Duxton’s Agri Bits and Pieces Vol. 208
Posted on: November 13th, 2014

QUOTE OF THE WEEK

Trade Minister Andrew Robb has clarified key details of the pending agreement on live cattle exports to China and long-running free trade agreement (FTA) negotiations as it nears resolution.

Mr Robb was in Beijing last week for FTA talks when news of the live cattle exports deal with China made headlines in Australia. Mr Robb also addressed criticism of the live cattle deal in Australia from anti live export critics Animals Australia, the Greens and Independent MP Andrew Wilkie over potential animal welfare outcomes.

Australia had successfully transported dairy cattle to China previously with the trade contributing to a humanitarian miracle. We are helping Chinese get milk. That’s what unfortunately some of our people in Australia don’t understand, that if you’re going to perform a humanitarian miracle – and that’s what’s happened in this country – 500 million people have come out of poverty in the last fifteen years; and that is a humanitarian miracle. It’s never happened in the history of the world and they’ve still got hundreds of millions to pull out of poverty.

Now that means higher quality food; it means a capacity to feed themselves in many respects. Now all of these things, like increasing the quality of our livestock, is a significant contribution.

http://goo.gl/99YreR

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LOCAL MILK MARKET THE KEY

The big opportunities for growth in NSW’s dairy industry will likely come from investment in manufacturing for export markets but the gap between supply and demand for fresh milk on the eastern seaboard is also providing fodder for expansion.

While there is conjecture about numbers, industry leaders and analysts are all pointing towards significant increases in milk production in the next five years to fill both local and overseas markets.

The State government is making moves to ensure the potential for that growth is realised.
It has set up a $1 million dairy project fund with the agenda of driving on-farm and supply chain expansion, development of alternative marketing options and business models for investment.

An advisory committee, with members from farmer groups, is being appointed to ensure funds are invested according to industry priorities.

The fund was supported by a report, released in September, commissioned by the NSW government and prepared by Victorian consultants Fresh Agenda.

Called Growing the NSW Dairy Industry, it highlighted the opportunities in the domestic market with a growing population and demand for milk and found NSW’s cost efficiencies in freight compared with Victoria should help stabilise prices in the future.

Local drinking milk is the key market for the NSW dairy industry, accounting for about 68 per cent of the 2012-13 production.

More than half of sales are through supermarkets.

Private labels have a higher share of the supermarket channel in NSW than nationally.
The report projects fresh milk demand will increase by just under 5pc to 2018-19, while Queensland requirements will lift by 8pc.

That is based on Australian Bureau of Statistics population projections and static per capita consumption.

Industry body Dairy Connect NSW’s chief executive Mike Logan said the liquid market was under-supplied to the tune of 100 million litres, with the biggest shortfall in Queensland where producers had been subjected to extremely tough seasonal conditions and natural disasters.

NSW farms were expanding to fill that void with Dairy Australia figures showing a lift in production this year in the order of 2pc to 3pc.

Increasingly, Victorian milk is being diverted to augment NSW and southern Queensland supplies.

“But for the industry to grow substantially – in the order of 50pc as opposed to 10pc – we need to attract investment in new manufacturing and we are getting very close to that,” Mr Logan said.

The potential was there for growth in the order of 500 billion litres in the next five years.

http://goo.gl/ejnxqM

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MEAT COMPANIES GO ANTIBIOTICS-FREE AS MORE CONSUMERS DEMAND IT

The Food and Drug Administration, responding to concerns about antibiotic-resistant bacteria, asked drug and meat companies late last year to end the practice of feeding antibiotics to livestock to speed growth.

Kentucky farmer Brandon Glenn had already gone further. Not at the behest of the government, but of a meat company for which he raises chickens.

“I was pretty apprehensive,” the farmer says of instructions three years ago from Perdue Farms Inc. to halt almost all antibiotic use. “How are we going to keep these chickens alive without giving them their medication? But Perdue said: ‘This is what the market is going to.’”

Perdue is among a growing array of food producers moving to limit the routine use of antibiotics in livestock production—less in response to regulatory action than to consumer pressure.

Competitor Tyson Foods Inc. launched a brand of chicken without antibiotics last year and also markets antibiotic-free beef. Retailers where people now can buy meat raised without antibiotics include Wal-Mart Stores Inc. and BJ’s Wholesale Club Inc. Fast-food chain Chick-fil-A Inc. says it is phasing out all chicken raised with antibiotics over five years.

Antibiotic-free beef, pork and chicken account for only around 5% of meat sold in the U.S., by industry estimates, but its share is growing quickly. Sales of such chicken at U.S. retailers rose 34% by value last year, according to market-research firm IRI.

Prices at the supermarket for these products are much higher, rewarding producers for higher production costs, but also imposing an affordability limit on the market.

Meat producers’ growing embrace of the niche draws praise from health advocates worried about a rise in some types of antibiotic-resistant bacterial infections. They regard the commercial moves as a breakthrough after years of tentative actions by regulators.

“We are seeing companies come to the table because of public pressure in a way they haven’t before,” says Susan Vaughn Grooters, a policy analyst for Keep Antibiotics Working, a coalition of health, animal-welfare and environmental groups. She says that the FDA is “being outpaced by the microbes themselves and by the industry.”

The FDA views its approach of seeking voluntary changes as the most effective way to reduce antibiotic use in animals, arguing that a ban could tie it up in lengthy legal proceedings.

The market shift echoes other industry responses to consumer concerns about the safety or ethics of food production. In the pork business, Cargill Inc. is among companies pledging to phase out cramped “gestation stalls” for pregnant sows. Other companies offer products free of ingredients from bioengineered crops.

More than two million Americans a year develop bacterial infections resistant to antibiotics, which kill at least 23,000 annually, according to a report last year by the Centers for Disease Control and Prevention.

To read more, visit http://goo.gl/nCBExv

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CHART OF THE WEEK

This year, research firm Midan Marketing surveyed US grocery shoppers and found 88% were aware of antibiotic use in animals and 60% were concerned about it. This awareness has resulted in US consumers spending significantly more on chickens raised without antibiotics.

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JOKE OF THE WEEK

 

 

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