DIVERSIFIED sources of red meat research funding are paving the way for innovations capable of delivering market and productivity gains across the full spectrum of the beef and sheep supply chain.
With the 20-year low in cattle supply impacting levy dollars generated for the industry’s major research and adoption provider, Meat and Livestock Australia, alternative sources of funding has been a strong focus.
The diversification is making solid ground in lifting leverage on producer’s contributions.
Some strategic partnerships have seen investments pulled together into significant multimillion dollar programs, where leverage of levy funds is eight to ten fold.
Looking out to 2020, MLA aims to generate up to 65 per cent of its annual research and development investment from sources distinct from the producer levy.
The diversification had changed the landscape of how research was being championed and provided vehicles for funding farsighted, longer-term projects, according to MLA’s Dr Nicholas Sangster.
The key alternative funding source is MLA’s Donor Company, MDC, but others include rural research and development for profit funds from the Federal Government, co-operative research centres and co-investment projects.
MDC has been operating in overdrive this year, with the appointment of an inaugural chief executive officer Dr Christine Pitt in March.
MDC’s agenda is to attract commercial investment and fast-track innovations across the value chain so the Australian red meat and livestock industry can remain competitive on a world stage.
Since it began in 1999, MDC has brought in investment from every part of the value chain, including processors, value-adders, breed societies, large pastoral companies and even international collaborators and technology providers.
This has seen an investment in more than 800 projects with a total value of $320m.
As of the end of June, the total value of projects in progress within MDC was $130m.
Dr Pitt said those projects include animal health, eating quality and product integrity, environmental sustainability, automation, new products and packaging concepts and both on and off-farm productivity.
A key area of investment had been in the space of animal welfare and environmental improvements, she said.
“These are key areas for our industry as we move forward, helping to yield a more profitable, sustainable and globally competitive red meat and livestock industry,” she said.
A recent impact assessment showed for every dollar invested in MDC over the past five years, $4 in current and future benefits had been generated.
The development of a DNA-based diagnostic test for Johnes disease, which cuts waiting time from three months with the previous culture-based test to just one week, has been the result of one on-farm project.
Another big one has been automated processing technology.
“With more sustainable labour requirements, safer operating environments, less wastage and greater consistency, the value from this technology will flow back to producers,” Dr Pitt said.
“In fact, economic modelling shows that producers capture 24 per cent of the benefit from any increase in productivity by processors.”
Dr Pitt said there were considerable opportunities for livestock industries due to Australia’s comparative advantage combined with increasing global demand in emerging Asian markets.
“However, to realise these opportunities, the industry will need to embrace new approaches to innovation that focus on deep market insights, a focus on creating new customer value and a willingness to move away from a commodity mindset to one that delivers high value premium food,” she said.
“The future will be volatile and uncertain and companies that rely on a business as usual approach are unlikely to succeed.”