Program 1.9: Meat and livestock industry
The objectives of this program are to:
- assist primary producers to develop a more competitive, internationally focused and self-reliant meat and livestock industry
- maintain appropriate industry regulatory functions and statutory funding for research and development.
Review of performance
This review addresses the deliverables identified in the 2011–12 Portfolio Budget Statements. Table 10 summarises the extent to which we have met key performance indicators.
Responding to industry developments and issues
The government is increasing the marketing component of the pig slaughter levy following a request from the industry body, Australian Pork Limited (APL). The marketing component of the levy is being increased by a total of $0.90 per pig slaughtered from $1.35 to $2.25 in three tranches of $0.30 over four years. The first tranche took on 1 July 2012. APL will use the additional marketing income to contribute to increasing the overall levels of consumption of Australian pork products.
The department hosted a Japanese delegation to the annual Japan–Australia beef talks in Canberra in March 2012. Japan is Australia's largest beef export market and a stable and mature market. The talks are an opportunity for the two governments to discuss the ongoing supply of beef and trends in consumer preferences. The delegation visited a producer, an export abattoir and a feedlot near Albury–Wodonga as part of the talks.
Administering red meat quotas
We manage the arrangements for meat to be exported in-quota to the European Union (EU) and the United States. In 2011–12, the department issued 2443 certificates for beef and sheep meat to the European Union and 12 429 certificates for beef to the United States. The trend for shipping beef to the United States improved in the first half of 2012, while the trend for shipping beef and sheep meat to the European Union remained constant throughout the year.
Australia's quota for EU sheep meat and goat meat increased in 2012. The European Union added 400 tonnes to Australia's country-specific quota, increasing the total access amount to 19 186 tonnes a year. It also made available an extra 200 tonnes a year as a global quota, and Australia shipped 194 tonnes under this quota.
The cost of administering the quotas is fully recovered from meat exporters on a fee-per-kilogram basis. In 2012, the fees were increased from 0.002 cents per kilogram to 0.0026 cents per kilogram, to offset declining cost recovered revenue.
Family company leads the way in meat exports
Nolan Meats, an Australian, family-owned company with more than 45 years of experience in the industry, won the 2011 Queensland Exporter of the Year award and was selected as a recipient of a 2012 DAFF Australian Biosecurity Award for its major contribution to meat industry reform.
In 2007, the family-run meat processing company at Gympie, managed by Terry Nolan, started a meat export trial mirroring the United States Department of Agriculture's Hazard Inspection Model Project for meat inspection. A DAFF veterinarian worked at the plant with the company's own meat inspection staff to ensure that the processing performance criteria were met. In 2008, the company gained listing in the United States, meaning the product met the specific criteria necessary for export to America, and became the model for what later developed into the export certification reform initiative—the Australian Export Meat Inspection System (AEMIS).
AEMIS is an integrated set of controls specified and verified by government that ensures the safety, suitability and integrity of Australian meat and meat products destined for domestic and export markets. It provides trading partners with greater certainty regarding meat inspection and food safety verification compliance while at the same time giving businesses greater flexibility in how they manage their day-to-day operations. AEMIS involves the collection and assessment of a range of data, which is brought together as the Product Hygiene Index of an establishment.
Authorised officer Craig Hulley at work at Nolan Meats
Photo courtesy of Nolan Meats.
Review of the European Union high-quality beef quota scheme
An independent review into the efficiency and effectiveness of administrative arrangements for the EU high-quality beef quota was finalised in September 2011. The review concluded that the current arrangements required some modification to meet Australian beef exporters' requests for a fairer allocation process, particularly in relation to non-standard quota.
The modifications will be implemented to take effect for the 2012–13 quota year. Further information about the review process and the new administrative arrangements are available on our website.
Supporting research, development and marketing
Legislation allows declared industry-owned research and development corporations to receive industry levies and matching government contributions via statutory funding agreements (SFAs) with the Commonwealth.
We administer the SFAs between the Commonwealth and the four meat and livestock industry corporations:
- Meat and Livestock Australia (MLA)
- Australian Livestock Export Corporation Limited (LiveCorp)
- Australian Meat Processor Corporation (AMPC)
- Australian Pork Limited.
MLA is a producer-owned company, working in partnership with industry and government to undertake marketing, promotion, research and development to help achieve a profitable and sustainable red meat and livestock (cattle, sheep and goats) industry in Australia.
LiveCorp undertakes livestock export industry services to promote Australian livestock overseas, undertake industry research and provide services for the benefit of livestock exporters. The department is monitoring LiveCorp's review of its financial and strategic direction in response to the 2011 suspension of live exports to Indonesia.
AMPC was established to undertake industry services for the meat processing industry, including the promotion of Australian meat sales domestically and internationally, and industry research and development for the benefit of Australian meat processors.
The pig industry established APL to undertake marketing, promotion, research and development, strategic policy development and other activities for the benefit of pork producers and the Australian pig industry as a whole.
The current statutory funding agreements for APL and AMPC came into effect on 12 July 2011 and 9 February 2012 respectively. During 2011–12, we worked with MLA to progress a new SFA. These agreements incorporate enhanced governance to reflect expectations from government and industry that public monies are prudently managed and that service delivery standards continue to improve.
All four corporations met their statutory obligations in 2011–12.
Key performance indicators
|Key performance indicator||2011–12 target||Achievement|
|Meet with meat and livestock industry representative bodies to discuss policy issues||2 meetings||Met||Met||Met|
|Performance: DAFF attended three of the four Red Meat Advisory Council board meetings and met separately with the industry representative bodies during the year. DAFF has attended the Red Meat Advisory Council board meetings since the council was established in 1998 and meets industry representative bodies formally and informally each year.
DAFF reported this indicator as a 'deliverable' in 2009–10.
|Australia's international quota obligations are met||100%||Met||Met||Met|
|Performance: DAFF continues to allocate quotas and issue quota certificates in accordance with the Australian Meat and Livestock (Quotas) Regulations 2000 and the Australian Meat and Livestock Industry Regulations 1998. All certificates issued met EU and US requirements.|
|Red meat quota statistics are accurately and regularly processed||100%||Met||Met||Met|
|Performance: Quota statistics are published weekly on the DAFF website. Historical statistics on meat exports under quota since 1997 are also available on the website.|
|Provide the meat and livestock industry with regular feedback on quota matters||At least weekly||Met||Met||Met|
|Performance: DAFF provides regular feedback to industry—formally and informally—on quota matters via fax, email and/or telephone calls.
DAFF reported on performance as a 'deliverable' in 2009–10 and 2010–11.
|Attend annual Japan–Australia beef talks on supply and demand||1 meeting||Met||Met||Met|
|Performance: DAFF hosted the annual beef talks in March 2012.
The department reported on performance as a 'deliverable' in 2009–10 and 2010–11.
|Meet with Australian Pork Limited, Meat and Livestock Australia, Australian Meat Processor Corporation and Australian Livestock Export Corporation to discuss obligations under their agreements and relevant legislation||2 meetings||Met||Met||Met|
|Performance: DAFF met the organisations in compliance with their agreements and is satisfied that they have materially met their obligations under the funding agreements and relevant legislation. The department is also satisfied that these obligations were met in 2009–10 and 2010–11.|
|Levy payments made in accordance with statutory funding agreements||100%||Met||Met||Met|
|Performance: DAFF has regularly met this target. In 2011–12, all payments were made on time and in accordance with agreements.|
|Minister/parliamentary secretary and executive satisfied with the quality and timeliness of policy advice and support||High level of satisfaction achieved||Met||–||–|
|Performance: DAFF provided policy advice and support to the minister and parliamentary secretary. This advice has been received with a high level of satisfaction. This is a new indicator.|
Outlook for 2012–13
We will continue to liaise with industry representatives on issues of concern to the industry and government and to provide information on quota usage for the industry's benefit. We will prepare for the annual Japan–Australia beef talks, which are due to be held in Japan in April 2013.
New administrative arrangements recommended by the independent review of the EU high-quality beef quota will come into effect for the 2012–13 quota year. These modifications will help improve the efficiency and effectiveness of beef exporter requirements and the quota allocation process.
On 1 July 2012, the first of three tranches to raise the marketing component of the pig slaughter levy came into effect.