Report Detail Page

Development of supply chain objective measurement (OM) strategy & value proposition to stakeholders

Background

The red meat industry does not currently have all the measurement technologies and systems available and adopted that might assist to optimise red meat value within the supply chain. However, advances in objective measurement on the live animal, carcase or cuts have the potential to assist the red meat industry by improving efficiency and underpinning a new value-based transaction model.

All sectors of industry recognise that value is being lost through inaccurate measurement or appraisal systems and that this could be improved by addressing the current objective measurement related limitations. There is also recognition across the industry of the need for change.

2017 Project Outcomes

In 2017, MLA commissioned independent consultants to model the potential benefits of OM and related business model changes throughout the red meat supply chain.  This project was funded from MLA producer levies and AMPC processor levies, with matching funds from the Commonwealth.  

Deliverables included a detailed Excel model which allows on-going modelling of alternative scenarios and adoption assumptions, as well as an executive summary and detailed report on the most likely scenarios and benefits as at 2020 and 2030.

This report estimated that over $420 million of potential gross benefit per annum existed from the further adoption of objective measurements and associated pricing signals by 2030. Less than $75 million of this was likely to be realised by 2020 while around $250 million could be realised by 2030. The difference between potential benefit and likely benefit was the gap between opportunity and adoption.

These benefits were estimated to be split equally between producer and off-farm sectors of the supply chain over time in most of the scenarios modelled.

The 2017 executive summary and the more detailed report are available below.

2019 update on the model

The above model was updated in 2019 to incorporate updated estimates of adoption, as well as likely development times for key technologies underpinning the OM program. An updated report on potential and likely impacts from the OM program will be published once this project is finalised.

Meat & Livestock Australia acknowledges the matching funds provided by the Australian Government and contributions from the Australian Meat Processor Corporation to support the research and development detailed in this publication.

Downloads

Contracts

Contract No. Title Start date End date Funding type
V.MQT.0071
Development of supply chain objective measurement (OM) strategy & value proposition to stakeholders
07/12/2015 13/11/2017
Industry
V.MQT.0001
Revision of supply chain model supporting objective measurement (OM) strategy & value proposition to stakeholders
09/07/2018 30/09/2018
Industry

This page was last updated on 12/03/2019

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