A Cottesloe-based agribusiness is hoping to improve operational productivity by increasing its use of data across the life cycle of its livestock and in its supply chain management.
A Cottesloe-based agribusiness is hoping to improve operational productivity by increasing its use of data across the life cycle of its livestock and in its supply chain management.
Harmony Agriculture & Food Co director Stephen Meerwald told Business News the company was formed 18 months ago, underpinned by the view that there was significant upside for improvement in managing agricultural supply chains.
Harmony has been backed by Chinese investors, with $50 million of capital injected into the business.
That cash was used to purchase a series of properties, including a beef feedlot 290 kilometres north-east of Perth and a 1,600-hectare property east of Esperance.
But Mr Meerwald, who worked at live export business Wellard for three decades, said a restructure of its balance sheet to create further latitude for growth was on the horizon.
Harmony plans to grow its sales to 100,000 head in the next two years, with the company’s herd currently around 18,000 head, half of which are in Western Australia.
The livestock will be bought from breeders, fed on Harmony’s lots and then processed or live exported to countries such as China, Japan and South Korea.
A key part of the operation will be to collect data on each animal and track it throughout its life, Mr Meerwald said.
That would enable the company to identify strategies to get the best results from its animals, and even tailor livestock to the requirements of particular customers.
Mr Meerwald said the business would be able to run an individual profit-and-loss statement and a productivity statement for each animal.
He said the technology was new to agriculture.
It puts a new spin on using electronic tags that track cattle, collecting data on livestock individually and running it through the company’s own data analysis program.
Eventually, Harmony plans to set up a system to weigh cattle daily when feeding, using walk over weights, giving a much larger than usual set of data points to track performance.
“Typically in agriculture, it’s about the average,” Mr Meerwald said.
Often, he said, data would not be passed through the supply chain, which was why Harmony’s approach to the collection and use of information was likely to improve the process.
“There are advantages to individual participants in the supply chain precluding others ... from information,” Mr Meerwald said.
“What we’re trying to do is say, if your business is all about the productivity of your animals, it doesn’t stop when you sell them.
“The information captured (in the supply chain) is as valuable as how animals performed on the farm.”
That was because it would enable breeders to optimise their cattle for long term sale arrangements, specified for their buyers.
Another innovation being used is cell grazing, a technique becoming more popular in the industry.
That method splits a paddock up into smaller zones for cattle to feed, and the livestock are moved between them over time to optimise land productivity and limit their wasted movement.
Trade win
Mr Meerwald said the current market for cattle was favourable, and recetly signed free trade agreements would continue to support the industry over the longer term.
“Australia has very high labour costs,” he said.
“We don’t have subsidies and government support that some of our competitor countries have.
“Having lower or no barriers as a result of the FTAs is going to be of great benefit to australian agriculture.
“It’ll be a little while, typically these things roll out over longer term, but we’ve already seen some advantages.”
