Beef levy review 2009

The Beef Levy Review was conducted to evaluate the effectiveness of the increased marketing component of the cattle transaction levy since 2006, and to determine the appropriate level of funding for beef marketing and trade development to ensure Australia's beef industry is competitively positioned.

Review result

Cattle producers voted to maintain the cattle transaction levy at its current rate of $5 per head at the 2009 MLA AGM, with a convincing 72.5% of votes cast in favour of the resolution (grassfed producers - 70.7%; grainfed producers - 75.8%). The vote was the culmination of a 12-month process including the Beef Marketing Funding Committee's review and a six-month campaign to create awareness among producers and encourage them to participate.

Over 70 forums were held across the country with more than 6,000 producers attending to hear more about the industry's promotional activities. The voting process - via a resolution at the MLA AGM and a concurrent poll for non-members of MLA - was conducted by Computershare. The entitlement process was audited in accordance with MLA's procedures and Ernst & Young was requested to overview this process. The producer peak councils, Cattle Council of Australia and Australian Lot Feeders' Association, have now presented a full report to the Federal Minister seeking the retention of the $5 cattle transaction levy.

Resources

Review findings

The additional marketing levy has delivered five times the investment back to producers.

  • The major impacts on livestock prices since 2006 have been high exchange rates and high grain prices until late 2008, and now credit restrictions on global trade and the collapse in demand for co-products. Without these impacts, livestock prices would be near record levels.
  • The red meat industry faces critical challenges, such as mounting attacks on the industry's environmental integrity and increased competition in major markets; as well as valuable opportunities, such as the industry's world leading systems in product quality, safety and industry integrity, which stands it in good stead to grow existing and capture new markets.
  • The industry must continue to invest in a broad range of programs to consolidate its position in beef markets and address the challenges and opportunities that lie before it.
  • The $5 levy is a modest but appropriate investment in the future of the industry.

Review recommendations

  • The current $5 per head cattle transaction levy rate should be retained.
  • A minimum return on investment to producers be set at three times the overall marketing levy as the performance yardstick in future reviews.
  • Future reviews of the levy be undertaken as a result of industry need, triggered by the peak councils, and not according to a pre-determined timeframe.

Beef Marketing Funding Committee

An independent committee was formed under the chairmanship of Queensland cattle producer Peter Hughes. The Committee sought submissions from industry and MLA, and also commissioned independent analyses on the benefits to industry from previous marketing expenditure. The committee members included:

Peter Hughes (Chair), cattle producer, North Queensland

Ian McCamley, cattle producer, central Queensland

Don Heatley, cattle producer, North Queensland and Chairman, Meat & Livestock Australia

Warren Barnett, grainfed cattle producer, southern New South Wales and Vice President, Australian Lot Feeders' Association

Jim Cudmore, grainfed cattle producer, south-east Queensland and President, Australian Lot Feeders' Association

Brad Teys, CEO, Teys Bros Pty Ltd

Peter Hall, cattle producer, North Queensland and member of the Cattle Council of Australia

Terry Nolan, Director, Nolan Meats Pty Ltd and Chair, Australian Meat Industry Council

Bill Bray, cattle producer, Victoria and Immediate Past President, Cattle Council of Australia

Michael Carroll, cattle producer, western Victoria and Director, Meat & Livestock Australia

Mike Introvigne, cattle producer, southern Western Australia

Don McDonald AM, OBE, cattle producer, North Queensland

Jen Munro, cattle producer, north-west New South Wales

Gary Tapscott, Commercial Manager Sheep & Cattle Operations, Elders and Director, Australian Livestock Exporters Council and President, Australian Livestock & Property Agents

 

More information

Phone: 1800 023 100
Email: info@mla.com.au

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