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Sheepmeat Council : Sheepmeat 2015 2016
8 SHEEPMEAT COUNCIL OF AUSTRALIA ANNUAL MUSTER 2015-16 Jeff Murray President, SCA President’s Report Welcome to the 2015-16 Annual Muster. In general, the industry has again had an optimistic year. While the rainfall nationally was lower than average in most of our sheep producing regions, the sheep and lamb prices averaged higher than the previous year for January to June 2015. Global demand for lamb has increased slightly, resulting in an increase in lamb exports, highlighting the progressive growth of the Australian sheep industry. USA, China and the Middle East still remain our biggest markets. High turn-off rates mean that the prediction for the Australian flock is to remain similar to a year ago, or to drop slightly. For SCA, the year of 2015 has been heavily focused on setting the foundations for the industry to continue on a successful journey and meet the expectations of our consumer. There have been a number of key achievements this year, a few of these are outlined below. • S CA is custodian of the Sheep Industry Strategic Plan 2020 (SISP) which was launched in September. Modelling for the five-year plan – through the Meat Industry Strategic Plan – estimates that if all of the activities were to be undertaken for the sheepmeat industry, the plan would deliver increased net industry income of $728 million by 2020 and $3.49 billion by 2030 on the baseline projection. The overall benefit to cost ratio is 2.8:1 at 2020 and 5.7:1 at 2030. I would like to thank Kate Joseph for the work she has put into reviewing the past SISP and development of the SISP 2020. Without Kate providing a significant amount of unpaid time the development of this plan would never have been possible. Hard copies can be provided on request or downloaded from our website: www.sheepmeatcouncil.com. au • Lobbying has achieved beneficial outcomes for sheep producers under the China Australia Free Trade Agreement, which we achieved with a phase out of current tariffs to zero over eight years, modelling shows that the potential benefits are more than $150 million each year by 2024 – with the value over the next 16 years being in excess of $1.8 billion. The economic modelling by the CIE indicates that the elimination of these tariffs under the agreement could result in sheepmeat prices paid to producers increasing by 13- 26c/kg (dressed weight). • Lobbying for sheepmeat to be included in the Indian FTA has required significant attention this year. Whilst there has been no modelling done, at this stage, to indicate the potential return to producers we know that Australian red meat exports to India have been relatively insignificant over the past few years – with only 65 tonnes of Australian sheepmeat exported in 2013, with a further 45 tonnes being shipped in 2014. There have been no recent shipments of Australian live animals to India. Therefore, there is significant potential for increased consumption of Australian sheepmeat and goat meat to India if the trade barriers are addressed. SCA has been ensured that the negotiators are aware of the importance of sheepmeat being included in the agreement currently being negotiated. • In the Trans Pacific Partnership, industry efforts achieved a phase-out of tariffs on sheepmeat into Mexico over eight years and elimination of tariffs for sheepmeat into Peru and Canada on entry into force. • Continued work with ALEC on the ESCAS improvements and opening of markets to build the live export trade which underpins the sheepmeat industry, particularly in WA. • Lobbying government to maintain the current mob based system for sheep traceability rather than implementation of the eRFID. Implementation of the eRFID system would incur large costs to producers due to infrastructure and tag costs. SCA lobbying has been accompanied with concerted efforts to work with government and industry groups to identify issues in each state and to fix the problems in the traceability system, therefore, encouraging all participants to see the benefit in the system. • SCA has worked with the wool industry to secure funding for the National Wild Dog Action Plan. • Competitiveness in the red meat processing sector. SCA provided a submission on behalf of the sheepmeat producers to the recent Senate Inquiry. The sheepmeat industry partnership and collaboration throughout the supply chain has been part of our success. The submission recognised some areas for further work including improving the sheepmeat language, greater flow of information up and down the supply chain and having price information readily available for producers. • Last year, SCA led the rebid for the Sheep CRC 2014-2019, successfully gaining an additional five years of government and industry funding. In total $45 million will be invested into the sheep industry. This year SCA has been involved in the implementation of the CRC 2014-2019 which has three programs: 1. Enhanced sheep wellbeing and productivity 2. Quality based sheep meat value chains 3. Faster affordable genetic gain More information is available on the CRC website: www.sheepcrc.org.au • S CA continued its role in providing the oversight of the sheep transaction levy. The levy is distributed to MLA marketing, MLA R&D, Animal Health Australia, and National Residue Survey. SCA is