WHEN it comes to foreign investment in Australia Don Mackay, Rangers Valley, says it is a necessary adjunct to our economy.
“In the 61 years that I have been in the beef industry I have seen most of the north of Australia controlled by foreign interests,” he said at the rma conference.
“First there was the English then the Americans followed by a bit of Dutch and Malay, Indonesian and now China.
“Along the way they have made money and lost money. They float in and out.
“The Japanese who own Rangers Valley have invested hundred of millions of dollars and will sell it one day but the feedlot will still be there, employing its people.”
While Mr Mackay said he understood some people’s fears that China was a different kind of player in the game, being government backed and able to run at a loss, he said the notion of foreign investment was sound.
“Foreign investment is the only equity that comes into agriculture in Australia,” he said.
Other than a small amount directed at the likes of AA Co and Graincorp from Australian superannuation funds, there is not much new money other than from foreign owned entities.
Branded beef will survive
WHEN cattle prices return to near normal processors expect branded beef will remain a cut above commodity meat.
That’s the view of JBS livestock manager Duane Woodham and Rangers Valley boss Don Mackay, both of whom work in facilities that rely on brands to sell their product to the highest bidder.
“In Australia we can’t compete on price,” said Mr Mackay. “So we customise.”
At John Dee abattoir in Warwick, where Rangers Valley processes its beef, there can be as many as 120 skews on one run.
“That’s a lot of variation,” he said. “We do it if the customer is prepared to pay. We do things that the customer really wants and that is something that everyone in Australia can do.”
Diversification of markets was another plus. Back in 1989 80 per cent of export beef went to Japan and while it remains a strong buyer, taking 19 per cent of Australian production so too is South Korea at 17 per cent. There are other worthy markets.
“Two per cent of our product is shipped to Lebanon and people ask us why we bother,” said Mr Mackay. “We bother because that market is worth $75/kg.”
