A significant grainfed industry milestone will be reached next week when delegates attending the BeefEx 2024 conference in Brisbane pause to reflect on the passing of 30 years since the launch of the industry’s visionary, trail-blazing National Feedlot Accreditation Scheme.

The NFAS program – the first agricultural quality assurance program in Australia -underpins the integrity of the Australian lotfeeding industry. The program operates under a set of standards focussing on five key areas: quality management, food safety management, livestock management, environmental management and product integrity.

In line with quality management principles, the NFAS Rules and Standards have continued to evolve to ensure the program continues to meet the changing expectations of all stakeholders. As part of this process, the NFAS undergoes a formal independent review every five years.

In a symbolic launch of the NFAS initiative, NFAS license No. 1 was issued during the BeefEx 94 grainfed industry conference held in September 1994.

Set out below is an account of the evolution of NFAS published in the feedlot industry history, “Grainfed: The History of the Australian Lotfeeding Industry” written by Jon Condon. Copies of the book are available from ALFA.  

IN 1991, the concept of quality assurance in Australian agriculture was regarded with much reserve, and not a little suspicion. It was seen mostly to be the brainchild of theorists working in universities or bureaucrats working in regulatory circles – a worthy concept espoused by well-intentioned people, but not to be embraced too readily in a commercial sense.

To the extent that it meant something useful, it was seen as most applicable in the agriculture space to meat processing establishments or retailers, where cleanliness and good hygiene practises were paramount in delivering a safe food product to consumers.

Farmers, by and large, could be ‘relied upon’ to deliver product to customer requirements, and expected to do so with a minimum of paperwork and certainly not under the watchful gaze of impractical do-gooders who found their natural habitat in environmental and food safety agencies.

Such a view was consistent with the robust spirit of self-reliance that took the beef industry through generations of droughts, floods, market downturns and incompetent governments.

But the Australian Lot Feeders Association and its members had a pressing problem, and old ways were no longer good enough.

A ceremony was held at the BeefEx industry conference in September 1994, where a commemorative plaque and a framed copy of ‘NFAS Accreditation No1’ were presented by National Feedlot Accreditation Scheme chairman Kev Roberts, left, to feedlot operator and first accreditation holder, John Maguire, from Glenrowan feedlot on Queensland’s Central Highlands.

Former ALFA executive officer Bob Coombs remembers an evening in the early 1990s when his fax machine (the internet was still a decade away) started to disgorge a 100-page draft of the NSW Environmental Protection Agency’s conditions of approval for a planned new, large-scale feedlot to be built by Itoham at Rockdale*, near Yanco in Victoria. (* Today’s JBS Riverina feedlot.)

The fax paper coiled like a rope on the ground in front of the fax machine and headed menacingly down the corridor towards the bathroom. These draft conditions incorporated what a Japanese company principal later publicly described as “planting a forest” as well as numerous other regulations and restrictions.

This weighty document embodied everything that was going wrong with the regulatory response to the projected investment boom in cattle feedlots in Australia at the time.

Firstly, the scientific base was grossly inadequate. A substantial amount was known in the US about the environmental science of cattle lotfeeding, but perhaps not as much as expected. The industry in the US had few environmental hassles, and was well accepted as the mainstay of many communities.

Besides, US research results did not necessarily translate across to Australia. Our thin, ancient soils, relatively anaemic river flows and erratic climate meant different operating conditions than in the US feedlot areas of Texas and the mid-west.

Secondly, the investment surge in lotfeeding in Australia was not a gradual process. It was happening fairly quickly at the time, with companies, both domestic and international, looking to establish production hubs in Australia following the 1988 Japanese Government decision to progressively deregulate beef import controls.

Japanese companies, among others, decided to invest in the Australian feedlot industry, and in processing establishments to ensure reliable and more abundant grainfed beef production. Time was an asset not to be wasted. Business plans and funding sources could evaporate as time slipped by.

Thirdly, not all local councils were supportive of feedlots setting up in their region. As some examples, the Leeton/Yanco communities were highly supportive of the Rockdale project, to the extent that a public meeting was packed out with vociferous supporters.

In contrast, Dubbo Council came down firmly against a major feedlot investment by Mitsubishi, despite NSW government support for the proposal. Similar contradictions were seen among Queensland local councils.

Fourthly, approval authority was found, in practice, to be frustratingly diffuse. Local councils commonly had unfettered planning powers which, when uncompromisingly exercised, could lead investors through a steeplechase of variable separation distances; arbitrary limits on proximity to housing; and endless procrastination.

Finally, the industry could not offer much as a viable alternative to cautious government over-regulation. Public servants operated under legislation that held them accountable for any adverse environmental impacts from approved business.

This was not a climate for cutting-edge regulatory risk-taking. The only self-regulatory mechanism in place at the time was a rather nebulous Australian Meat & Livestock Corporation-administered purple tail tag system linked to feedlot registration. This process did not involve any significant environmental or animal welfare compliance obligations and was a low-key program, well buried in a backwater of the organisation.

Idea for QA self-regulation takes root

In 1990, Bob Coombs and some ALFA councillors discussed the idea of having the regulation system as the springboard for a self-regulatory quality assurance system linking grainfed standards to an industry administered QA system, requiring genuine compliance with environmental and animal welfare standards.

This was a quite revolutionary thought, for there were no self-managed QA systems in place, and only rare examples of it being contemplated across Australian agriculture at the time.

ALFA council detailed this concept on paper during a meeting in September 1990 and, as part of its debate, discussed a proposed cotton industry environmental auditing process with Cotton Australia’s Maree McCaskill and Harvey Baker. The cotton industry was also coming under environmental challenges at the time, mostly to do with pesticide use.

ALFA council decided to update ALFA’s Environmental Code of Practice within a month, and to investigate the funding of an environmental audit, as was proposed in the cotton industry.

Bob Coombs was asked at that meeting to prepare an options paper on how the concept of environmental auditing might be progressed. ALFA subsequently decided to build on the existing, fairly modest principles of grainfed beef standards linked to feedlot registration, and upgrade those systems to provide greater integrity.

This proposal was to be submitted to a National Feedlot Workshop for cross-industry and government endorsement. The first step was to obtain the support of the Federal agriculture minister of the time, John Kerin. A meeting at Parliament House was held on the eve of the minister’s announcement of the abolition of the wool floor price scheme.

Workshop to develop guidelines

With the strong backing of the Australian Meat and Livestock Industry Policy Council, a National Feedlot Workshop was convened in June 1991 to develop national guidelines for beef feedlots. At this workshop, ALFA foreshadowed the implementation of a feedlot quality assurance system. The workshop was highly productive, with all levels of government in attendance, together with Cattle Council and animal welfare bodies. It was a ‘live-in’ affair over two days, and was successful in reaching consensus positions on the national guidelines.

The process started inauspiciously with protracted debate about the definitions of a cattle feedlot and reached a low-point with a local government representative from Queensland assuring the workshop that whatever may be the policies of the Queensland government in cattle feedlots, local Councils had the right, which would surely be exercised, to set and enforce their own separate environmental policies. The guidelines were finalised at a second workshop held in March, 1992.

The working name, ‘National Feedlot Accreditation Scheme’, or acronym NFAS, started to appear in industry dialogue. Thus armed and fortified, ALFA approached AUSMeat to administer the proposed QA system. This was to be carried out in a similar way to AUSMeat’s administration of meat processing establishment accreditation and auditing. AUSMeat’s chief executive, expat New Zealander Ian King, was fairly new to his job. He was not opposed, but was cautious and stressed the importance of wider industry support.

Multi-stage plan emerges

A multi-stage plan involving a variety of stakeholders started to crystallise, that ALFA hoped would help effectively deliver the desired outcome – a self-managed industry quality assurance system. The critical objective was to achieve a rapid and comprehensive uptake, as it was feared that poor rates of participation in the early stages could spell the project’s death-knell.

ALFA’s solution was a somewhat bold and ambitious objective: making participation in the National Feedlot Accreditation Scheme a mandatory pre-requisite before Australian beef could be sold into international markets under Grainfed (GF) ciphers.

In essence, it meant that Australian beef product could not be described on international markets as ‘grainfed’ without being sourced from an NFAS-aligned feedlot. The first step was in reaching an understanding with AMLC about the plan – important, mostly, from the perspective of any future grainfed beef marketing support.

During 1993, ALFA then approached the Australian Quarantine and Inspection Service, seeking changes to Australian Export Meat Orders that would effectively limit the use of grainfed (GF) ciphers to beef sourced from NFAS feedlots. Perhaps understandably, AQIS was wary, telling ALFA that before it would consider any such move, it had to be convinced that it was widely supported across the grainfed beef supply chain.

Next step was a formal approach to the processing sector, through the Australian Meat Exporters Federal Council (AMEFC). ALFA councillor Kev Roberts, who played a critical role in the project’s execution, vividly recollects that the occasion felt like going before a panel of High Court judges on a charge.

The initial AMEFC reaction was cool, bordering on hostile. Issues such as the concept’s potential to limit the availability of grainfed export beef, and the suitability of AUSMeat as the administrator were raised. In particular, the proposed budget was requested, along with a suggestion that an alternative auditor to AUSMeat be found.

It’s important to understand that AUSMeat, at that time, had no direct engagement with the production sector, being specifically engaged in auditing, accrediting and monitoring the processing sector’s program.

Funding dilemma

The proposed budget for NFAS also proved to be a serious problem during discussions with export processors. Surprisingly, the exact number of operating feedlots in Australia was not even known at the time.

Participation rates could only be crudely estimated. The cost of field auditing was a further uncertainty: initial experience was that a private company would require fees that would jeopardise the affordability, and therefore acceptability, of the scheme to potential users – particularly smaller ones.

Despite these ‘unknowns’ ALFA president Rod Hadwen (then head of Australia Meat Holdings’ feedlots) and Kev Roberts were able to convince AMEFC to support the scheme.

Major processor Metro Meats’ Jack Ware was the AMEFC member credited with swinging his fellow boardmembers around in support. “Jack could see what we were trying to do, and why we needed to do it,” Kev Roberts recollects.

The ‘clincher’ was that AMH – easily the largest lotfeeder in Australia, as it is to this day as JBS – and a solid collection of other ‘larger’ lotfeeders, were prepared to commit to the program. This largely dissolved any uncertainty within AMEFC over access to grainfed cattle supply.

Once the AMEFC support was captured, ALFA was able to go back to AQIS with a compelling case to proceed, and AQIS subsequently approved an amendment to the nation’s Export Meat Inspection Orders to reflect the strategy.

Good neighbour, versus more Govt regulation

Before that could happen, however, a final working model had to be delivered. The new form of co-regulation in the shape of the emerging NFAS was necessary because it was becoming critically important that the feedlot industry demonstrate its ability to ensure that it was a ‘good neighbour’ through responsible environmental management, and humane treatment of stock.

The alternative to all this was increased government regulation. A Senate Committee report into the feedlot industry, while supportive of industry growth, had concluded that “unless a robust, credible self-regulation mechanism was put in place, the industry would need to accept tighter regulatory controls.”

AUSMeat’s Ben Andrews travelled widely on behalf of the newly formed National Feedlot Accreditation Steering Committee, enlisting support from State governments, supermarkets and industry associations. To their credit, both major supermarket groups, Coles and Woolworths, quickly added their support for the model, recognising the credibility to be gained in areas like environmental and animal welfare management.

Long gestation

NFAS was to remain, however, a work in progress for a considerable period. The Senate Committee report was, in effect, a shotgun held to the industry’s head: therefore there was a real sense of mission within ALFA about the importance of putting self-regulation in place.

Adding to its problems, ALFA had very few resources, and was stretched to, and sometimes beyond, its operating limit in setting about to deliver a workable plan. There was, however, a strong recognition within ALFA council that self-regulation had to be implemented, or industry growth would be stifled.

ALFA’s October 1993 AGM was held back-to-back with a technical NFAS seminar. ALFA annual meetings to that point had mostly been low-key events, with little controversy and much goodwill.

That was about to change. As they walked towards the AGM room on this occasion, ALFA councillor Kev Roberts, who had taken on the role as NFAS steering committee chair, and Bob Coombs noticed a pile of AUSMeat leaflets announcing the launch of NFAS.

This was surprising, to say the least. While the component pieces were by this stage on the table, the system was still being refined and had not yet been signed-off as ready to go by ALFA. The AGM (and subsequent council meeting that followed) were marred by persistent questions and criticisms about NFAS from the floor. It was clear that there were unanswered questions about the mechanics, if not the philosophy, behind the scheme.

Practical, affordable, capable

That evening Kev Roberts and ALFA president Rod Hadwen had a heart-to-heart about NFAS. It was agreed that it needed to be disassembled into its component parts, and thoroughly reassessed by ALFA to ensure that it was practical to feedlot operators; affordable to the industry members; and capable of being administered with a high level of community confidence in its integrity.

ALFA convened a special workshop in Sydney in October 1993 to pull NFAS apart, try to rectify the weaknesses, and remove the impracticalities. The workshop turned out to be more a technical fine-tuning than a complete engine rebuild, as many of the key features remained sound.

After all, the NFAS had come a long way over the past year, and such details as feedlot QA staff requirements, QA feedlot audit frequencies and the planned implementation timetable had been announced by the ALFA president at the AGM the month previous.

At that time, the NFAS was expected to be fully operational by April 1994. The October workshop agreed on a number of key points:

• NFAS must be internationally accepted, and both ALFA and participating feedlots must be prepared to publicly stand behind the system
• The core objectives were animal welfare and environmental management standards compliance
• Government and industry-endorsed Codes of Practice would underpin the program
• NFAS would be separate from, and did not replace State licencing, and pollution management requirements
• Also to be incorporated in NFAS would be an Animal Care Statement and requirements for the safe storage and use of chemical products based on Australian Veterinary Association standards.
• The old feedlot registration scheme would finish on 30 June 1994, to be replaced by NFAS.

So far, so good, but the key remaining problem was the affordability of the system. Only $80,000 had been spent by AUSMeat on product development/administration costs in 1991/92, but this had increased to $242,000 a year later and was forecast to accelerate to $585,000 the year after that.

User fees would fall well short of this amount. Fortunately, at this time ALFA was able to obtain funding support from the Commonwealth Government for NFAS, which provided start-up assistance to the scheme, and in particular for small feedlot operators facing the difficult and costly training and first round accreditation costs. These ALFA-administered grants were of fundamental importance in bridging the affordability gap.

Also important in delivering a cost-effective outcome were three other factors:

AUSMeat was able to multi-skill its area managers already involved with meat processing auditing to cover feedlots at an affordable rate. This marked the entry by AUSMeat into on-property auditing which was later extended to cattle, sheepmeat and live export operations, as well as non-livestock industry clients in other sectors relying on QA systems, like Organics. Putting together ‘milk-runs’ of audits also helped to moderate costs for new entrants

ALFA council held firm, despite some initial opposition within the feedlot industry, including threats of a breakaway Queensland organisation.

Some industry members made public statements suggesting NFAS was a conspiracy by large (perhaps even corporate or foreign-owned) feedlots to drive smaller members out of the industry, to their own advantage.

Finally, there was a growing realisation throughout agriculture and government that producers needed to be able to stand behind the integrity of their product. Such a move was to become much more heavily-entrenched in subsequent decades, but at the time this was a quite revolutionary notion.

After a further 12 months in development, the National Feedlot Accreditation Scheme was officially launched in 1994.

At the time of its launch, the NFAS program’s stated goals were to:

• Enhance the marketing prospects for grainfed beef by raising the integrity and consistency of the product
• Establish a viable mechanism for industry self-regulation as an alternative to statutory regulation, and
• Improve the image held by the community of feedlots, particularly relating to the environment and animal welfare matters.

Little has altered over the years from these fundamental goals. One of the keys to the scheme’s continued success has been its dynamic quality, allowing new industry requirements to be included, as appropriate, to address ever-changing market, consumer and government expectations over intensive livestock production.

Despite its earlier trials and tribulations, NFAS quickly matured into a well-respected and broadly accepted independently-audited QA system, which would become the fore-runner of similar programs across the beef and broader agriculture industries.

The scheme today is used almost universally across the Australian feedlot industry, managed under a successful industry and stakeholder partnership through the Feedlot Industry Accreditation Committee involving industry nominated representatives, state DPI representatives and AUSMeat.

Delivery on objectives

During a ten-year anniversary of the program’s launch 2004, then ALFA president Malcolm Foster said there was no doubting that the scheme had successfully delivered on its original objectives.

“Participants in NFAS can justifiably be proud of the success of their own industry-led QA scheme,” Malcolm said. “The standards continue to enable lotfeeders to satisfy customer expectations not only in the delivery of a consistent product to a minimum standard, but also of a safe product that meets community environmental and animal welfare expectations.”

His comments were supported by other red meat industry leaders of the era. AMLC boardmember and leading export processor Ian Kennedy, then head of Kilcoy Pastoral Co, said NFAS had provided a strong message about Australian grainfed beef ’s level of integrity on the world stage.

Woolworths supermarkets national livestock manager Rob Walker said with the growing emphasis on food safety, traceability and product integrity among consumers, the credibility of beef coming out of feedlots was of critical importance to his company. “NFAS delivers on this,” he said.

NFAS was always ahead of its time, but it was somewhat providential that it was put in place so early, for it is possible that the continued growth of the industry, and its community acceptance, would have been jeopardised without it.

The 100 pages of Rockdale feedlot development approval conditions that rolled off Bob Coombs’s fax machine way back in 1990 was a portent of what might have been if NFAS had not become a reality.