Counterpoint No 346 –Australian Cattle Prices Reach the Bottom of the Global Ladder.
Published: 19 Nov 2008
News ID: 10905
News ID: 10905
By John Cater
There's an old saying - 'It's hard to envisage the draining of a swamp when you are up to your arse in crocodiles'. In Australia, the swamp has disappeared and we are now standing in a dust storm, incapable of seeing what is happening to us. The enormity of the sheep number decline is beginning to sink in but the cattle disaster is taking longer.
We are consistently told that we trade in a Global Market but we are never given comparisons of producer prices around the Globe.
I received an e-mail from a friend in Ireland who had been reading the Irish Farmers Journal ' one of the best in the World. He said that the weekly World beef price table had him puzzled. In Euros the dressed weight prices were as follows - UK 3.56, Italy 3.46, Netherlands 3.35, Germany 3.30, France 3.19, Uruguay 2.51, US 2.46, Brazil 1.83, Australia 1.57 and the politically price capped Argentina on 1.32.
He finished with - 'I'm not sure what's going on but it seems odd. How is MSA perceived among beef farmers? It has been held up as a model here.' Odd it is. Australia sits on the Global Beef Price Ladder just above the bankrupt Argentina and falling fast, despite our low dollar.
We have been told for years that we lead the World with MSA and NLIS. We have continually told in the media that our cattle prices are good. After a 40 cent price drop (from a low base) on a falling dollar, in a month, I am not amused.
Why, when we are paying the highest levies and using the most expensive QA and Trace-back systems in the World are we getting the lowest true prices in the developed world?
Is our 'Best beef in the World', really the worst in the developed world? Must we face the fact that we produce a third world product? Is it possible that we have been led by idiots who can't see beyond their ivory tower?
We are being rorted by our supermarket duopoly -- since 2000 when we moved from three to two supermarket chains, while the sale yard price of cattle has remained static, the combined retail/wholesale margin has exploded by 56%. Both producers and consumers are being ripped off. Producers now receive 28% of the consumer dollar and falling whilst the USA, UK and NZ receive between 45% and 49%.
There is now no viable export abattoir in two thirds of our Continent, west of a line from Adelaide to Townsville; - there were once eight. Western Australians are trucking cattle over the Nullabor, or just moving out of the industry. It is a terrible indictment on industry and Ministerial leadership.
We are leading the world into vegetarianism, as our cattlemen are squeezed out of business by the highest regulatory costs, the toughest retail duopoly, one of the highest interest rates in the World, on top of trying to produce in one of the toughest environments.
What to do? We must change direction ' fast; - cut our costs. Forget about complicated systems like NLIS, MSA, Breed plan and our expensive levy. They have taken us down the path to oblivion.
There's an old saying - 'It's hard to envisage the draining of a swamp when you are up to your arse in crocodiles'. In Australia, the swamp has disappeared and we are now standing in a dust storm, incapable of seeing what is happening to us. The enormity of the sheep number decline is beginning to sink in but the cattle disaster is taking longer.
We are consistently told that we trade in a Global Market but we are never given comparisons of producer prices around the Globe.
I received an e-mail from a friend in Ireland who had been reading the Irish Farmers Journal ' one of the best in the World. He said that the weekly World beef price table had him puzzled. In Euros the dressed weight prices were as follows - UK 3.56, Italy 3.46, Netherlands 3.35, Germany 3.30, France 3.19, Uruguay 2.51, US 2.46, Brazil 1.83, Australia 1.57 and the politically price capped Argentina on 1.32.
He finished with - 'I'm not sure what's going on but it seems odd. How is MSA perceived among beef farmers? It has been held up as a model here.' Odd it is. Australia sits on the Global Beef Price Ladder just above the bankrupt Argentina and falling fast, despite our low dollar.
We have been told for years that we lead the World with MSA and NLIS. We have continually told in the media that our cattle prices are good. After a 40 cent price drop (from a low base) on a falling dollar, in a month, I am not amused.
Why, when we are paying the highest levies and using the most expensive QA and Trace-back systems in the World are we getting the lowest true prices in the developed world?
Is our 'Best beef in the World', really the worst in the developed world? Must we face the fact that we produce a third world product? Is it possible that we have been led by idiots who can't see beyond their ivory tower?
We are being rorted by our supermarket duopoly -- since 2000 when we moved from three to two supermarket chains, while the sale yard price of cattle has remained static, the combined retail/wholesale margin has exploded by 56%. Both producers and consumers are being ripped off. Producers now receive 28% of the consumer dollar and falling whilst the USA, UK and NZ receive between 45% and 49%.
There is now no viable export abattoir in two thirds of our Continent, west of a line from Adelaide to Townsville; - there were once eight. Western Australians are trucking cattle over the Nullabor, or just moving out of the industry. It is a terrible indictment on industry and Ministerial leadership.
We are leading the world into vegetarianism, as our cattlemen are squeezed out of business by the highest regulatory costs, the toughest retail duopoly, one of the highest interest rates in the World, on top of trying to produce in one of the toughest environments.
What to do? We must change direction ' fast; - cut our costs. Forget about complicated systems like NLIS, MSA, Breed plan and our expensive levy. They have taken us down the path to oblivion.
