The value chain for meat and livestock products - Research and development investment study

Summary

The R&D Investment Study (RADlS) is AMLRDC's major thrust to determine the best overall strategy for investing R&D funds. RADlS aims to provide a solid and well-researched basis for the Corporation to decide on its medium and long-term objectives and the particular R&D projects needed.to achieve them.

The value chain model which is described in this report was developed under RADlS to help identify R&D strategies which would give the best returns to the meat and livestock industries. It was designed to be used in conjunction with other methods which are described in separate reports. This report is No.9 in a series of 10 RADlS reports.

An earlier version of the value chain model was presented in a report dated February 1990. The modifications to the earlier model which are incorporated in this report include:

(i) Inclusion of 1988/89 data in the model so that it represents the average situation over two years,' rather than a one year 1987/88 "snapshot" represented previously.

(ii) A change in the information base for the farm sector. Farm costs are now based on ABARE survey data which have been disaggregated by region. The earlier version of the model used gross margin budgets produced by the State Departments of Agriculture.

(iii) Modifications to the cattle feedlot sector incorporating data obtained by the Australian Lot Feeders Association (ALFA). This indicates that the feedlot sector is larger than previously thought, and is continuing to expand

very rapidly. Earlier estimates of inputs and outputs have been confirmed.

(iv) Abattoir data have been checked and validated against information provided by several meat companies.

(v) In the wholesale sector more accurate cost and margin estimates have been obtained and other modifications made to reflect the diversity of operations conducted in this sector.

(vi) Alterations to product flows between abattoirs, wholesalers, retailers and exporters based on detailed fact-finding in these sectors.

(vii) Inclusion of additional data from the Other Meat Processing (OMP) sector and further disaggregation of this complex sector. The additional information was obtained from visits to OMP establishments in four capital cities and country areas.

(viii) Inclusion of new information on the important and growing food service sector and more accurate cost estimates for the butcher and supermarket sectors.