ALFA Lotfeeding July 2012 - Queensland Country Life

ALFA Lotfeeding July 2012 - Queensland Country Life



2 LOTFEEDING, July 2012

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President’s report ........................... 4

Chief executive’s report ................... 7


COVER STORY: Dealing with grain

price pain ....................................12

ANALYSIS: Lloyd George ................ 17


The Female Factor ...................... 22

Elders drives performance ............18

Specialist treatment pays .............. 22

US researcher talks up protein ....... 24

Truly at home at Kerwee ................ 28


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President’s Report JULY 2012

Lotfeeders shrug off

economic woes

THE lotfeeding sector in Australia remains

under the strain of world economic

uncertainty, ‘stop-start’ export

demand and volatility in the Australian

dollar compared to the US currency.

The daily news cycle continually reinforces

the difficulties some countries

in Europe are having in facing up to

the hard political decisions and the

potential negative impacts that poor

policy and weak governance may have

for the world economy.

Australia continues to be a shining

light on the world stage; however, the

old adage that ‘if the US sneezes,

Australia catches a cold’ remains as

valid today as it has in the past.

The problems in Europe are not necessarily

directly affecting our industry,

but the constant negative feedback on

global uncertainty and potential recessionary

trends in various countries

continues to destabilise our export customers’


Our core Asian grainfed beef markets

of Japan and Korea continue to be

bombarded with US product as that

country seeks to expand market share

at the expense of Australia.

The currency advantage has enabled

the US to displace Australian grainfed

beef in Japan, although there has

been solid demand for grassfed beef,






allowing importers to supply less expensive

cuts through the supply chain.

Korea has maintained, incredibly,

good volumes of beef from Australia,

despite the intense competition from

the US. Australia’s ability to ensure

these markets receive safe, hygienically

processed beef that provides a

wide array of cuts and meal options

will hopefully continue to stand us in

good stead for the future.

The importance of strong, robust

negotiations in relation to free trade

agreements that will deliver positive

outcomes for Japan, Korea and Australia

cannot be underestimated.

The news is not all negative, however.

Australian exporters are performing

extremely well in advancing grainfed

beef offerings into the emerging

markets of Indonesia, South Asia, the

Middle East, China and Russia.

Despite some of the challenges

around market access to these destina-

Australian exporters

are performing

extremely well in

advancing grainfed

beef offerings into

emerging markets.

tions – both political and technical –

exporters (with the assistance of MLA)

have made real ground in expanding

upon the wide range of grainfed options

from Australia.

Europe also continues to provide

further opportunities for Australia

with the duty free quota for high-quality

grainfed beef set to be extended to

48,200 million tonnes in August.

Industry has been working tirelessly,

with the support of an ‘all of industry’

approach through the Red Meat

Advisory Council, to ensure we have

the systems and pathways to capture

the maximum potential from this highvalue


The Australian market remains a

core strength for the lotfeeding sector.

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y the retail sector, and the industrysponsored

consumer awareness program

for MSA, have enabled the consumer

base to re-engage with beef.

Consumer research post the MSA

consumer education campaign indicated

that over 50 percent of viewers

stated the ad made them ‘feel more

confident selecting beef identified with

this symbol’ and believed that ‘beef

marked with this symbol is of higher


As a result of the advertising, the

MSA symbol was perceived by consumers

as ‘easy to understand’, ‘trustworthy’

and ‘credible’.

Retailers have indicated that the

symbol has helped to increase sales of

some lines by up to 10pc compared to

same week results from last year.

Expectations are that this will increase

over time due to growing awareness

and trust of the symbol.

Also, the generic marketing campaigns

developed and managed by

MLA appear to be gaining traction

with consumers.

Although most lotfeeders do not

have the opportunity to access the

marketing ‘vision’ that our city cousins

do, the advertising and marketing

material developed by industry appears

to connect with consumers.

While it is not being translated into

increased consumption in kilograms

per head of population, we do seem to

be arresting the slide in consumption

that some of the negative connotations

and adverse publicity for the cattle industry

have driven.

I congratulate all those lotfeeders

who responded to the grainfed levy

marketing survey for the FY2013 year.

Your responses have enabled ALFA

Council to collate a wide cross-section

of views and provide positive feedback

to MLA, thereby ensuring that together

we can allocate strategic funding to

the areas where industry believes the

resources will enhance the uptake of

Australian grainfed beef across many

market destinations.

While there is a view held in some

quarters that marketing levy dollars

could be invested in programs directed

by those processors in specific markets,

generic marketing programs using producer

funds expended through MLA

provide the opportunity for significant

market development in both mature

and emerging markets.

The opportunities for companies,

brand owners and producers alike to

access socialised funding (livestock

transaction levy) for market development

can only assist the beef industry

Retailers have

indicated that the

MSA symbol has

helped to increase

sales of some lines

by up to 10pc.

in its continued trajectory to supply

safe and well described meal options

within Australia and around the


Australia is unique, given the supply

chain systems and programs we

have implemented to ensure real product

integrity for our local and overseas

beef customers.

However, we should not become

arrogant or complacent about the true


value these systems provide to our


The Safemeat Initiatives Review of

industry systems is scoping out longterm

improvements that can be additional

to the current network of

accountabilities for food safety, biosecurity

and market access.

ALFA is engaged in the process on

your behalf to ensure we have wellresourced

capabilities into the future.

I would also like to thank those lotfeeders

who provided feedback on the

grainfed levy research and development

program for FY2013.

While there is always an element of

risk in all R&D programs, ALFA has

continually strived to achieve sensible

and responsible spending in this area.

Many of the initiatives may only

provide incremental benefits to lotfeeders

in their daily goal to reduce costs

and increase performance outcomes –

if the research proves positive.

● To p11

LOTFEEDING, July 2012 5

6 LOTFEEDING, July 2012


Chief Executive’s Report JULY 2012

Consumer perceptions

good for feedlots

IN line with its charter, ALFA is a

passionate advocate for the cattle

feedlot sector. We have access to an

array of media-monitoring tools,

which have been set up to detect criticism

of the sector, and we respond

promptly without fear of favour.

However, given that we tend to focus

on these criticisms, it is easy to feel as

though this is representative of general

consumer sentiment. In contrast, consumer

research indicates that the reality

is quite different, with ALFA now

modifying our strategy as a result.

Meat & Livestock Australia conducts

regular consumer survey and

focus group research to determine consumer

perceptions, key drivers of purchasing

decisions and changing trends

over time. The research is conducted

using representative demographics and

sample sizes of the main grocery buyers

in Australia on an ongoing quarterly

basis. The results are comprehensive,

with some of the key take-home messages

as follows:

● There is no ground swell of consumer

opposition against the cattle feedlot

sector. In fact, 84 percent of consumers

are either indifferent or are considered

‘low carers’. Only 13pc of Australians

believe that beef is not produced in an

ethical and animal-friendly manner,

with these consumers tending to be

females who don’t have children and

are vegetarian.

● When buying red meat, consumers,

in order of priority, are looking for quality,

value, convenience, nutrition and



chief executive


origin. Even when pushed, consumers

don’t believe that animal welfare and

ethical considerations are significant

drivers of purchasing decisions. This

makes sense, given that while consumers

believe that the poultry industry

has the most animal-welfare issues,

they still nonetheless purchase more

chicken than any other protein.

● Consumer focus group feedback

regarding ALFA’s feedlot YouTube

videos was positive, with comments

such as, “Farmers care about the welfare

of their animals, are passionate,

trustworthy, honest, have generations

of experience and are knowledgeable

about their work”.

Another interesting finding of MLA

consumer research is that Australians

don’t associate grainfed beef with feedlots.

This is probably due to the predominance

of grassfed extensive cattle

production undertaken in Australia.

Grainfed beef is viewed as higher

quality, more expensive, special occasion

meat, which is both better for

consumers and cattle. In contrast, feedlots

in general are perceived as having

diametrically opposing attributes to

grainfed beef.

When buying red

meat, consumers

are looking for

quality, value,


nutrition and origin.

Consumers in general also don’t

make the distinction between grass

and grainfed beef – it is all just beef.

So what does this research tell us

and what should we think or do differently?

The following are some key messages

that ALFA has taken from the

research, with our communication

strategies adjusted accordingly:

● That ALFA should continue to counter

the negative comments regarding

the cattle feedlot industry, but should

not be concerned that such sentiments

represent the views of the general


● That while industry pride in feedlots

is not misplaced, we are far better off to

focus on grainfed beef and the positive

consumer stories surrounding it.

● That given the lack of consumer distinction

between grass and grainfed

beef, we are better off advancing grainfed

beef, but not at the expense of

grassfed beef. ● To p9

LOTFEEDING, July 2012 7


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● From p7

Consumer perceptions

good for feedlots

It is also worthy of note that while

the feedlot industry continues to fly

under the radar in the minds of most

consumers, this does not mean that

lotfeeders can be complacent regarding

their practices.

Conversely, it takes only one poorly

managed feedlot to potentially tarnish

the whole industry.

The live export saga is instructional

in this regard.

Lotfeeders need to keep cattle and

feedlots in good condition, be vigilant

regarding trespassers and be constantly

aware of the role they play for the

wider industry.

Social media

As part of ALFA’s community communications

campaign, ALFA has been

increasing its use of social media to

educate a wider audience regarding

the systems, practices and people within

the feedlot sector.

Nine videos have now been developed

and uploaded onto YouTube,

a Facebook site has been created

( AustFeed lots) and

a Twitter account set up (@AustFeed


We have further video plans, such as

to show a year in the life of a lotfeeder

and/or a feedlot steer.

By such videos, we hope to highlight

Lotfeeders need to

keep feedlots in good

condition, and be

constantly aware of

the role they play for

the wider industry.

the people in the industry, the systems

we have and care shown, the complementarities

with the extensive grassfed

production system, and to show not

only the positives of the system, but

also the realities.

Our research has shown that it is

important from a transparency perspective

to explain, for instance, that

pen conditions are not always perfect.

David Maconochie from Hopkins

River Beef has uploaded the following

YouTube video on precisely this subject:

bIa4 VAruU

Lotfeeders are encouraged to get

involved in social media, as your

message is far more powerful than that

delivered via ALFA.

Social media is all about numbers,

and the more numbers organisations

and companies have following them,


the more influence they hold.

For instance, given that the RSPCA

has 90,000 followers on Facebook as

compared with MLA’s 374, it is clear

that the RSPCA has considerably more

potential influence with the general

public, media and government.

However, it is also about individual

involvement, with the Indonesian live

export saga demonstrating the ability

of producers as the real experts on the

industry to change the debate.

Agriculture has traditionally waited

for a crisis to become active. Unfortunately,

however, the opinions and views

of thousands of otherwise ignorant consumers

are being formed by the inaccurate

comments of a few individuals

with particular agendas right now.

Lotfeeders are the ones who have

most to lose regarding such commentary,

therefore it is vital that they

become more active in this space.

Members are encouraged to involve

their family, employees and their

friends in social media, and to also follow

certain organisations so that responses

to inaccurate comments are

made and balance is provided.

Some recommended organisations

and individuals to follow include the

RSPCA, the Centre for Food Integrity

(and Charlie Arnott), MLA, ALFA,

Animal Liberation and Animals Australia.

● To p11

LOTFEEDING, July 2012 9


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● From p9

Crisis management

The suspension of the live export

industry following animal welfare

concerns in Indonesia and a general increase

in consumer interest in animal

welfare and environmental matters

prompted discussions within ALFA

regarding the development of a crisis

management plan for the industry.

As a result, ALFA appointed consultants

360m to develop and implement

such a framework, with the process

now nearing finalisation.

The crisis management framework

is designed to ensure orderly, timely

and effective decision-making in relation

to heightened risks to the feedlot


It provides a comprehensive structure

for ALFA’s issues and crisis

management across the three phases

of preparedness, response and recovery.

It sets out the arrangements to

ensure coordinated action by ALFA to

risks (perceived, real, actual or imminent),

with the capacity to impact the

integrity, performance, reputation, and

survival of the industry or its members.

The process of developing the

framework has proven to be as valuable

as the final documents themselves.

Not only has it provided a

sobering reality check regarding the

● From p5

But the very nature of research

means there are some programs that

may yield little in the way of benefits,

or may only reinforce what we already

may have a ‘gut feel’ about. The current

portfolio of MLA R&D programs overseen

by ALFA covers a wide array of

areas, with an increased focus on greenhouse

gas emissions from various aspects

of our enterprises, and potential

mitigation opportunities that may be

available, and more importantly, positive

from a cost-benefit standpoint.

Under the guidance of program

manager Des Rinehart, ALFA is continually

assessing the value for lotfeeders

in the research, development and

extension space, and is analysing potential

new R&D areas as they arise.

Animal Health Australia (AHA) is

providing good service to industry in

ensuring we have the necessary capa-

requirements to adequately manage

such an issue, but it has allowed us to

think more strategically about crisis

prevention and mitigation. It has also

instilled a more disciplined approach to

issues and risk management, while

being a catalyst to instigate other

changes within the organisation.

When contemplating crisis management,

one is constantly reminded of the

litany of examples of how not to manage

a crisis. A quick look on the internet

provides some illuminating insights.

For example, in 2000, Ford and Firestone

Tire and Rubber entered a dispute

regarding the cause of over 100

deaths in the US from faulty tyres. The

two companies committed three major

blunders early on, say crisis experts.

Firstly, they blamed consumers for

not inflating their tires properly.

Then they blamed each other for

faulty tires and faulty vehicle design.

Lastly, they then said very little

about what they were doing to solve

the problem until called upon to testify

before Congress.

ALFA will be hoping to avoid such

disasters through the development of

the crisis-management framework.

Carbon legislation to commence

With the carbon legislation set to

commence in July, lotfeeders need to be

across what this means for their busi-

President’s Report JULY 2012

bilities, programs and training to effectively

respond in the event of an exotic

or emergency animal disease.

The management of biosecurity in

Australia has afforded our industry

many opportunities in the past (most

notably market access), and we must

encourage not only industry participants,

but all state jurisdictions and

the Commonwealth, to step up to the

plate to ensure we have in place solid

producer awareness, training, emergency

preparedness and response programs

to combat the incursion of any

disease in the cattle herd.

ALFA has been influential in the

development and improvement of the

Emergency Animal Disease Response

Plan (and Agreement) and Ausvetplan

for the benefit of industry, while also

continuing to advocate for increased

government funding and resources,

given the public benefits involved.

ness. In readiness for the legislative

enactment, ALFA has organised two

tailored workshops to be undertaken in

June to explain how the legislation will

impact upon the sector and what potential

opportunities are available for


Without wanting to be clichéd,

places in these workshops are filling

fast and accordingly, it is recommended

that lotfeeders contact ALFA to reserve

a spot ASAP.

The workshops will be held in

Sydney on June 19 and Brisbane on

June 26. Presenters will be Mick

Keogh, Australian Farm Institute, and

Stephen Wiedemann, FSA Consulting.

Registration fees will be $375 for

ALFA members and $450 for nonmembers.

Risk management

Following member demand, this

year ALFA plans to organise two grain

price risk-management workshops –

one in Sydney on August 28 and the

other in Toowoomba on August 29. The

workshops will also include a section

on the Australian Cattle Trade Rules.

Both will be delivered by Robert

Herrmann from Agconcepts.

The early bird prices (before August

1) are $250 for ALFA members and

$300 for non-members. Late registration

fees will be $275 for members and

$325 for non-members.

ALFA has been working with AHA

to determine a practical and applicable

methodology in the event lotfeeders

are exposed to a major disease crisis

and compensation needs to be considered.

Despite the lengthy process, we

are reaching the final conclusions

around appropriate mechanisms to

address compensation within the


BeefEx 2012 will be held at Royal

Pines, Gold Coast, on October 10-11.

The two-day program will be sensational

and will cover many of the topics

that are current and relevant today in

our industry. Our events committee,

staff, sponsors and support networks

have created a program of high-calibre

presenters and industry participants

to share their knowledge and stories.

I hope you can take the opportunity

to join the biennial celebration of the

grainfed beef industry.

LOTFEEDING, July 2012 11

ALFA Cover Story

How to ride the grain

price rollercoaster



THE Australian feedlot industry

is a major purchaser of feed

grains. Based on 2010 figures,

the total grain used in the animal

feed industry is estimated at

nearly 9 million tonnes, of which the

beef feedlot industry procured about 21

percent or nearly 1.9 million tonnes of


However recent spikes in the world

wheat price seem certain to impact on

the bottom line for the feedlot industry.

Recently Caitlyn Gribbin from ABC

Rural reported that a wheat price rally

had hit lotfeeders.

A southern Queensland lotfeeder

says rising wheat prices could mean a

$100,000 increase in monthly feed

costs. Smithfield Feedlot is one of

the country’s largest family-owned

operations, feeding 18,000 head of

cattle on a 50pc wheat and 50pc barley


Managing director Jason Shearer-

Smith says the global wheat price rally

of nearly 20pc in 10 days will tighten


On a 100-day

animal, it’s

probably increased

our costs by

$20-25 for the

feeding period.

“On a 100-day animal, it’s probably

increased our costs by $20-25 for the

feeding period,” he said.

“Given prices for our finished cattle

are relatively flat, if you’re turning off

4000 to 5000 head of cattle a month by

$25, it starts to add up.

“If there are lotfeeders that only had

a month’s supply, they’re probably

looking at the current increase with a

certain amount of concern.”

Traders see solutions

Robert Herrmann, the managing

director of one of Australia’s leading

agricultural futures trading companies,

Ag Concepts Unlimited, believes

the feedlot industry can better handle

fluctuations in the grain prices.

Mr Herrmann says only a small

number of lotfeeders in Australia are

managing their risk on grain price fluc-

tuations through grain price mechanisms

available to them today.

Mr Herrmann said feedlots had a

number of products they had been able

to use to ‘lock in’ the price of grain.

Forward contracts have generally

been the preferred method, with the

use of US-based wheat futures also

used but to a lesser extent. Forward

contracts have relied on the buyer and

seller agreeing on a price, and the

buyer and seller relying on the integrity

and financial stability of each

other to either make or take delivery.

At various times this trust has not

been reciprocated, either intentionally

or unintentionally. This situation can

be exacerbated when Australia is subject

to severe drought when some

producers cannot supply despite their

best intentions.

Using futures to manage price risk

removes the risk of buyer or seller

‘default’, as the futures exchange

guarantees the performance of each

contract traded.

Using futures to manage price risk

involves trading a ‘buy’ or ‘sell’ futures

contract, which matches the intended

12 LOTFEEDING, July 2012


DMS|BEN 1003094B

DMS|BEN 1003094B

action of the lotfeeder in the market at

sometime in the future.

Mr Herrmann says that major price

fluctuations in world markets can

create widespread distress among

those in the grain industry, not only

for those who produce it but also the

consumers of grain.

Adverse weather

When adverse weather in Australia

causes widespread drought leading to

reduced yields for grain producers, the

ripple effect is felt through the grain

industry supply chain.

The knock-on effect creates a

greater demand from the ‘intermittent’

users of grain such as woolgrowers and

dairies, to keep their breeding animals


These intermittent users of grain

and the already established industry

of feedlots, poultry and piggeries conspired

to create larger than usual

demand. In a year of shrinking crops,

the demand and supply forces can

cause domestic feed grain prices to

reach record highs.

Mr Herrmann says that historically

members of the Australian grain

supply chain had few options to

manage the price of grain in years of

significant price fluctuations.

Merchants have always been reluctant

to offer forward contracts because

they could not offset the risk somewhere

else without great difficulty.

Use of the historical hedging tool of

grain producers in Australia, Chicago

Board of Trade (CBOT) wheat futures,

has proved a difficult way to control

the price of feed grain because of the

variations between the world wheat

prices (CBOT futures) and the domestic

feed grain market.

Grain futures

contracts provided

feed grain users with

a risk-management

tool to effectively

manage price risk.

Mr Herrmann says that in May

2004, the listing of the Australian

Stock Exchange (ASX) grain futures

contracts provided feed grain users

with a risk-management tool to effectively

manage the risk in their feed

ALFA Cover Story

Smithfield Feedlot managing director Jason Shearer-Smith (with office manager Barb

Madden) says any increases in grain price soon add up.

grain price by “locking in” the domestic

feed grain price, rather than the international

wheat price.

The ASX has listed five grain

futures contracts, namely – milling

wheat, canola, sorghum, feed wheat

and feed barley. The three most relevant

for feed grains are sorghum, feed

wheat, milling wheat and feed barley.

Each futures contract is 20 metric

tonnes of feed milling wheat, feed

barley or sorghum and the ASX futures

contracts are deliverable.

Upon maturity of the contract you

will either receive grain if you have

traded a ‘buy’ contract or will be required

to deliver grain to an approved

grain storage if you have traded a ‘sell’

contract. ● To p14

LOTFEEDING, July 2012 13

DMS|BEN 1003094A

ALFA Cover Story

● From p13

Grain contracts can be closed out

early by taking the opposite position

in the futures market to the original

trade to avoid taking or making


Grain hedge for a feedlot

It is mid-August and a feedlot based

at Wagga is expecting to buy feed

wheat, feed barley and sorghum

around harvest time.

However, they are concerned about

supply from the upcoming harvest and

want to protect against rising prices.

The feedlot calculates that they can

pay $240/tonne for feed wheat, $210/t

for feed barley, and $200/t for sorghum

on a port basis.

Mr Herrmann said it should be

remembered that feed wheat is not

currently traded on the ASX grain

futures but feed barley and sorghum


In order to manage the feed wheat

risk the feedlot needs to adopt a basis

risk management policy buying milling

wheat futures. At the delivery time of

the futures contract the milling wheat

futures are either closed out with a

futures cash credit or a debt owed to

the ASX by the feedlot.

For example, at delivery time, the

14 LOTFEEDING, July 2012


milling wheat future can be closed out

and the cash credit or debit applied to

purchasing feed wheat locally.

Alternatively if no feed wheat is

available locally the feedlot will conclude

the futures contract and take

delivery of the milling wheat, which

the feedlot will then swap at this location

for feed wheat.

The basis risk reasoning and methodology

is that milling wheat and feed

wheat will fluctuate in the market in

similar patterns so the market risk can

be minimised.

Feed wheat hedge plan

Mr Herrmann provided an example

of how to hedge the risk of feed wheat

prices increasing.

The feedlot would trade a ‘buy’ milling

feed wheat futures contract on the

ASX with a January maturity.

The January ASX feed wheat futures

contract is currently trading at

$240/t, so the feedlot elects to hedge

100t of their feed wheat requirements.

The feedlot does not want to take delivery

of the feed grain from the futures

exchange, but intends to buy it from

the grower nearby at harvest.


The feedlot is protected against crop

failure by the option of choosing to take

delivery of the traded futures contracts.

After taking the ‘buy’ futures

positions for wheat feed in January, the

local producer cannot deliver the grain

because he has had an extremely bad

season where the crop has not come up.

ALFA Cover Story

Market rises for feed wheat

Cash (physical grain) market Futures market

August Expect to buy 100 tonne of Trade 5 “Buy” January ASX

feed wheat in September for Wheat futures contracts at

$240/mt (Port Kembla basis) $240/mt

January Buy 100 tonne of feed wheat Sell back the 5 Futures

from the local grower at contracts at $260/mt,

$260/mt (Port Kembla basis) therefore cash credit of


Result Price paid to local grower is

$260/mt (Port Kembla basis)

minus futures credit of


260 - 20 = $240/mt

Market falls for feed wheat

Cash (physical grain) market Futures market

August Expect to buy 100 tonne of Trade 5 “Buy” January ASX

feed wheat in September for Wheat futures contracts at

$240/mt (Port Kembla basis) $240/mt

January Buy 100 tonne of feed wheat Sell back 5 Futures contracts

in the cash market from the at $220/mt, therefore cash

local grower at $220/mt (Port

Kembla basis)

debit of $20/mt

Result Price paid to local grower is

$220/mt (Port basis) plus

futures debit of $20/mt

220 + 20 = $240/mt

This leaves the feedlot short on the

100t of feed wheat contracted.

The advantage of the ASX grain

futures is that they are deliverable

contracts, meaning that the feedlot is

not in such a sticky situation after all

in regards to their feed wheat.

● To p16

LOTFEEDING, July 2012 15

ALFA Cover Story

● From p15

If the feedlot does not close-out the

contracts prior to maturity on the third

Tuesday of January, the feedlots’ five

bought contracts will convert to five

contracts (100t) of physical wheatfeed.

A certificate from the ASX will then

be issued explaining the details of the

purchase, including which store the

feed wheat is located.

The process of hedging feed barley

and sorghum are the same as for the

feed wheat.

However, because the feedlot is

located in NSW and the feed barley

contract is Geelong port-price deliverable

on Victorian track and the sorghum

Brisbane port-price deliverable

Brisbane track, the feedlot decides not

to take delivery of the grain be-cause

they feel a better net cost can be

achieved locally.

Freight savings

The feedlot thinks that by allowing

for freight savings to the grower they

can buy feed barley $10 better locally

and sorghum $5 better locally than the

port prices.

Currently the January futures market

is trading at $210 for feed barley

and $200 for sorghum.

Mr Herrmann says that to establish

a risk management system using a

hedge mechanism with the ASX the

following steps are required:

● Establish an account with a broker.

● Estimate consumption levels for the

following year.

● Determine target prices.

● Determine the most appropriate contract.

January feed barley or milling

wheat futures have the greatest liquidity.

You may like to use futures, options

or swaps.

Market rises for feed barley

Robert Herrmann, managing director of one of Australia’s leading agricultural futures trading

companies, Ag Concepts Unlimited, says he believes the feedlot industry can better handle

fluctuations in grain prices.

Cash (physical grain) market Futures market

August Expect to buy 100 tonne of feed

barley locally in January for


January Buy 100 tonne of feed barley

from a local grower at $200/mt

Result Price paid to local grower is

$230/mt The futures credit


Market falls for feed barley

Trade 5 “Buy” January Feed

Barley futures contracts at


Sell back the 5 Futures

contracts at $240/mt,

therefore cash credit of


230- 30 = $200/mt

Cash (physical grain) market Futures market

August Expect to buy 100 tonne of feed

barley locally in January for

$200/mt (Geelong Port basis)

January Buy 100 tonne of feed barley

from a local grower at $190/mt

Result Price paid to local grower is

$190/mt (Port basis) plus

futures debit of $10/mt

Trade 5 “Buy” January Feed

barley futures contracts at


Sell back 5 Futures contract

at $200/mt, therefore cash

debit of $10/mt

190 + 10 = $200/mt

● Determine what percentage of estimated

consumption you wish to hedge.

● Place your orders with the broker.

● As the season progresses and consumption

levels and market prices become

clearer, you should increase or

unwind your hedged position as appropriate.

● As expiry of your contract nears, you

will either cash settle or take delivery

of your open contracts as desired.

More information

For more information on how to

manage market risks in feed grain in

the feedlot, Mr Herrmann suggests

feedlot operators should contact an

accredited futures trading organisation

to assist with a grain pricing riskmanagement


16 LOTFEEDING, July 2012



AgIntel (03) 9598 1980

FEW would have envisaged that

domestic grain supplies may

start to run short this year after

producing a record 29.5 million

tonne wheat crop, but it’s starting to

feel that way.

Sure, running short may be an overstatement.

The latest Australian

Bureau of Statistics data is still showing

there was 18.9 million tonne of

wheat stocks held by the major bulk

handling companies at the end of April.

But strengthening local prices while

international prices wobble is a good

indication that local wheat supplies

are getting much more difficult to buy.

These stronger prices are not an

isolated occurrence either. Traders and

end users across eastern Australia are

all reporting that it’s much more difficult

to secure wheat supplies.

There appears little doubt that

grain supplies held on farm are starting

to dry up, helped in a large part by

a record export pace.

Australia has already exported 13.9

million tonnes of wheat and 3.9 million

tonnes of barley in the seven months

from October 2011 to April 2012.

This is up by 29 percent for the

same time in the previous year for

wheat and a whopping 94 percent

increase for barley.

Record high expected for wheat

Wheat exports are expected to be a

record high 22.5 million tonnes for the

October to September marketing year

and barley exports will be one of the

largest ever.

Exporters and bulk handling have

both done a remarkable job this year

and deserve a pat on the back – first at

making the export sales for the

massive crop, and second at ensuring

the grain gets shipped on time given

the record volumes and the ailing


Rapid export pace

boosts prices

This is no mean feat given the

massive changes to the operation of the

marketing and logistics operations in

recent years with the deregulation of

wheat exports and now capped with

the record export volumes.

But why does it, all of a sudden,

become difficult to buy wheat when

there is nearly 19 million tonnes still

held by bulk handlers?

Well that’s one of the difficulties of

the new deregulated wheat marketing

system; a sizable part of these stocks

have already sold to overseas buyers.

This is clearly a new risk for domestic

users in Australia that they didn’t

have to contend with under the previous

single desk marketing arrangements.

Under the prior system, end

users could safely assume they could

secure their grain requirements by


Why does it, all of a

sudden, become

difficult to buy

wheat when there

is nearly 19 million

tonnes still held?

bettering the pool price. Growers wanting

to sell for cash gravitated to the

domestic buyers. And even if this didn’t

work they had the comfortable fall

back of trying to buy off the pool operator

if the season turned nasty.

Pool operators were also amenable

to this system so long as they got a

better price than they could achieve in

the export market.

The advent of multiple exporters, all

aggressively trying to make sales has

made it a lot more difficult for domestic

buyers as they try to understand

how much grain is yet to be sold. And

more importantly, what’s still available

to be bought.

Sales determining decisions

The United States, the world’s

largest grain exporting country have

experienced their own difficulties in

this area. The US introduced a mandatory

export sales reporting system for

export grain sales after the Soviet

Union made a huge and unanticipated

purchase of US grains in 1972, latter

deemed the ‘Great Grain Robbery’,

resulting in domestic grain shortages

and record grain prices.

I am not suggesting Australia’s

grain supplies are likely to disappear

overnight as a result of unforeseen

exporter sales as was seen in the US.

But it’s still fair to say that domestic

end users now have to consider the

pace of export sales in their grain

marketing decisions.

In a worst case scenario, it’s possible

that domestic users could be left short

of grain because the crop, even a large

crop, has been sold into export markets

thereby forcing prices sharply higher.

● To p24

LOTFEEDING, July 2012 17


THE Elders feedlot operation is a

major buyers of heifers for the

feedlot industry in Australia.

Elders has two strategicallylocated

feedlot operations with a combined

capacity of 40,000 standard

cattle units in Australia – the Killara

feedlot at Quirindi in NSW servicing

the northern region of Australia while

the Charlton feedlot in Victoria services

the southern region.

On average the Elders feedlot operation

can have up to 6000 heifers on feed

at any time and turns off 36,000 heifers

annually to supply the 60-day grainfed

beef supermarket supply chain.

The senior manager of Elders feedlot

operations, Tony Fitzgerald, said that

the organisation focused heavily on

animal welfare practices with the selection

of female cattle and their management

from the source of supply to

delivery to the abattoirs located at Wagga

in the south and to Warwick and

Kilcoy in the north.

How Elders females

make the cut

The Elders feedlot

operation focuses

on all animals

in the feedlot

achieving optimal


He said the Elders feedlot operation

focuses on all animals in the feedlot

achieving optimal performance.

However, with female cattle representing

up to 40 percent of the cattle

turned off annually, achieving optimal

performance across the female intake

was a critical factor in productivity and

cost efficiency for the organisation.

Mr Fitzgerald said when purchasing

female cattle, Elders preferred to source

cattle with British type genetics, as this

allowed the organisation to more easily

comply with MSA requirements in line

with its customers’ needs – although

some cattle with a Bos Indicus content

of less than 40pc are also purchased.

Another major cornerstone in achieving

optimal performance for female

cattle in the feedlot was in the use of a

pre-vaccination program.

Elders prefers all female cattle

delivered to the feedlot to be Feeder

Guard accredited.

The Feeder Guard program requires

suppliers to vaccinate cattle with three

vaccines twice at specified intervals to

combat specific illnesses in cattle. The

use of Bovilis MH vaccine reduces the

risk of Mannheimia haemolytica respiratory

disease (BRD), Pestigard vaccination

to fight bovine viral diarrhoea

virus (BVDV), and five-in-one or sevenin-one

vaccination to manage illnesses

from various clostridial diseases.

● To p20

18 LOTFEEDING, July 2012




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LOTFEEDING, July 2012 19


● From p18

The Feeder Guard program

is accredited and

audited by AUS-MEAT and

in 2010 it had 480 members

in Australia.

Mr Fitzgerald said that,

if any feedlots in Australia

were experiencing issues

with BRD and BVDV in

their feedlots with female

cattle, he would encourage

them to adopt the Feeder

Guard program. In addition

we have some clients that

vaccinate with two shots of

Bovilis MH + IBR which has

proven to be successful.

Mr Fitzgerald said the

sourcing of female cattle directly

from the paddock and

backgrounded by proven cattle

producers was a number

one priority.

“Cattle are purchased

through the saleyard system

when fundamentals require

us to do so, but this is our

least desirable option due to

implications on performance

and health,” he said.

Elders preferred to source

cattle as nearby the feedlot

operations as possible to

reduce the risks of stress

from transport and different

climatic conditions.

However, securing suitable

cattle close to feedlots is

not always possible and risk

management is important.

Mr Fitzgerald said that

the Killara Feedlot mainly

procured female cattle from

Roma in the north to Forbes

in the south and westward to

Nyngan. The Charlton feedlot

operates across southern

parts of NSW, Victoria and

eastern SA.

Mr Fitzgerald said cattle

buyers for the feedlot have a

policy of not purchasing

female cattle that may be

pregnant. However, at times,

determined by the season,

cattle are pregnancy tested

at induction, particularly at

Charlton Feedlot.

Heifers are screened for

pregnancy using an ultrasound.

Any pregnant heifers

detected are either returned

to their place of origin or accumulated

at the feedlot

holding paddocks to be sold


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Elders’ feedlot operations turn off about 36,000 females annually to

supply the 60-day grainfed supermarket trade.

at local cattle auctions.

Most female cattle procured

by Elders have a stipulated

live weight range from

320 to 400kg and the age on

intake to the feedlot is with

milk teeth only – under 16

months. Generally the female

cattle received by road

transport at the feedlot are

weighed and placed on hay

overnight. The next day the

cattle are processed and

placed into their home pens

with more hay and starter

ration. Female cattle are

held in pens separate from

the male cattle and preferably

kept with a minimum of

vendors to reduce stress

from co-mingling.

Mr Fitzgerald said Elders

uses five standard rations

but domestic female cattle

are only fed the first four

with the fat depth of the

carcases generally managed

at the procurement stage to

minimise cattle being too

forward before entering the


Mr Fitzgerald said Elders

uses a budgeted target

weight gain for heifers

based on intakes of 12kg of

feed as fed for a weight gain

of 1.8 kilogram per head per

day, keeping in mind performance

varies through-

out the year.

Heat stress was an issue

for all cattle and every

September Elders reviews

the heat load plans and has

meetings with key staff

ensuring all contact details

are updated in the plans including

veterinarians, nutritionist,

managers and stake


The feedlot services two

weather stations and checks

that the required level of

training of staff has been

undertaken to ensure competency

on heat load, heat

load calculations and the

correct recording protocols

are in place to identify

imminent heat events. Management

of transport, drafting

and feeding of stock is

arranged to minimise the

risk to cattle especially during

hot weather events.

Mr Fitzgerald said female

grainfed cattle due to be

loaded out of the feedlot

were held on feed as long as

possible as Elders considers

this achieves a better carcase

result. With truck holding

tanks, this loading out

process is possible. Mr

Fitzgerald said female cattle

did not show any different

weight loss in transit

compared with steers.

20 LOTFEEDING, July 2012


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LOTFEEDING, July 2012 21



Females: achieving

optimal performance



THE Australian feedlot industry

annually turns off about 750,000

heifers which represent around

30 percent of the national lot

feeding throughput.

The importance of selecting appropriate

heifers for the feedlot and their

management while on feed is critical to

achieving the highest productivity.

Dr Mathew George, managing director

of Bovine Dynamics, Brisbane,

recently discussed some of the factors

that feedlot managers should consider

when feeding female cattle.

Dr George said heifers were generally

destined for domestic feeding

The importance of

selecting appropriate

heifers for the

feedlot and their

management while

on feed is critical.

programs in Australia. Upon entry into

the feedlot they were lower in average

weight than many of their steer brothers,

which may be utilised in an array

of domestic and export programs.

Heifers, therefore, were on average

younger than many steers fed and

therefore tend to be immune-naive, enhancing

the benefit of preconditioning

programs, especially with heifers.

Dr George said an array of backgrounding

pre-feedlot vaccination programs

are suitable; however he

recommends these programs should

concentrate on cattle receiving:

● Two doses of a seven-way Clostridial

bacterin (seven-in-one).

● Two doses of an M. haemolytica

bacterin vaccine 28 to 42 days apart

within six months pre-feedlot entry.

● Either two doses of a killed IBR

(infectious bovine rhinotracheitis) vaccine;

or a single dose of a modified live

IBR vaccine. While frequently this last

modified live vaccination will be administered

at the feed yard, in general

earlier pre-feedlot vaccine administration

should have a favourable impact

on immunological programming.

● A broad spectrum anthelmintic.

Given the past three years of above

average rainfall, we have noted in a

recent 2011 Bovine Dynamics Faecal

egg count and larval culture survey (20

feedlots, 60 pens) sponsored by Pfizer

Feeder Guard Managing Bovine

Respiratory Disease at the farm gate

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Bovine Respiratory Disease is estimated to cause between

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membership program, available to cattle producers who supply feedlots.

It is a prescribed pre-induction protocol treating beef cattle, prior to entry to the feedlot, as a result

FeederGuard anticipates producers will receive price premiums payable by the feedlot.

For further information about Feeder Guard contact Adrian Whitty on 0428 693 542

or email

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Helping Combat BovineRespiratoryDisease

22 LOTFEEDING, July 2012


Animal Health increased worm

burdens, especially in saleyard-sourced

cattle. More than 30pc of cattle

surveyed had worrying egg counts

where anthelmintics had not been

administered at the feedlot.

Cooperia spp., especially from northern

Australia, has been extensively

documented to depress immune function.

Conversely, those cattle sourced from

structured preconditioning sources had

significantly lower egg counts and all

returned negative larval cultures.

Dr George suggested another factor

that needs to be considered when

sourcing heifers for the feedlot is the

distance the female cattle will need to

travel – ideally the shorter the distance

from source to the feedlot, the


Where longer distances are involved

the cattle can suffer deleterious effects

concerning health and performance.

Apart from the issue of distances

from the source of the cattle to the


feedlot there can also be changes in

climate that may exist from one region

to another. ● To p30

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ALFA Lotfeeding

LEADING feedlot researcher of

international renown Dr Michael

Galyean has told lotfeeders and

nutritionists at a seminar in

Dalby, Queensland, that feedlot nutritionists

in Australia should consider

degradable intake protein in feedlot

diets to assist gain.

The visiting nutritionist from Texas

Tech University said most feedlot diets

in the US were based on steam-flaked

corn containing 13 to 13.5 percent

crude protein with a minimum of 8pc

degradable intake protein (DIP) to

optimise performance.

He said cattle in Australia do not

have a deficiency of DIP on steamflaked

barley and wheat diets;

however, he advocated that cattle gain

and efficiency could possibly be improved

by providing undegraded intake

protein (UIP) supplementation to

these cattle to boost performance. He

said the use of UIP supplementation

had not been researched in Australia.

Programming the best method

Dr Galyean also reviewed data conducted

at Texas Tech University which

indicates that total dietary neutral

detergent fibre (NDF) and/or roughage

NDF is the best method for exchanging

roughage sources in feedlot diets.

Dr Galyean was the keynote speaker

at this year’s Nutrition Service Asso-

● From p17

There are some measure Australian

end users can use to follow the

export sales pace for Australian

grains. The first is, of course, following

the monthly export statistics tracking

the export pace for Australia grain.

However, there is a time lag in

using this measure with the official

government data not published until

six weeks after the end of the month.

The Australian Bureau of Statis-

US researcher

talks up protein

Dr Michael Galyean

ciates seminar in Dalby on May 29. He

is Professor of Animal Science at Texas

Tech University and is widely acknowledged

as one the leading feedlot

researchers in the world. He also has

held the esteemed positions of editor

and chief of the Journal of Animal

Science and is a former president of the

American Society of Animal Science.

The seminar’s speaker list also

included Dr Joseph McMeniman, of

Nutrition Service Associates who

reviewed data that suggests lesser

known mineral deficiencies are possibly

more prevalent in australian feedlot

diets than originally thought.

“A lot of data has been published on

the phosphorus and cobalt deficiencies

in Australia, which is a wide problem

with approximately 70pc of northern

Australia defined as phosphorus deficient,”

he said. “Lesser known mineral

deficiencies such as sodium and copper

are widespread in Queensland and

northern NSW, according to a forage

analysis database of NSA.

“Additionally, high dietary iron is

also likely limiting the absorption of

tics also publishes monthly wheat

export commitments report. This

gives a snapshot of the wheat sales

that major exporters have made but

are yet to be shipped on a state basis.

This survey says there is currently

6.3 million tonnes of wheat, about a

third of the latest bulk handler wheat

stocks, has been sold that is still to be

A lot of data has

been published on

the phosphorus and

cobalt deficiencies

in Australia, which is

a wide problem.

Cu and Zn by animals, which may have

implications for the immune status of

animals entering a feeding program.

“Although I am not recommending

all cattle are supplemented with

minerals during the wet season, I do

believe that when combined with an

ionophore such as Monensin, Lasalocid

or Bambermycins, there would be a

positive return on investment across

much of Queensland to utilisation of

wet season mineral programs.”

Forum takes scientific focus

The conference was well attended,

with 85 attendees from the feedlot,

grazing, abattoir and technical service

industries. Now in its second year, the

NSA seminar is an annual free event to

provide current scientific information

to the Australian beef cattle industry

on nutrition and management.

“We aim to bring highly qualified

international and Australian speakers

to talk to the beef industry in Dalby

and Wagga Wagga, NSW, each year,

with the support of our commercial

sponsors,’ Dr McMeniman said.

“Anyone in the beef industry is

welcome to attend.”


shipped, which is close to a record

high. The other measure that provides

a valuable insight to exporter

activity is the shipping stem pace.

Admittedly this is not an easy task

as it usually involves the painstaking

task of tracking individual grain

vessels which is cumbersome and not

always rewarding.

24 LOTFEEDING, July 2012

LOTFEEDING, July 2012 25



Tajima Wagyu steaks

claim to be Aussie best




ALFA Lotfeeding

THE Tajima Fullblood Wagyu has

been crowned Australia’s best

steak in the nation’s most prestige

branded beef competition as

part of the RNA’s Royal Queensland

Food and Wine Show (RQFWS) in


The New South Wales Wagyu took

out the champion title beating a high

class field of record entries while New

England Gold by Country Fresh

Nationwide won the title of the

nation’s best lamb.

RQFWS chief judge Russell Smith

said the standard of entries for the

branded beef and lamb competitions

highlighted industry trends towards

a more uniform, tender and flavoursome


He said the New England Gold winning

lamb nudged out other entries

due to its above average flavour profile.




Kilroy Cha Cha Char Champion Branded

Beef of Show

* Tajima Fullblood Wagyu exhibited by Andrews

Meat Industries from Lidcombe in New South


Champion MSA Graded (Non Wagyu)

Branded Beef of Show

* Highland Park Grassfed Beef exhibited by Aldi

Stores from Minchinbury, NSW

Lend Lease Grainfed MSA Graded

* Gold: Stockyard Gold exhibited by Stockyard

from Brisbane in Queensland.

* Silver: Drover’s Pride exhibited by Australian

Country Choice from Morningside in


* Bronze: Kimberley Red exhibited by Signature

Beef from Clermont in Queensland

Lend Lease Grassfed MSA Graded

* Gold: Highland Park Grassfed Beef exhibited

“The overall

quality of the

lamb exhibits

was superb with

the texture and

feel outstanding,”

he said.

“This consistency

of product

quality is what

the red meat industry

has been striving for over the

past decade.”

Mr Smith said the Tajima Fullblood

Wagyu from Andrews Meat Industries

displayed a beautiful balance between

the fat marbling and the background

flavour of the meat.

“It’s a brilliant example of Wagyu

for consumers who want to experience

the best the breed has to offer,” he said.

Andrews Meat Industries export

manager Jeremy Stuart travelled from

the company’s Sydney base to accept

the award, regarded as the pinnacle of

branded beef accolades in Australia.

A record 28 companies entered products

across the classes this year, providing

judges with 40 entries to taste

across two days to ultimately award

by Aldi Stores from Minchinbury in NSW

* Silver: Manning Valley exhibited by Wingham

Beef Exports from Wingham in NSW

* Bronze: Cape Grim Tasmanian Natural Beef

exhibited by Greenham Tasmania from

Melbourne in Victoria

The Australian Wagyu Association Wagyu

Class – AUSMEAT Marble Score 1 to 5 –

MSA and Non-MSA

* Gold: Darling Downs Wagyu exhibited by the

Australian Agricultural Company from Brisbane

in Queensland

The Australian Wagyu Association Wagyu

Class - AUSMEAT Marble Score 6+ – MSA

and Non-MSA

* Gold: Tajima Fullblood Wagyu exhibited by

Andrews Meat Industries from Lidcombe in


* Silver: Master Kobe exhibited by the

Australian Agricultural Company from Brisbane

in Queensland

* Bronze: Stockyard Black exhibited by

Stockyard from Brisbane in Queensland

ANZ Agribusiness Open Class – Non-MSA

This consistency of

product quality is

what the red meat

industry has been

striving for over

the past decade.

the best retail beef and lamb on the

Australian market.

Not only did this year’s Branded

Beef competition boast Australia’s

largest number of entries, but it also

introduced a new class for Wagyu,

which separated beef based on the

marble score, and a new trophy in

recognition of the number of MSA


Adding to the prestige of the champion

title, the award-winning Tajima

Fullblood Wagyu will also have the

opportunity to feature on the menu of

Brisbane’s renowned Cha Cha Char

Wine Bar and Grill restaurant.

Competition winners earn the right

to display their gold, silver or bronze

26 LOTFEEDING, July 2012

and Organic

* Gold: Royal Beef exhibited by JBS Australia

from Dinmore in Queensland

* Silver: Spring Grove Non-MSA Australian Beef

exhibited by Atron Enterprises from Wahroonga

in NSW



Branded Lamb of Show

* New England Gold exhibited by Country

Fresh Nationwide from Newstead in


Meat and Livestock Australia Branded

Lamb MSA and Non-MSA

* Gold: New England Gold exhibited by Country

Fresh Nationwide from Newstead in


* Silver: Sovereign 5-Star exhibited by

Sovereign 5-Star Lamb from Mansfield in


* Bronze: Tasmanian Royal exhibited by

Melrose Wholesale Meats from Sherwood in


medal on product packaging, ensuring

consumers know they are buying the

best of the best in that product range.

A delighted Mr Stuart said the

award couldn’t have come at a better

time as Andrews Meats begins a major

shift in the marketing focus of their

Wagyu products, which will see the





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Tajima brand dropped from the fullblood


“We currently market both our fullblood

and crossbred Wagyu programs

under the Tajima brand, however

starting from next month the fullblood

Wagyu program will be rebranded

under the Shiro Kin Fullblood Wagyu

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Andrews Meat Industries export manager

Jeremy Stuart shows his elation when

accepting the award for Australia’s best steak

in Brisbane on Tuesday.

brand. The main reason for the rebranding

is to avoid any confusion in

the marketplace about our Wagyu programs

and maintain the integrity that

the programs have been built around.”

Currently exporting to key destinations

in Australia, Asia, North America

and the Middle East, Andrews Meats

works with specialised producers in a

vertically-integrated model.

This allows the meat wholesaler to

control the product – literally from

paddock to plate.

Mr Stuart said vertical integration

had allowed the family company, established

more than 50 years ago from a

small butcher shop on Oxford Street in

Sydney, to achieve a self-sufficient

supply chain of premium products.

They are sourced from farm-run

programs to the end customers of their

client base ranging from hotels, clubs

and restaurants to healthcare, airline,

corporate and industrial contract

caterers, as well as retail.

“Our marketing strategy over the

past 15 years has focused on diversity

of product, developing niche farming

programs and brand ownership,” Mr

Stuart said.

“This has been achieved by establishing

long term relationships with

specialised producers and effective

product placement with clients.

“Owning the brand and distribution

process not only offers our clients high

quality products with a point of differentiation,

but also ensures a consistent

supply chain from farm gate to the end

user. ● To p29



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LOTFEEDING, July 2012 27


ALFA Profile

Graham truly at

home at Kerwee


GRAHAM Turner is the manager

of the maintenance division at

Kerwee Feedlot at Jondaryan on

the Darling Downs in Queensland.

Prior to Graham joining the Hart’s

family farming enterprise, he gained

an enormous amount of experience in

different fields of agriculture.

Graham started his career serving

time as an apprentice motor mechanic

at Dalgetys Kingaroy, working on

machinery, which specialised principally

on Massey Ferguson tractors.

After completing his apprenticeship,

he spread his wings and went

share farming. Following this experience,

Graham went on to manage a

dairy in Oakey. Graham then decided

the dairy industry was not for him so

he took up the tools once again, doing a

short stint as a mechanic at Faulkner

Motors in Toowoomba.

However, working on rural properties

seemed set in his veins, which led

him to leave Faulkner Motors and

move to Tambo Station as a station

mechanic. This position presented a

life challenge. The manager committed

suicide not long after Graham arrived.

He was left to work in his new role

without a manager for about 12

months. He described the situation as

a “sink or swim exercise” which taught



● From p27

“Our main brands include Shiro

Kin Full Blood Wagyu Beef, Tajima

Crossbred Wagyu Beef, Grainge

Grainfed Angus Beef, White River

Veal, Byron Bay Berkshire Pork and

Salami by Robert Marchetti.

“All livestock produced under these

programs are distinguished by their

breed and the best-practice farming

techniques implemented on contract

properties throughout NSW, Queensland

and Victoria in which they are

produced, and importantly, where

they are raised humanely.”

him many important maintenance


When Tambo Station was sold four

years later, Graham moved to a 10,000hectare

wheat farm north of Moree,

where he worked as a farmhand.

In 1988 Graham began his 27-year

career with the Hart family. He first

worked for the family on their property

named Argyle, a mixed farming and

Santa Gertrudis stud at Kingsthorpe.

When Graham joined the Hart family

business, Kerwee owner Robin Hart

instantly recognised the skills, experience

and qualifications that Graham

brought to the enterprise, which he has

continued to display every day he has

been part of the business.

Later that year the Argyle property

was sold and the business bought an

adjoining property to their feedlot

property, Berwick. Graham worked as a

farmhand on the two properties until

1993 when the Hart family decided to

rebuild the feedlot on a new site. He

then became the maintenance manager.

During the rebuilding and two

subsequent upgrades of Kerwee Feedlot,

Graham became one of the main

players on the projects, from the design

stage through to the final completion

and daily operation.

His experience before joining the

Hart family enterprises, coupled with

his hands-on experience redeveloping

and working at Kerwee, has given him

Animals in the fullblood Wagyu

program, to be marketed under the

Shiro Kin label from next financial

year, come from AI and natural mating

of Shimane and Kedaka fullblood

females with Tajima fullblood sires.

HGP-free feeder cattle are entered

into Macquarie Downs Feedlot for a

minimum of 500 days on GMO-free

rations before being processed at

400kg to 450kg at Northern Co-operative

Meat Company, Casino, NSW,

in a halal-accredited operation.

the ability to be an excellent mentor to

staff at Kerwee.

He manages up to 10 employees

during normal duties, in areas of pen

maintenance, plant maintenance, feed

mill operations and farm management.

When Jim Cudmore, manager of

Kerwee Feedlot and ALFA president, is

away from the feedlot, Graham is the

man in charge.

He has passed on his considerable

knowledge in mechanics and maintenance

to many new recruits at Kerwee.

Some of the staff have worked with

him there for 20 years.

Graham takes a lot of care to

explain – particularly to young people

starting out at the feedlot – how the

machines work and what parts of the

machines to check for wear and tear.

At Kerwee he was also instrumental

in helping Kevin Wilson complete his

motor mechanic apprenticeship.

Kevin can now act as backup

The RNA’s chief judge Russell

Smith said competitions like the

Royal Queensland Food and Wine

Show Branded Beef and Branded

Lamb assisted Australian consumers

and producers.

“Australians quintessentially love

a barbecue, so it’s great to know what

the best of the best is,” he said.

“We also have quality farmers and

producers in the industry who deserve

to be rewarded and recognised

for their excellence.”

The hunt for the next two ‘best of

the best’ continues with the Royal

Queensland Wine Show and Sausage

King Competition in July, as the RNA

continues its quest to find Australia’s

best wine and Queensland’s best


28 LOTFEEDING, July 2012

mechanic for Graham, and Kerwee has

two qualified mechanics on staff.

Graham’s broad background assists

in training staff at the feedlot to

become multiskilled so when extra

manpower is required elsewhere on the

feedlot, staff can be easily moved to

other duties at Kerwee.

While Graham has accumulated

much technical know-how in feedlot

operations, he acknowledges he has

learnt a lot about people skills from

Jim Cudmore.

Graham believes the high retention

rate of staff at Kerwee reflects a

culture of respect for individuals, business

stability for nearly two decades,

coupled with providing fair working

and pay conditions for employees.

Since his time with the team that

rebuilt Kerwee, Graham has faced a

number of challenges, which he has

overcome by leaning from others, as

well as trial and error.



Your feedlot partner

In 1976, Downfields Engineering

first opened its doors and has

since grown into one of Australia’s

leading bulk grain handling and

processing specialists.

Our experience guarantees that

our clients will be supplied superior

equipment that will provide excellent

performance and reliability.

There may be

opportunities for

feedlots to rotate

qualified staff

among collaborative


In the early 1990s, Kerwee Feedlot

was among the earliest adopters of

steam-flaking technology in Australia.

Graham recounted that the success

of the process at the feed mill came

through some backup knowledge from

people in the US plus some trial and

error at the mill.

Apart from innovations such as

steam flaking, Graham says the feedlot

industry improves its business processes

every year in some way.

Other improvements witnessed

during his career include improved

heat stress management of cattle in

summer, animal pre-vaccination programs,

pen floor management using

laser technology, making compost from

solid animal waste, and cattle genetics

aimed at achieving optimal performance

in the feedlot sector.

Attracting and retaining staff at

Kerwee Feedlot has not been a serious

issue, but Graham has some views on

sharing staff resources with other feedlots,

and the creation of an indentured

feedlot apprenticeship program.

The large cattle companies such as

AACo and JBS have the opportunity

for staff to work at different feedlots.

He suggests four feedlots could form

We supply the feedlot industry with:

• Layout design assistance;

• Detailed equipment planning;

• Manufacture and supply of

equipment for the intake,

handling, storage and

processing of grains, meals

and other fibrous materials;

• Installation and service.

ALFA Profile

an agreement to share indentured

apprentices over four years.

In this arrangement, an apprentice

could work a year at each feedlot while

completing a trade in mechanics or

electrical engineering, for example, as

well as obtain all the necessary accreditations

required of feedlot staff.

“The four feedlots could all be in one

state or you could have an agreement

with feedlots in four other states,” he


“For example, the apprentice could

work in Queensland, NSW, Victoria or

WA. This would allow the apprentice to

experience different types of feedlots,

farming methods and climates associated

with the Australian feedlot industry.

Near the end of the apprenticeship,

a staff exchange for three months could

be arranged with an overseas feedlot


“Alternatively, there may be opportunities

for feedlots to rotate qualified

staff among collaborative feedlots

which are in close proximity to each

other, so staff can experience a different

working environment for a short

time and provide backup emergency

staff and skills when and if required.”

Robin Hart says Graham also has

many talents outside of feedlots.

“Graham is an extremely talented

wood carver and the Hart family

proudly displays a polished wood carving

of a Santa Gertrudis bull on their

mantlepiece,” Robin said.

“Graham has also been a very diligent

and progressive board member of

the nearby Jondaryan Woolshed.

“He’s also responsible for restoring a

beautiful Queenslander on the Kerwee

property at Bloodwood Hill that overlooks

the valley below.”

+ =

19 – 29 Enterprise Street (PO Box 6095) Toowoomba West QLD 4350 Australia

P +61 7 4634 4622 F +61 7 4633 1049 E

LOTFEEDING, July 2012 29

DOE 1548241








● From p23

Dr George suggested that

changes in climate whereby

cattle from more temperate

regions (including higher

altitude) are transported

into South East Queensland

for example can place additional

stress on cattle, especially

in November to March

feedlot placements.

Another aspect for feedlot

managers to consider in

relation to feeding heifers is

the age of the animal when

it enters the feedlot.

Dr George said that –

with greater adoption of

MSA grading

standards –


aspect for


managers to

consider is

the age.

the more youthful

the heifer,

the improved


grading and

boning group

result would



et al, 2001,


the impact of

sex differences

in dentition and skeletal

ossification in US slaughter

populations, with heifers

more rapidly increasing

carcase ossification at equivalent

dentition to steers.

However, categorically,

heifers weaned directly into

the feedlots are not acceptable.

There is no trade-off of

youth for proper yard weaning

and feedlot pre-vaccination.

Dr George said that the

risk of pregnancy with

heifers has always been and

will continue to be a significant

animal welfare and

feedlot management issue.

It is highly preferable

that heifers are pregnancy

tested prior to sale or

dispatch to a feedlot by

an accredited veterinarian

(note National Pregnancy

Identification Scheme) underpinned

by the Australian

Cattle Veterinarians (ACV).

Pregnant heifers (second

and third trimester) should

either be paddocked to calve,

or dispatched directly to


While an


agent can be


at the feedlot,

animal health

and labour

costs will be

increased and

generally feeding

results on

these heifers

are unviable.

Work completed

by Kansas

State University (Bishop

et al, 2003) reported pregnant

and empty heifers as

having similar feedlot daily

gain and conversion.

However, these authors

further characterised pregnant

heifers had carcase

weights 10kg lighter and

generated dressing percentages

2.3 percent lower

than those non-pregnant


30 LOTFEEDING, July 2012



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