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Australian trails US and Argentina in meatworks productivity

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B ruce Lloyd M edia

Deputy Leader, National Party of Australia

Shadow Minister for Primary Industry

Ph: 06/2774193



Abattoir work practices, lack of productivity and Government charges are reducing farmers' incomes and meat exports, and costing jobs, according to National Party Deputy Leader and Shadow Minister for Primary Industry, Bruce Lloyd.

Mr Lloyd, who was opening the British Breeds Ram Sale at the Royal Melbourne Show, said Australian farmers had been carrying an inefficient killing and processing sector for years, but could no longer afford this luxury.

"Fat lamb and beef producers have known for years that Australian meatworks, particularly in Victoria, have been adding more cost than value to their end product. Now at least two recent reports, one with unionists involved, have highlighted Australia's lack

of competitiveness beyond the farm gate.

"The most recent report, commissioned by the Meat Research Corporation, shows it costs 49.4 cents a kg to kill and dress a beef animal in Australia, 26.1 cents in Argentina and 16.5 cents in the US.

The major problem for Australia is the tally system which

actually dates back to the days when there was little automation and workers had to undertake many more physical tasks and it was considered necessary to limit the amount of stock that could be handled per day.

The report found that the Tally system limits the introduction of automation as the employment award dictates staffing at each position, whereas both the US and Argentina can re-assign staff to new positions at management discretion.

This has resulted in Australia falling behind in automation and therefore productivity.

For example the line speed in the best Australian abattoir for beef was 100 per hour whereas the Argentina abattoir ran at 160 and the US at 250.

Recent reforms in New Zealand have reduced their killing costs to about the same as the US. However, the Fortex Group is

creating even tougher competition in its two NZ abattoirs by operating them 22 hours a day, six days a week and undertaking maintenance on Sundays.

Fortex is expected to export product worth $300 million from processing more than three million lambs and about 100,000 deer.

"Unless Australia catches up we are in danger of losing market share. Argentina is now close to being declared free of foot and mouth disease which will open up more markets for it."


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Mr Lloyd said Coalition policies of removing payroll tax, wholesale sales tax and fuel excise will bring significant savings to the meat industry, but its industrial relations policies will be of greater significance to the processing

industry by ending old and out-dated work practices.

He said for far too long too many abattoir owners in Victoria had given into union demands and in order to pay for them have been forced to pay less for their stock to remain competitive


"The report says this has resulted in the Australian farmer receiving an average of 340.5 cents a kg when the beast is sold to the meatworks while his American equivalent gets 465.8 cents a kg.

"It is time fat lamb and beef producers demanded a halt," Mr Lloyd said. 3Γ "Producers can no longer afford to keep an inefficient sector and they need more of the final price to be able to survive."

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