A cattle industry lobby group will intensify its campaign to lift the levy on beef transactions during a tour of the state starting at the end of April.
A cattle industry lobby group will intensify its campaign to lift the levy on beef transactions during a tour of the state starting at the end of April.
The Beef Industry Steering Funding Committee tour will visit Port Hedland, Dandaragan, Mt Barker, Fitzroy Crossing and Derby to rally support for its campaign to increase cattle transaction levies by $1.50 per head sold, to $5.
The BISFC is made up of producers, feedlotters and processors and was formed independently a year ago to investigate industry concerns about the future for cattle producers.
The levy recommendation and other initiatives were made in the recent Funding for the Future report.
Levy payers will be asked to vote on the proposal between June 14 and July 27, via a postal ballot.
In a report summary, the BIFSC says although the industry is strong, existing beef and cattle markets have to be secured and new markets developed. Research shows that an imbalance in supply and demand by 2009 could affect cattle prices, the committee says.
BIFSC chair Don McDonald said an increased levy amount would allow promotional programs, needed to safeguard the industry’s future, to go ahead.
He said the report’s key findings showed a global shift was under way in production and demand.
“Consequently, a stronger marketing drive is required to position more of our product into an increasingly competitive market-place,” Mr McDonald told WA Business News.
“A ‘yes’ vote for the levy increase would help protect Australia’s beef export markets and long-term cattle prices.”
Harvey Beef marketing manager Simone Williams said her company supported an increase in the levy provided the money was spent on marketing and developing marketing strategies.
“We need to do whatever it takes to ensure our position [export] is maintained and we hold onto our Japanese and Korean markets,” she said.
Mr McDonald said the committee’s research showed that Australian production was likely to increase by 335,000 tonnes by 2009, and with a corresponding growth in demand, the increase in supply could lead to a drop in cattle prices by between $70 and $90 a head.
Among other findings:
• the US is rebuilding its herd and is preparing to re-enter global beef markets with a well-financed marketing campaign; and
• beef production in Brazil, with a current herd of 165 million head, continues to rapidly increase, with a growing focus on securing new export customers, posing a direct threat to Australia’s traditional beef markets.
“Being 10 years since the last change in cattle levies, industry marketing reserves have been run down,” Mr McDonald said.
“Without additional investment the industry will not be able to maintain its current level of promotion, putting our future beef prices at risk.
“The committee found a further $21.3 million per year is required for market development and promotion.”
He said the marketing challenge was increasing domestic demand while defending the newly found position in Japan and South Korea, and positioning Australian beef against competitive countries such as Brazil.
WAFarmers meat section president Mike Norton said there would be mixed reaction among WA farmers to the proposal.
“The committee visited the top 20 per cent of levy payers and I think there is reasonable support there,” he said. “Whether they can do it with the smaller producers we will have to wait and see.”
Mr Norton said investment in marketing was needed for the continued success of the beef industry.
