has the Minister done? He has done nothing.

The Minister has not taken any action regarding the promise to which he gave great prominence in the policy speech. I refer to the establishment of a national rural bank. All sorts of problems are associated with the establishment of a national rural bank. When it is established it will probably be seen to be in the form of some sort of window dressing without any real substance. He made the promise; he has not produced the goods, in the same way as he made the promise about restructuring the Australian Meat Corporation. He thought that devaluation would get him off the hook in relation to the beef industry. It may have, for a few weeks. Now the chickens have come home to roost. It is quite apparent that he has not been got off the hook. The huge differences between the returns and the cost of producing beef have not been offset by devaluation. Prices are still low. Producers continue to be exploited by meat processors. Devaluation has been merely a temporary expedient. It has done nothing to solve the long term problems of the industry. I quote from an article by Mr Cameron, the Executive Officer of the Australian National Cattlemen's Council:

Low cattle prices throughout 1976-77, coupled with a substantial increase in farm costs, will result in beef dominant producers in the high rainfall zone receiving average net cash incomes of $3650 or the equivalent of $70 per week. This in turn is forcing producers to continue to offer cattle for sale that are either unfinished or could be retained until the market improved.

That is a measure of the desperate straits which the beef industry is in. Last year when I spoke on this matter I tabled a document showing the excessive profits which all meat exporters were making. I understand that this trend is continuing. I substantiated my charges by showing the profits made by F. J. Walker Ltd, Tancred Bros Pty Ltd- of which the honourable member for Macarthur (Mr Baume) is a director; and the meat producers in Macarthur will be aware of his division of interests between Tancred Bros and the producers-Metropolitan Meat Co. Pty Ltd, J. C. Hutton Pty Ltd and T. A. Fields Pty Ltd. The figures are here. They have been well circulated. They have been reinforced by a letter which I received a few days ago from a producer at Hughenden, Queensland. This lady, who is an official of the local branch of the Cattlemen's Union of Australia, paints a very nice picture of the way in which the local meatworks, which produces a lot of meat, is manipulating the market in Townsville: the practice of meatworks owning properties running thousands of head of cattle and their practice of using the fat and boner stock from these properties to flood the market at a time when most forest country cattle are coming into the auction yard could be transgressing some part of the Restrictive Trade Practices Act.

It is good when one section of the industry practises restrictive trade agreements which manipulate the market to the disadvantage of the producer. She also wrote about a Townsville works, which I understand is mainly owned by F. J. Walker:

.   . one Townsville works contemplates killing 2000 head per week from its properties for 2 months this season and will not be buying outside cattle.

It is a wonderful situation in one of the largest cattle growing areas in Australia. The lady further wrote: . . in most areas cattle can only be turned off in reasonable condition while the grass is still growing and hasn't gone to seed. Pan of this time, the early Wet, boggy conditions make it impossible either to muster or to transport cattle to the works. Hence on the more remote properties cattle are mustered after the Wet- end March- and reach the market in late April to early July, which is when the exporting companies have decided to move their own cattle. Naturally prices are depressed.

This is a blatant case of a meatworks manipulating the market to its own advantage and to the disadvantage of the producer. I have no doubt that this situation is being duplicated in many meatworks throughout the country. If one looks at who owns the meatworks and the fingers that they have in the pie at the producing end, the number of cattle they own and the number of acres they control, one sees that they are in a very strong position to manipulate the market to the disadvantage of the producer. This lady to whom I referred also wrote about the big cattle property Stanbroke, which is owned by Thomas Borthwick and Sons Ltd, the Australian Mutual Provident Society and Sir Sidney Kidman. These are the big properties which manipulate the market. What chance has a small producer?

All the information we have about the industry is that it is in a mess. On the other side, we have the very sorry picture of the Government doing nothing about it. The Minister for Primary Industry has let the industry down badly because he has a conflict of interest. Despite the fact that he represents a country seat, his background is very much Establishment and part of the commercial world. He certainly has a conflict of interest in trying to look after the interests of the producer and at the same time wanting to protect the interests of the meat processors who continue to make high profits at the expense of the producers. It is quite obvious that these people have been badly let down. I think the future of the meat industry is in many ways tied up with the future of the Minister for Primary Industry. He is in a dilemma. He has pressure from both sides. He does not know which way to jump. If he does not jump somewhere soon he will finish in the middle- he will finish on the floor- because the rural people are fed up with his procrastination and his failure to honour his promises. There is a wide range of things which he can do to assist primary industries, particularly the beef producers. He has done nothing. The people have just about had enough.







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