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Senate Inquiry into Red Meat Processing

02 April 2015

AUSTRALIA - A senate inquiry in Australia is to focus on the effect of market consolidation on the red meat processing sector.

The senate will look into the potential misuse of power and returns to producers because of the consolidation.

Rockhampton-based Senator Matt Canavan said: “We will examine the potential for misuse of market power through buyer collusion and the resultant impact on producer returns.

“Profitability for producers is determined by the price they receive and – despite strong international demand and good prices for Australian red meat – producer returns depend on healthy competition among buyers here.”

Member for Capricornia Michelle Landry said the beef sector was one of the most important agriculture industries in Central Queensland.

“Beef producers have been struggling in recent years to achieve good prices. So, the beef sector will most likely welcome this inquiry with open arms,” Ms Landry said.

Senator Canavan said the inquiry will examine the impact of the red-meat processor consolidation on market competition, creation of regional monopolies and returns to farm gate.

“It will also consider the existing selling structures and processes at saleyards, particularly pre- and post-sale weighing, as well as direct sales and online auctions, and whether they remain relevant, plus the regulatory environment covering livestock, livestock agents, buyers and meat processors.”

Senator Canavan said the inquiry had just been established this week and no decision had been made on when and where hearings would be held.

“I will be pushing for a hearing in Rockhampton,” he said.

“This is the beef capital of Australia and any Senate inquiry examining red meat processing and profitability should certainly convene a hearing in Rocky.”

“The inquiry must certainly hold sittings in Rockhampton, the nation’s beef capital, which is home to major international meat exporters and livestock trading,” Ms Landry said.

“Australia is said to be one of the world’s most efficient producers of cattle. But that may not necessarily equate a fair price for farmers for their product on the ground,” she said.

“It will be important to hear from all sides of the industry here, including the perspective of the meat processing companies, which are also big employers.”

Senator Canavan said the inquiry was due to report its findings by 12 August and submissions should be lodged by 15 May.

Along with Senator Canavan, other Senators participating in the inquiry include Barry O’Sullivan (based in Toowoomba), John Williams from New South Wales and Bridget McKenzie from Victoria. It will be conducted by the Rural and Regional Affairs and Transport References Committee.

TheCattleSite News Desk

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