Regional Feedlot Investment Study Update

Summary

Feedlots play an important role in rural and regional economies and enable a year-round supply of consistent quality beef and support greater efficiency in the pastoral and processing sectors.

This project provides up-to-date information on the economic contribution of feedlots in Australia and included consultation with industry to inform the economic modelling.

In 2017, the sum of direct and indirect (total) economic contribution of the national feedlot industry to gross domestic product was $4.4 billion (total national GDP in 2017 was $1.126 trillion) and approximately 31,000 full time equivalent jobs.

Objectives

This primary aim of this project was to provide background information on Australia’s feedlot industry, including markets served, an overview of 2017 and historical trends, and estimates of the existing economic contribution of the feedlot industry to Australia in 2017.

Key findings

• Average feedlot utilisation in 2017 was 81%, with a national quarterly average of 1.03 million head of cattle on feed.
• Relative to 2012-13, the feedlot industry had a much higher direct and indirect economic contribution in 2017, with a trade index of 161 in 2017, compared to 84 in 2012-2013. This is attributable to improved operating conditions in the feedlot sector, including higher grain-fed cattle prices and lower feed grain prices.
• When the economy is modelled without feedlots, there is a very large negative impact on gross domestic product (down by $10.3 billion), reflecting the influence of the Australian feedlot industry on the nation’s economy.

Benefits to industry

The project provides individual feedlots and other industry participants with a means of demonstrating the value of beef feedlots to the regional, state and national economies. This information is often used to support applications to local shire councils and the various levels of government, in areas such as feedlot expansion and licensing.

MLA action

Results of the study were reported to industry at Beefex 2018. The report and infographic were distributed to the Australian Lot Feeders’ Association and individual feedlots to provide resource materials they can use to demonstrate the value of the industry when dealing with local councils and government.