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TAS Country : February 3rd 2011
Friday, February 4, 2011 Tasmanian Country 7 Opinion Beef debate shrouded in doubt 'One report prepared by the ACCC for the federal primary industry minister in 2007 is nothing short of a disgrace' CHEWS theFAT David Byard HOT TOPIC: Coles is getting a roasting along with the -- HGP-free -- beef. A GREAT deal has been said in the media from a range of commentators regarding Coles' decision to ban the use of hormonal growth promotants in the meat they sell. One of the more interesting articles was a piece in The Sunday Age on January 23, entitled ''Coles roasted over campaign that could gut the beef industry''. The article said the Coles' campaign had created a monster that could damage Australia's $7.6 billion beef industry and cripple some producers. In the article, Meat and Livestock Australia declares on behalf of 47,000 meat producers that Coles' marketing strategy could frighten consumers into thinking that beef raised with HGPs is unsafe despite years of scientific testing to the contrary. It was a fascinating read given MLA's charter is research and development and marketing, a point they often make when for whatever reason they do not want to comment on meat issues. I have pointed out before that MLA has refused to give evidence to the ACCC and senate hearings. Australia's main consumer group Choice also weighed into the debate saying that clever marketing could jeopardise Australia's beef industry. This issue raises some pertinent questions including why Tasmania hasn't taken advantage of the situation given we banned the use of HGPs in 2000. As farmers, we need to be asking where industry, industry bodies, the State Government, government departments and anyone else who purports to help value-add to Tasmania's rural produce have been since 2000. Clearly they have been asleep at the wheel. We also need to ask where these people were when the ACCC and the Senate delivered their findings in relation to the supermarket duopoly. Perhaps the large supermarkets think that they are beyond the law. If this is correct, they have ample justification for this type of thinking. While MLA and others have given Coles a roasting over HGPs, they have been conspicuous by their absence when reports from the ACCC and the Senate have been published -- reports full of untruths and inaccuracies. These reports now grace the shelves of the parliamentary library and one would suspect that when the people formulating the laws use these documents as reference material they might come to the wrong conclusions. One report prepared by the ACCC for the federal primary industry minister in 2007 is nothing short of a disgrace. The following year, the ACCC conducted a formal inquiry into the grocery industry and it was not much better. The McGauran report was written after the then primary industry minister wrote to the ACCC expressing his concerns that the price of livestock was at an all time low due to drought and meat at the check-out was at record highs. The ACCC found that getting the meat from the paddock to the consumers involved a long and complex supply chain which meant that there would not be an immediate relationship between the price of raw products or the meat in the retail shop. It also found the cost of livestock was only one component of the total cost and represented a small proportion of the final price of packaged meat. Coles actually suggested that the producer gets 53 per cent of the final package of meat while MLA suggests that it is 30 per cent. Are either of these figures right? It is stated that 14 per cent goes to kill and bone. So after rebates, could it be possible that this figure is a single digit percentage after hide and offal rebates? There seems to be some major contradictions at play. Coles has submitted that it has a three per cent margin on beef and now one of the two supermarkets is offering a 20 per cent discount on beef. How is this possible? During the official ACCC inquiry in 2008, Coles declared that it was paying $4.60/kg for carcass beef and it got a 60 per cent yield of meat out of a carcass. Is it possible Coles insists that the people boning their beef get a 70 per cent return or 70kg of meat and 30kg of fat and bone from a 100kg carcass? And there has never been any mention of how much profit is made out of boxed beef. A rump selling at wholesale at $4.50/kg may end up on a supermarket shelf at $25/kg. These facts are not very difficult to get hold of given the resources the ACCC has at its disposal. You don't have to employ a rocket scientist to collect simple figures and have basic questions answered including how much the producer gets paid, how much it costs to kill and bone and what the value of rebates, hides and offal is. People slice and package case-ready meat on a contract basis for the major supermarkets and if someone gathered all these figures together and determined the total value of the beast it would be pretty easy to establish how fictitious the figures presented to the ACCC have been. What is even more scary is that the ACCC has been told about inaccuracies and it has done nothing about it. Why? Is there a conflict of interest? Milk has also been in the news lately and information provided to the grocery inquiry in 2008 makes interesting reading. Back then, Coles declared the payment breakdown from a 2 litre bottle of milk was 34 per cent for the producer, 43 per cent for the processor and 23 per cent for the supermarket. Now we have the supermarkets saying they have dropped the price by 20 per cent. The supermarkets say they will not reduce the price to the producer and I believe them. But I suspect processors will drop the prices they pay producers. This debate is home to many discrepancies and a review of the whole process is long overdue. ATTENTION GROWERS & PRODUCERS DUE TO INCREASED DEMAND WE REQUIRE MORE LOCAL FRESH PRODUCE. Large or small quantities Call Trudy at ISLAND MARKETS between 10-2pm Wed to Sun 6273 7918 2061849-110108 SWIFT AUSTRALIA All types of Livestock required for processing at our Longford & Devonport Plants For a competative price ring our Livestock Buyers today 2054551-110121 Swift Australia Tasmanian Livestock Team Tom Archer Livestock Manager M 0419 310 701 Allan Boyce Livestock Buyer M 0419 310 698 Mathew Bosworth Livestock Buyer M 0438 912 161 Rohan Hadley Livestock Buyer M 0437 228 536 Jacob Last Livestock Buyer M 0458 921 397 Swift would like to thank producers for their continued support. 2056928-110114
January 27th 2011
February 10th 2011