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ACCC calls for beef sector transparency

beefThe key to improving transparency and competitiveness is to have changes in Australia’s cattle and beef markets, said ACCC.

Their market study highlighted the livestock industry’s shortcomings in price reporting, a lack of trust in the carcase grading system and concerns about anti-competitive conduct affecting competition in cattle and beef sales.

ACCC research involved consultations with all parts of the supply chain, and analysis of available market information and industry data.

“Many Australian cattle and beef businesses successfully operate in competitive export markets, but there are issues that need to be addressed to improve competition along the domestic supply chain,” ACCC chairman Rod Sims said.

“The final report makes 15 recommendations, which we believe will improve transparency, competition and efficiency in the industry.”

The ACCC’s 15 recommendations cover issues including:

  • Improving price information by requesting that meat processors publish price grids for sales made direct to processors. This will make it easier for producers to consider and compare price offers. Nationally, the vast majority of prime cattle are sold this way.
  • An increase in the frequency of AUS-MEAT’s random and unannounced audits of cattle grading and trimming in processing plants to improve integrity in the system.
  • The introduction of an independent dispute resolution process to apply across the industry.
  • The prioritisation of objective carcase measurement technology to increase the accuracy and transparency of carcase assessments, and the sharing of the data arising from the technology with cattle producers.
  • The introduction of a buyers register and post auction buyers report for major saleyards
  • Expanded reporting of historical prices to make it easier for producers to compare prices paid for cattle sold through saleyards, paddock sales and over-the-hooks.

“There is a need for the entire industry to take responsibility for implementing these changes; therefore the ACCC recommends that the Red Meat Advisory Council assume responsibility for implementing the recommendations. We encourage industry participants to work constructively with the Council to ensure that they are implemented as quickly as possible,” ACCC commissioner Mick Keogh said.

The consumer watchdog is also concerned about suggestions of anti-competitive conduct that emerged during the market study.

“The ACCC takes allegations of this nature very seriously and we are currently assessing if there are any breaches of the law. Misconduct in the agriculture sector is an enforcement priority area for the ACCC this year and if we find substance to these allegations, we won’t hesitate to take action,” Sims said.

They welcome progress made on some measures recommended in its Interim Report. These include Meat and Livestock Australia’s updated online market reports and moves to introduce objective carcase measurement technology.

“The improvements to MLA’s market reports allow producers to easily access historical price information so they can see which way prices are moving for stock,” Keogh said.

“The development of objective carcase grading technology is also encouraging. We urge the industry to get behind this for greater integrity and trust in the cattle grading system.”

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