AACo finds taste for boxed beef

AUSTRALIAN Agricultural Company’s shift towards exporting packaged meat will cushion it from the fallout from Indonesia’s massive cut to live cattle imports.

Indonesia has reduced the quota of live cattle imports to 50,000 in the three months to September, down from 250,000 in the preceding quarter.

AACo’s transformation from a cattle producer to a boxed meat exporter has created a more robust business, shareholders were told at the company’s annual general meeting in Brisbane yesterday.

“As Indonesia’s recent decision to reduce live cattle imports demonstrates, product and market diversity is important,” the group’s chairman Donald McGauchie said.

Since Australia temporarily banned live cattle exports to Indonesia in 2011, AACo has been growing its business in the boxed beef market.

The company spent $ 91 million building the Livingstone Beef abattoir in Darwin, which was opened in February. It will process up to 1000 head of cattle a day at full capacity.

AACo managing director Jason Strong said the volume of cattle processed at the plant was increasing to meet demand.

“We are in an environment now where we have strong global demand for proteins, particularly for beef,” he said.

“In the grass fed part of the business, we made a strategic decision to substantially reduce the number of cattle sold externally and this process will continue in 2016.”

Boxed beef accounted for 77 per cent of revenue in fiscal 2015, up 18 per cent. Wagyu beef accounted for 52 per cent of its boxed beef revenue.