Spring Angus: Verified black Angus beef carries a mark of quality

Managing director Patrick Warmoll is the third generation of the farming enterprise which began in 1947, when his grandparents Jock and Lola Warmoll started farming in the Gunnedah area.

The vertical integration began with the next generation, Mr Warmoll's father Phillip, and his brother David.

They joined the business in the late 1960s and early 1970s and started breeding Wagyu cattle in the 1991, crossing over Angus cows using semen from Wally Rae.

The Warmolls were supplying the live export market with steers, but there was little demand for the heifers, so in 1995 they started processing heifers for Japan, moving to carton beef in 1996.

The Jack's Creek branded beef business began in 1999 as one of the only companies processing European Union-accredited Wagyu.

"For a small amount of time we had the market to ourselves, but in those days, they were still convincing people what Wagyu was," Mr Warmoll said.

"They were part of the revolution of educating the market at that stage. In those days Wagyu was a loin cut business. There was no way that trim was carrying any type of premium, but that changed when the Korean market opened up, and South Korea has been a major supporter of the industry."

After working for a US investment bank in London, Mr Warmoll joined Jack's Creek in 2008 as the GFC hit.

At that stage the business was still producing only Wagyu, but Mr Warmoll knew the business needed a complementary program to grow. He turned to Angus, the next most recognised marbling breed in the world.

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What came next was a series of experiments, including days on feed, the use of hormones, and different Angus percentages, with Killara feedlot at Quirindi.

An opportunity opened up in Japan just at the right time, thanks to the closure of factories in Australia.

"Similar to the Wagyu business, without Japan at this stage of our market development, if we didn't sell Angus grain-fed beef to Japan, we weren't going to be able to have a business," Mr Warmoll said.

"After a while we realised when we were communicating the products to new customers, they wanted to know that it was purebred black Angus.

"Going with 150 days on feed gave me a good spread of marbling score of 1, 2 and 3, so we had three different products, at three different prices, and three different end users."

Angus cattle are sourced through the Elders Killara supply chain, the Smithfield supply chain, and Allan Gillogly's Montroes Feedlot near Moree.

Ninety per cent of cattle are processed at the Northern Cooperative Meat Company at Casino.

"The most important thing in a beef business from a supply point of view is continuity," Mr Warmoll said.

"We started with a B-double every second week and today we're processing 1100 Angus each week and 250 Wagyu."

Brand verification has been an important step for the Angus brands right from the start.

Jack's Creek has two brands - Jack's Creek Black Angus produced with 150-day grain-fed purebred black Angus cattle, and Jack's Creek Angus, a 120-day grain-fed product with a minimum of 75 per cent Angus genetics.

"Angus verification for our company is really important, even more so when we were starting out in the export market," Mr Warmoll said.

"Our main competitor is the US and they have a very strong Certified Angus Beef brand, and the brands USDA Select, Choice, and Prime grading system, so we're competing with them all around the world.

"At a restaurant level, if a customers asks us, 'why is your beef so good?' we'll offer to do a side-by-side blind tasting against another product they'd like to put on the menu.

"We're in the flavour business and what we're trying to produce is a consistent high quality flavour.

"We then tell them about the animal's life. The characteristics underpinning the quality is that it's pure black Angus, individually marble-scored and hormone-free, which is great for market access and a huge thing for marketing.

"They understand that they're all pure black Angus cattle, independently verified by Angus Australia, and sometimes they'll promote that in their restaurant, or they'll feature the verified logo, which gives the beef a mark of quality."

Jack's Creek beef is exported to more than 20 countries, with Japan remaining the largest market, followed by China, the Middle East, Europe and South East Asia.

The domestic market makes up only 10pc of the business.

"With all of our customers we try to put together a tailored package of products and they buy everything on an individual cut basis, based on what their customers are requiring," Mr Warmoll said.

"That's the hard part, maintaining the balance throughout the year and making sure we've got a quality supply 52 weeks in the year. It's all about maintaining relationships, and providing continuity."

Jack's Creek has dealt with plenty of challenges, but remains focused on supplying top quality marbling Angus beef to export and domestic clients.

Among the challenges have been the downturn in the beef market in 2016 following the beef boom of 2015, followed by the Casino processing plant being temporarily suspended from China in 2017.

"In the beef business, being a perishable product and reliant on weather, every day is a challenge," Mr Warmoll said.

Mr Warmoll is expecting a few new challenges in coming years as Australian producers move into a herd rebuilding phase after the current drought. Another major challenge will be dealing with increased competition expanding market access for all competing beef producing areas.

"There's a lot of interesting talk around market access these days, and the US looks like it'll get better access into Japan, so as a business we're preparing for these things.

"They're gaining the tariff advantage that we currently have, so it looks like it'll be a level playing field. As long as we're working hard and we're in tune with the market, opportunities will arise.

"Volatility creates opportunities so we want to continue to be nimble, agile and working hard."

Mr Warmoll said demand for high quality branded beef would continue, but he believed all markets were needed in the beef industry.

"As costs increase and other pressures are on us, Australia should be focusing on ways of branding products to make them stand out from the rest, such as the US, and South American countries. Countries like Uruguay are producing better quality grain-fed cattle, and on the grass-fed market, we need to be differentiating ourselves from Brazil, Argentina and New Zealand."