DSCY (Aust) Investments Pty Ltd has signed a Memorandum of Understanding with the Flinders Shire Council and NorthBEEF Inc regarding the development of an export-approved meat processing plant at Hughenden.
The move by the company with links to China has been described as an “exciting development” by NorthBEEF chair Rob Atkinson, that would offer an alternative market for livestock producers in northern, western and central western parts of the state.
“It’s a starting point, an understanding,” he said. “There’s no guarantee but nothing happens without an MOU. We’ve kicked a lot of tyres in the last four years, so it’s nice to be somewhere with a bit of certainty.”
If it were to become reality, Mr Atkinson said it would be three years before a plant was operational.
A non-traditional “quarter plant” is planned, where beef quarters would be packed into containers rather than packaged into boxes, for breaking into cuts offshore to suit clients’ domestic needs.
“The labour-intensive parts would be done over there,” Mr Atkinson said.
In addition to giving producers an additional market and increasing competition, having a meat processing facility closer to where the cattle are bred will address issues such as shrinkage costs, long wait times for slaughter dates, freight savings; improved animal welfare and would address transport matters such as driver fatigue and cross loading, according to Mr Atkinson.
Under MOU arrangements, NorthBEEF now has the job of negotiating sound cattle supply agreements and pricing structures with producers, both of which will be essential to securing livestock supply of up to 180,000 annually for the proposed processing plant.
“It’s important for us to continue to build our membership,” Mr Atkinson said.
“There will be preferential supply status and there may well be contractual arrangements around supply.”
Mr Atkinson said the MOU provides for NorthBEEF to have an ongoing decision-making role in the new venture, provide input into the branding of the products, develop an open and transparent business relationship between grazier and processor, and deliver improved returns for producers.
Flinders shire mayor Greg Jones said his council was fully committed to the project, which would create more commercial business opportunities in the area, along with increased job opportunities.
Cr Jones said each party to the agreement was working hard to bring the project to fruition, with council playing an important role in providing freehold land for the meat processing facility and road access, providing access to power to the site and facilitating a water service.
Council will also be assisting the investor with the necessary approval processes.
Cr Jones said council and NorthBEEF had met with the Townsville Port Authority and were hopeful of making bulk shipments direct to Asia from Townsville.
“They are improving their facilities, which may make it possible to lessen shipping times,” Mr Atkinson said.
DSCY director Miao Wang said her company was very excited to be developing a strong partnership with Flinders Shire Council and NorthBEEF Inc and in particular working with beef producers to meet their long-term aims for the industry.
Ms Wang said her company would take 100 per cent of production on conditions negotiated with producers through NorthBEEF.
She added that the market for Australian beef in China was very strong, so a consistent quality and supply of beef on long-term supply contracts was the aim.
She hoped a successful final agreement could be reached by each party early in 2016.
