FOR the people at the forefront of Australia’s foray into genuine value chain integration within beef and lamb supply, there is one key ingredient that holds the recipe together: communication.
JBS Australia’s leading farm assurance program, six years in the making, is the first of its kind in Australia and now has 3000 producers across southern parts of the country on its books.
The program delivers a fully traceable natural, grass-fed meat that meets eating quality standards every week of the year, marketed under the Great Southern brand.
Last year, suppliers received a 50 to 60 cents per kilogram premium - that added up to $30m back into the pockets of farmers.
JBS, Australia’s largest red meat processor, appears to have shifted a long way from the traditional ‘put a grid out there’ way of doing business. Today, it sees itself as a go-between, a facilitator, linking producer to consumer.
The company’s southern farm assurance and livestock supply chain manager, Mark Inglis, talked passionately about how value chain integration is the way of the future for beef and lamb at a recent national industry conference.
He outlined the reasons why JBS went down this track, and how they put the concept of greater information flow into action, at the Australian Meat Processor Corporation’s The Vital Ingredient event in Sydney.
“Ask a group of people in the beef industry what value chain integration means and you get a long list,” he said.
“More money to the producer comes up straight away but better communication through the supply chain, feedback, better direction, working towards a common goal, each sector understanding where the others in the chain are coming from, adding value to clients and customers - it’s all there.
“To us, this is what it means: A way of supplying beef and lamb that is better for the producer, for the processor, for the animal, for the environment and for the consumer.”
A chain where one sector benefits and others cop a discount simply doesn’t work anymore, he said.
“For so long, the way this industry has done business is this: You’ve got the livestock producers, the processors, the distributors, the end users and the consumers and every step of the way, a brick wall goes up. Everyone keeps everyone else in the dark,” he said.
“We wanted to do something different. We set out to break down those brick walls.
“We created a new way where JBS sits in the middle and the information flow goes out in all directions.
“Financial returns are being stretched all the way across the chain. It adds value to the whole scenario.”
Under the JBS model, farms seem to have become quite well-visited places.
“We pull back the guys who are receiving our product to the farm. We want them to meet the producer,” Mr Inglis said.
“We have recognised the growing consumer demand for high-quality grassfed beef but they need the confidence and understanding of exactly where their product comes from and how animals are being treated.”
Chefs, overseas buyers - and even the boning room itself - are finding their way to the farmgate.
“The really interesting and exciting part of what we’ve done is creating closer working relationships with producers,” Mr Inglis said.
“In the past we have just thrown a grid out there and said ‘right-o, you guys supply to that’.
“Producers are looking for more. They are proud of what they do and they are looking for an interaction with the processor and the customer.
“All they need is the vehicle to do it.”
The assurance scheme’s boning room on wheels, complete with a cool room and a barbie, has appeared at 90-odd producer days this year.
“We also benchmark producers and celebrate producer achievements,” Mr Inglis said.
“Feedback must be robust so they know why they have missed a target.
“This is information producers crave.
“We also know there are issues around supply of grassfed beef at certain times of the year so what we have done is set up key research and development groups, in partnership with Victoria and NSW DPI, consultants and MLA, to work on supplementation, forage crops and other areas in order to get that 365 days of the year consistent supply.
“A processor needs to know the producer as well as the customer.”
What all that has added up to, according to Mr Inglis, is the ability to consistently supply a
grassfed premium, natural article, where the producer is involved, it’s exclusive and it has integrity.
“You need a product that stacks up to expectations, that performs in the market,” he said.
“All the claims in the world meaning nothing without that.”
Great Southern’s supply is consistently in the top five to 10 per cent for eating quality in Australia.