By Leon Gettler >>

CHRIS BALASZ, who runs Australian red meat company Provenir, is revolutionising Australian abattoirs.

The regulator, Prime Safe, came out and conducted an inspection of Provenir’s mobile abattoir, which had been operating for the last year in New South Wales, and granted a licence to operate in the company’s home state of Victoria.

“The process was quite long and in the first place we had to change the law, which was no small feat, and we did that on October 24, 2019. The legislation passed through the upper house of the Victorian Parliament and that basically added two words to the Meat Industry Act. Under the definition of an ‘abattoir’ it put ‘and vehicle’,” Mr Balasz told Talking Business

“They were the only two words that stopped us operating in Victoria.

“Then we needed the regulator to create a licence – so red tape is well and truly alive in Victoria – so we waded our way through that. So on July 1 they came in and inspected the unit and then on Tuesday this week, for the first time in Victoria, we processed cattle on the farm in which they were born and raised and produced the best quality meat in Australia – and that was done on my farm.”

THE ABATTOIR TRUCK SOLUTION

The abattoir is operating from a semi-trailer, the largest truck one could put on the road. It is wider than a normal truck, 3m versus 2.5m, and a fully compliant operational abattoir is inside.

The abattoir industry has gone through a generation and a half of consolidation. Meat regulations have increased and become stricter in the wake of the kangaroo meat and horse meat export scandals of the 1990s, forcing smaller operators out of the business.

The smaller operators were generally in regional Australia close to the point of production of the animals.

Abattoirs in Melbourne, Sydney and Brisbane had lower transportation costs from the point of slaughter to the point of consumption, while the abattoirs in regional areas struggled with the regulatory and transportation costs and they closed down.

“What that’s meant is the animal had to be transported a lot further than what they did a generation or so ago, and again that impacts on the quality of meat. That’s where our little business model puts all that on its head and we actually go to where the animals are,” Mr Balasz said.

It means the cattle are slaughtered without any stress at all, completing the duty of stewardship, he said.

COVID INCREASED AWARENESS

With COVID-19, there is more community awareness about how meat is produced and about food security and safety.

Mr Balasz said Provenir Meat gives that reassurance for consumers using its QR codes, which provide details about the kind of meat, the farm where it comes from, the species of cow and even some recipes for preparing the best possible steak.

“Every time they purchase a retail-ready pack of meat, it comes with a little QR code on it and, on any smart phone just on the camera, if you put that over the QR code, it links back to our web-based system which will tell exactly what the cut of meat is they just purchased,” Mr Balasz said.

“It actually gives some cooking tips there as well. How quickly do you sear an eye fillet, or what are some ideas that you can do with a bowl of roast? And we’ll add to that with more content and recipes on there.

“The next tab across tell you exactly which farm it comes from but beyond the name of the farm, it introduces the name of the farmer.”

It is a revolutionary approach to meat production – harking back to a more community-engaged erea – whose time seems to have come again in Australia.

www.provenir.com.au 

www.leongettler.com

Hear the complete interview and catch up with other topical business news on Leon Gettler’s Talking Business podcast, released every Friday at www.acast.com/talkingbusiness

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THE COVID-19 pandemic has probably derailed the heady optimism Queensland farmers enjoyed early in the year, with the latest quarterly Rabobank Rural Confidence Survey showing a distinct decline in farmer sentiment.

After experiencing the strongest rebound in the survey’s 19-year history last quarter, farmer confidence has now retracted, although sentiment remains higher than during 2019, and in line with levels last seen in late 2018.

Those Queensland farmers expecting agricultural economic conditions to improve in the coming year dropped to 24 percent – from 57 percent in the previous survey – while those expecting conditions to worsen rose to 27 percent – from just 13 percent last quarter.

Specifically questioned in this survey about the impact of COVID-19, 42 percent of Queensland producers believed the repercussions on their business were negative. 

Those in the sugar and dairy industries were most affected, with commodity uncertainty cited as a main concern.

This is in line with the overall survey, which pinned the wavering Queensland rural sentiment on commodity price and global market disruption – nominated by 37 percent of survey respondents as key reason conditions were expected to worsen.

BEHIND THE NUMBERS

Rabobank regional manager for Northern Queensland, Trent McIndoe said confidence was down across all commodity sectors – particularly among sugar and grain producers.

“Only 11 percent of sugar producers are expecting business conditions to improve over the next 12 months, which is well down on 48 percent with that view last quarter,” Mr McIndoe said.

Despite a mild wet season in key cane-growing regions such as the Burdekin, he said the price impact of COVID-19 was behind the downturn in sentiment, with commodity price uncertainty cited by Queensland farmers as the reason conditions were likely to worsen.

After rallying last quarter, sentiment among Queensland grain growers has slumped, with just six percent expecting business conditions to improve in the coming year – well down from 55 percent with that view last quarter.

While 56 percent of croppers expect little change from last quarter, 28 percent believe conditions will worsen over the next 12 months – primarily on the back of drought concerns and commodity prices.

RAIN, COME AGAIN

Mr McIndoe said widespread rain early in the year helped replenish soil moisture profiles, but in regions such as the Darling Downs and Central Highlands, grain growers were once again looking to the skies.

“By and large, Queensland cultivators had a reasonable soil moisture profile, generally there was a good start to the season, allowing most producers to begin their sowing program, however sufficient follow-up rain didn’t eventuate in some areas, and is now needed,” he said.

On the positive side, as barley is not a significant crop rotation in Queensland, Mr McIndoe said, the impact of China’s recent tariff announcement would be minimal.

While sentiment in the state’s beef industry fell from early-year highs, optimism prevailed, with 32 percent of the state’s beef producers expecting better conditions ahead – down from 61 percent last quarter –  and a further 46 percent expecting little change over the next 12 months.

With the survey revealing confidence was tempered by concerns about overseas markets, Mr McIndoe said the Queensland industry remained strong in the face of COVID-19.

“Cattle are still trading at high levels and, while survey respondents expressed frustrations over not being able to go to sales or view stock during lock down, there has been very little impact on farm finances so far,” he said.

“Domestic markets are very buoyant indeed, prices and demand are strong as restockers, and those seeking to source the finished article, compete for product.”

THE CHINA IMPACT

China’s suspension of four Australian meatworks fell narrowly within the survey period and, while it may not have impacted results generally, Mr McIndoe said, it could have broader ramifications if the suspensions were expanded or prolonged.

Producers in northern Queensland recorded the largest downturn in confidence in the state, and, with areas around central and north western Queensland remaining dry, he said this was reflective of the continuing poor season in the region.

Areas devastated by the 2019 floods have also received little relief, after some of the country failed to respond to rain early in the season.

Mr McIndoe described Queensland’s season as 'a mixed bag' with producers in the Channel Country enjoying timely autumn rain and abundant pastures – and, although confidence in the region retreated sharply from early-year highs, sentiment remained strong.

While the percentage of Queensland cotton growers expecting conditions to improve almost halved to 32 percent, sentiment remained well above levels reported last year.

Seasonal conditions and commodity prices were cited as reasons for concern, with early-year rainfall in the Central Highlands and Darling Downs failing to fill dams.

Prices were also back considerably, Mr McIndoe said, with cotton consumption dropping sharply as stores closed their doors through COVID-19 restrictions.

He said Rabobank was forecasting a 12 percent drop in global cotton consumption in 2020.

REVISING DOWN INCOME 

Queensland farmers revised down gross farm income projections considerably for the next 12 months, with just 23 percent expecting incomes to improve – down from 38 percent last quarter.

Whilst beef producers’ forecast incomes were downgraded, it was by a lesser extent than their counterparts in other industries, and the sector reported the strongest expansionary intentions.

Overall, Queensland farmers’ investment intentions were down – 16 percent of respondents now looked to increase investment over the next 12 months – although spending on on-farm infrastructure and increasing livestock numbers was predicted to be higher than last quarter.

“After devastating floods and droughts across much of Queensland, producers are now looking to restock and renew on-farm infrastructure such as fencing and yards.  Further property purchases also provide an opportunity to mitigate future events,” Mr McIndoe said.

He said the story for rural Australia was a unique one during COVID-19, with low interest rates, strong commodity prices and a good season in parts of Queensland placing the various ag sectors in a sound position.

“A large number of Queensland producers are still doing well, yet the overriding unease of COVID-19 is no doubt impacting sentiment,” Mr McIndoe said.

The Rabobank Rural Confidence Survey questions an average of 1000 primary producers across a wide range of commodities and geographical areas throughout Australia on a quarterly basis, providing a comprehensive monitor of outlook and sentiment in Australian rural industries. Regarded as the most robust study of its type in Australia, the Rabobank Rural Confidence Survey has been conducted since 2000 and the next results are scheduled for release in September 2020.

www.rabobank.com.au

ends

 

SEAFOOD Industry Australia (SIA) has called for State and Federal Government assistance to keep the industry afloat.

“We take our responsibility to provide more than one billion meals every year seriously, particularly at times like these, and we need government assistance to keep fish on the table,” SIA CEO Jane Lovell said.

“Since mid-January SIA has been working hard with all levels of government to ensure our industry receives the support it needs.

“We’ve asked all governments across Australia to help us through the next 6-12 months by removing all fees and charges across all of agriculture - not just the seafood industry. We need to secure Australia’s agriculture industry now, so we’re here to continue operating on the other side of this. 

“Globally, some markets are beginning to reopen and we need the certainty of freight to be able to access them. Getting back to work is the best sort of stimulus, it’s good for morale and it shows we understand our role in meeting the global food task,” Ms Lovell said.

“We are working with Seafood Trade Advisory Group (STAG), industry associations, seafood businesses across Australia and the Federal Government on ways to provide some certainty of supply. 

“We are also extending calls for calm among panic buyers. Our fishing vessels need to be restocked so they can go fishing, and this means we need more than two bags of frozen vegetables and two packets of pasta, and they certainly need some toilet paper.

“Some of our larger vessels have arrangements in place, but the rest of the industry shops at their local supermarket, just like you and me,” Ms Lovell said.

“We need to find a way for our bona fide primary producers to access the supplies they need, so our fishers can continue harvesting and growing the food we all need.

"The Australian seafood industry plays a critical role in the global food task, and we want to get back to work.

“We are confident we can continue to work with our governments on the logistics of the various lockdowns, and that the food supply chain will be recognised as an essential service.”

www.seafoodindustryaustralia.com.au

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THE Australian Small Business and Family Enterprise Ombudsman (ASBFEO) Kate Carnell said her office was now offering assistance with disputes that fall within the Dairy Code of Conduct.

The mandatory Dairy Code of Conduct took effect from January 1, 2020, giving Australian dairy farmers a framework to negotiate a fair price for their product.

The code applies to all milk supply agreements entered into, or amended, on or after January 1, 2020. 

“The introduction of a Dairy Code and the establishment of a dispute resolution process is a step in the right direction for dairy farmers,” Ms Carnell said.

“My office can provide small and family business owners in the dairy industry with information on the Code, as well as options to resolve disputes and access to mediation and arbitration services.

“The Dairy Code of Conduct provides dairy farmers and other industry participants with avenues for dispute resolution within a fairer framework while also helping them understand their rights and responsibilities," Ms Carnell said.

"In addition to the Dairy Code, my office can provide broader assistance to small and family businesses that also include disputes under the Franchising, Horticulture and Oil Codes of Conduct.”

www.asbfeo.gov.au

 

asbfeo.gov.au

By Leon Gettler >>

TOMMY HUPPERT, the CEO of Cannatrek, believes medicinal cannabis will be the biggest cash crop in the country, and an export earner.

Cannatrek has just got permission from Greater Shepparton City Council to build a $160 million medicinal cannabis production facility near Shepparton, Victoria. When completed, it will be one of the world’s largest medicinal cannabis facilities.

The facility will include a 160,000sqm growing area under a giant high-technology glasshouse, as protected cropping, maximising the yield of the plant.

Cannatrek is using technology pioneered by the Dutch, pioneers of the flower industry, who are world leaders in protected cropping. When operating at full production, the company aims to produce 160 tonnes of medicinal cannabis per year.

Mr Huppert said the medicinal cannabis market is enormous. 

He said while cannabis had been around for thousands of years, it is still new from a regulatory perspective as it has only been two and a half years since Australia’s Narcotics Drugs Amendment Act was passed in 2016. Early movers are now receiving licences from the Office of Drug Control and commercialising their produce.

“We believe there are 300 to 500 eligible patients under the current scheme,” Mr Huppert told Talking Business.

“Most of those patients don’t even know they’re eligible so we’re finding more and more people, when they’re visiting their GP, are asking about an alternative medicine to what’s traditionally been prescribed – and medicinal cannabis has now come as an optional therapeutic product of choice.”

READY TO ROLL

Cannatrek has operations in Queensland and phase one of the Shepparton plant will be started towards the end of this year, Mr Huppert said, and can potentially be in production next year.

Mr Huppert said it would create many jobs.

“It’s a very hands-on product, it is labour intensive,” he said. “For our facility in Shepparton, we believe in excess of 400 jobs will be created and that’s in the facility itself.

“That’s not including the maintenance and down supply chain jobs which will be required to support the entire industry,” he said.

“I believe the industry will need more than 10,000 jobs in Australia, industry-wide, over the next few years, as the industry develops.”

Mr Huppert said the legislation provided scope for Australia to become a major exporter of medicinal cannabis to countries that might not have the right climate conditions to grow it themselves.

“We have sun, obviously we’re a barren land. However, we do have water resources so Australia is really in a perfect ideal position globally to be a production source for the world,” he said.

Mr Huppert said Europe could be a major market as it do not have the ideal climate. Another market was the Asia Pacific region, with Japan bringing in legislation for access. 

“I really believe this whole industry is a one-in-a-hundred year event. Similar to prohibition of alcohol, we’re seeing it in our generation post-prohibition for the regulation of medicinal cannabis.”

www.cannatrek.com.au

www.leongettler.com

Hear the complete interview and catch up with other topical business news on Leon Gettler’s Talking Business podcast, released every Friday at www.acast.com/talkingbusiness.

THE Australian cotton sector is facing its toughest outlook in more than a decade, as ongoing drought slashes local production prospects to just 735,000 bales in the 2019/20 season, according to a recently-released report by Rabobank.

According to Rabobank analysis, it will be a long road to recovery, even in the event of significant water inflows next year, with any recovery to ‘full output potential’ – of around four million bales – only possible from the 2021/22 season.

In its report, Drought Drags Cotton to Decade Lows, the specialist agribusiness bank said all major production regions would “feel the pinch”, with southern Queensland and northern and central New South Wales the hardest hit. 

“We anticipate 735,000 new season bales will be picked next year, in line with broader market expectations of between 720,000 and 800,000 bales," Rabobank cotton analyst Charles Clack said.

“This would see the Australian crop come in at just 16 percent of ‘peak’ production last seen in the 2017/18 season and the lowest output since the 2007/08 drought.”

The result is a cut in exports by 50 percent year-on-year, he said.

FORWARD CAUTION

Looking further forward, the report outlines two scenarios for Australian cotton production out to the 2021/22 season.

“The first scenario assumes extensive rainfall across the east coast through autumn and in to winter,” Mr Clack said. “In this scenario, 2020/21 season production could potentially recover to around 2-3 million bales.”

Mr Clack said while lack of seed availability and uncertainty around water allocations, coupled with alternative summer crop plantings, would limit a ‘full recovery’ (of above four million bales), it was possible – under this scenario – in the 2021/22 season.

“The other scenario considers the impact of ongoing drought conditions,” he said, “which would see production fall further to around 500,000 bales.”

While the outlook is uncertain going forward, Mr Clack said the current supply tightness was likely to support domestic cotton prices, with prices expected to sit around $600/bale by the end of 2020.

“This outlook is also being supported by the uptick in global cotton prices and the depreciation of the Australian dollar, as well as China continuing to source cotton from non-US origins amid the ongoing trade war,” Mr Clack said.

Mr Clack said while China was likely to purchase some cotton from the US to fill orders, other countries, such as Brazil, are likely to gain a larger market share in China.

“Longer-term, this poses a risk for Australia, as there will likely be additional rivalry with Brazilian supplies – and hence a more competitive price environment – once production recovers,” he said.

 

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By Leon Gettler >>

CROPLOGIC, which spun out of the Institute of Plant and Food in New Zealand, the equivalent of the CSIRO and which is partly New Zealand government owned and listed on the ASX, is using the latest agricultural technology to expand into the United States.

It is operating in states like Idaho, the largest producer of potatoes, Oregon and Washington, and partners with farm agronomists.

The crops vary from region to region, from state to state.

In Washington, the big crops are row crops like potatoes, onions and carrots, with some cherries and a strong wine industry, Idaho has a big dairy and potato industry, Oregon is a big pear producer, and is also producing hemp.

In Australia, in the Mildura office, the focus is on citrus, almonds and viticulture. 

 

THREE UNIQUE PRODUCTS

CropLogic CEO James Cooper-Jones said CropLogic has three agtech products: CropLogic Real Time, CropLogic aerial imagery and CropLogic Predict.

CropLogic Real Time is a system of soil moisture sensors that go down anywhere from 2ft to 5ft into the soil and provide readings to a desk top and mobile app.

“That allows the grower to have in their palm the minute detail of how their moisture is reacting,’’ Mr Cooper-Jones told Talking Business.

CropLogic also provides infra-red aerial imagery of plants and crops.

“A healthy plant will give off a different infra-red image to a non-healthy plant or a stressed plant,” Mr Cooper-Jones said. “That allows us to produce images for growers that’s shows areas of their fields that might be stressed that may not be visible to the naked eye.

“When you’re talking about a growing period of say a potato crop of 16 weeks, you lose two weeks. You’re losing a significant amount of time of the optimum growing period.

“With this technology, that allows growers to tackle the issue and get the optimum growing days for each of their crops.”

 

AG SCIENTISTS HELP DECISIONS

Mr Cooper-Jones said CropLogic also brings in agricultural scientists to look at the data and help producers deal with the problem.

He said this allows the grower to decide what to do at the “click of a button”. 

CropLogic has had spectacular success in the US with a five-fold increase in the take-up of its technology.

“In some of our zones, and some of our target crops, we’re servicing as much as 30 percent of the market and that’s just astounding in just two seasons,” Mr Cooper-Jones said.

He said in Australia, growers were now enjoying increased citrus prices but the cost of water had also doubled in the Riverina, the Sunraysia and the Mallee regions.

“There’s no lack of demand, the price is going up, but increasingly water is becoming scarce so that’s where you’re seeing increasingly growers starting to look for digital systems,” he said.

www.croplogic.com

www.leongettler.com

Hear the complete interview and catch up with other topical business news on Leon Gettler’s Talking Business podcast, released every Friday at www.acast.com/talkingbusiness.  

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