LOCAL cattle producers have formed a cooperative structure to re-open the Kimberley Meat Co beef processing plant near Broome.
The business, which will operate under the name Kimberley Meat Co-Operative, will start killing cattle early next year.
In May, Kimberley Meat Co announced that it was in discussion with local cattle producers over a shareholding option in the meat plant, a wholly-owned subsidiary of Yeeda Pastoral Co. The plant has not operated this year, as Yeeda Cattle Co ‘re-prioritised’ its operations to benefit from the record high cattle prices. Instead of supplying cattle for processing through KMC, Yeeda Pastoral has this year been focused on selling its annual turnoff of sale cattle from its large Brahman and Droughtmaster herds, run across six Kimberley stations, mostly to east-coast producers who are restocking their herds after years of drought.
The company said back in May it would use the temporary shutdown to upgrade the plant, which had been operated for the previous five seasons.
The plant was originally built in 2015 by Yeeda’s Jack Burton.
On Friday, Yeeda Pastoral Co announced the creation of the Kimberley Meat Co-Operative, with 14 members indicating their intention to join. They include well known Kimberley stations such as Pardoo, Gogo, Anna Plains, Country Downs, Roebuck Plains and Yeeda, leading station owners such as Kimberley Agriculture and Pastoral Co and industry participants such as major independent Western Australian supermarket retailer Spudshed.
The cooperative model was chosen to align the interests of members in a collective endeavour.
The Kimberley business will join several other Australian meat processing enterprises operating under co-operative structures, the most notable of which are the Northern Cooperative Meat Co near Casino, NSW and the West Australian Meat Marketing Co-operative (WAMMCo) a lamb-only facility near Katanning, which also operates a second leased plant near Goulburn NSW.
The response from substantial local pastoral operators and other participants in the cattle processing and beef marketing industry indicated strong support for the cooperative model, and confidence in the future of the Kimberley cattle industry, Yeeda Pastoral Co said in a statement.
Membership would be subject to satisfaction of final conditions customary for a transaction of this nature, the company said.
KMC will acquire Yeeda’s modern beef processing facility 100km east of Broome – the only beef processing operation of any scale in northern WA. The site is 2500km from other meat works in the state’s southwest and 2000km from the closest processor in the Northern Territory.
KMC will have the capacity to efficiently process at least 40,000 head of cattle per annum on a contract processing basis for its members, Yeeda’s statement said.
The co-operative’s members will collectively commit to processing in aggregate at least 40,000 head of cattle annually from 2022, with the potential to increase throughput.
Each member will own an interest of between two percent and 20 percent, with membership interests corresponding to each member’s requested processing entitlement. The co-op will be governed on a one-member, one-vote principle and led by a board appointed by KMC’s members.
Low interest loans
As a co-op, KMC will have access to the WA government’s Co-Operative Loan Scheme, subject to the usual conditions of that scheme. Low-interest loans through the scheme allow cooperatives to claim a tax deduction on the principal repayments of the loan together with the usual taxation deductions of interest and fees.
Yeeda Pastoral Co executive chairman Mervyn Key said the formation of the Kimberley Meat Co-Operative marked a milestone in the history of the Kimberley pastoral industry, and he was delighted that so many strong and respected pastoralists and other industry participants had responded to the invitation to join in the ownership of the facility.
“This solution to beef processing will provide pastoralists with a safe, reliable and economic path to market as an alternative to live exporting – while adhering to best animal welfare standards including keeping transportation of livestock to a minimum,” Mr Key said.
“The Kimberley is a unique wilderness area and world famous for its free-range cattle. Located in the heart of the Kimberley, KMC will produce and market grassfed, no-added-hormone, lean beef products that attract a premium in domestic and overseas markets,” he said.
The facilities to be acquired by KMC comprise freehold land and buildings that house the processing facility, cattle yards, weigh bridges, holding yards and 2500cubic metres of advanced refrigeration space. The facilities are accredited by the WA Department of Primary Industries and Regional Development and HACCP approved, have Certified Organic and Halal certifications and licences to export product to Canada, the US, European Union countries, Japan, Saudi Arabia, Vietnam, South Korea, South Africa and Indonesia.
WA agriculture and food minister Alannah MacTiernan met with KMC’s prospective members in Broome on Friday to welcome the establishment of the cooperative.
“The Kimberley Meat Co-operative heralds a new era for northern beef, providing an independent processing facility for pastoralist members to locally process their cattle,” Ms MacTiernan said.
“We have been long-time supporters both of agricultural co-operatives and of local beef processing in the Kimberley, and this new ownership model will put the facility and the industry on a more sustainable footing moving forward.
“Local processing provides a new market for the northern beef industry, creating local jobs in the Kimberley and filling international demand for quality WA beef products. Importantly, the co-operative structure will also allow KMC to apply for support through our Co-operative Loan Scheme – which has provided more than $100 million in loans to WA co-operatives since 2004.”