PRIME Minister Tony Abbott dropped into Beef 2015 on Friday to make a funding announcement for the industry – but not one related to drought support as many had speculated.
An announcement on that front is still expected in coming days, but rather Mr Abbott used his visit to Australia’s beef capital to pledge $100 milion in funding to improve roads that are critical to the beef industry.
The new $100 million Northern Australia Beef Roads Fund will make targeted upgrades to key roads necessary for transporting cattle.
This will underpin the future viability of the cattle industry which has long been a pillar of the northern economy, Mr Abbott said.
“Moving cattle in the north, from farm gate to market, involves some of the longest land transport distances of any Australian commodity,” Mr Abbott said.
“Land transport costs in the northern beef industry comprise up to 35 per cent of the market price of livestock.
“The long distances raise costs and increase risks – floods and seasonal road closures can isolate producers from markets for extended periods of time.
“The Northern Australia Beef Roads Fund will improve the productivity and resilience of cattle supply chains in northern Australia.”
The Fund will rely on the CSIRO’s state-of-the-art logistics modelling, which for the first time looks at the whole cattle supply chain – every farm, road, stopover, port and processing facility in the country.
The modelling allows analysts to test different scenarios, such as how sealing a road will influence transport times and costs. Using this approach, targeted upgrades that improve one road ‘link’ can strengthen the entire supply chain.
These improvements will also benefit other road users, boost regional communities and improve the profitability of a range of businesses – including pastoralists, livestock transporters, processors, and live exporters.
The Government expects that northern jurisdictions wanting to benefit from the Fund will contribute to the funding and consider deregulation options to benefit the industry.
“We want to cut red tape and establish more consistent regulations in livestock transportation in northern Australia” Mr Abbott said.
Federal agriculture Minister Barnaby Joyce told a Beef 2015 forum on Thursday that the Prime Minister was expected to make an announcement on drought support in coming days.
AA Co welcomes fund announcement
As one of the largest northern beef roads users, the Australian Agricultural Co welcomed the Federal Government’s pledge of $100 million to help fix critical roads in the region.
AA Co chairman Don McGauchie said the funding, which would go specifically towards roads used in the beef supply chain, was a strong statement of support for the beef industry in northern Australia.
“The lack of properly sealed roads where we operate in northern Australia means that critical supply chains can be closed for months at a time when it rains,” he said.
“Research shows there is a 13 percent loss in value due to the inability to sell or move large quantities of stock during the wet season.
“The Federal Government understands the importance of the beef industry to Northern Australia and has recognised the logistical issues facing our growing industry. The world’s growing middle class is demanding more and more premium Australian beef – this package will help us get it to them faster and more consistently.”
AA Co’s submission to the Federal Government’s White Paper on Agricultural Competitiveness recommended the Government investigate the need to upgrade sealed roads.
The submission noted CSIRO research which said the per km transport costs for a B-double vehicle can almost double if the vehicle is delayed due to unsealed roads.
ALRTA welcomes beef road commitment
The Australian Livestock and Rural Transporters Association welcomed today’s announcement.
The announcement is in line with the recommendations contained in the final report to the Australian Parliament on the Inquiry into the Development of Northern Australia.
ALRTA National President Grant Robins said today’s announcement was great news for everyone in the Australian beef supply chain and all road users across Northern Australia.
“Road transport is typically the first and last link of our agricultural supply chains, bringing vital supplies to our production centres and taking produce to our markets.
“Beef cattle have the highest embedded transport cost of all Australian commodities and improving the road network on which this produce travels will deliver significant economic benefits for livestock transporters, beef producers and the regional communities of Northern Australia.”
Allocation of money from the fund will rely on the CSIRO’s state-of-the-art logistics modelling which for the first time looks at the whole cattle supply chain – every farm, road, stopover, port and processing facility in the country.
CSIRO has consulted with ALRTA members including North Queensland operator and immediate past National President Liz Schmidt in developing the Transport Network Strategic Investment Tool.
Some of the beef roads already identified for further development include Buntine Road, Barley Stock Route, Duncan Highway, Buchanan Highway, Outback Way and Tanami Road.
“The ALRTA and our State Associations will continue to work with the Commonwealth Government and CSIRO to identify other priority beef routes. We will also encourage our northern State and Territory Governments to contribute to the fund to maximise development potential for the beef cattle industry in Northern Australia,” President Robins said.
Click here to access Beef Central’s recent Top 25 Livestock Transporters Feature.