Part of the reason this study has been planned links back to allegations of collusion at the Northern Victoria Livestock Exchange, which resulted in a senate investigation in March 2015.
“Competition and consumer issues in the agriculture sector are a priority for the ACCC,” said its chairman Rod Sims in a statement published on Tuesday 5 April.
“The cattle and beef market study is the first of several agricultural market studies that the ACCC will conduct over the coming years. A number of ACCC commissioners and I will be closely involved in the market study, including at the public forums.”
Body to investigate unethical trading
Key issues to be explored in the study include: competition between buyers of cattle and suppliers of processed meat to downstream customers; the implications of saleyard attendees bidding on behalf of multiple bidders; the transparency of carcase pricing; and roadblocks to the entry and expansion of the cattle market, among other issues.
The ACCC has also been awarded AU$11.4m in public funds to establish an Agriculture Enforcement and Engagement Unit that will be tasked with investigating unfair trading practices in the agriculture supply chain.
The first part of the study into trade issues within the red meat sector will include public forums held across the country by the ACCC, which wants to hear about wrongdoing from interested parties.
Retribution ‘fear’
The body has said it recognises that not everyone will be willing to come forward with information – for fear or reputational or financial damage – and as such, will accept confidential written submissions.
“We understand that some market participants may fear retribution from commercial partners for speaking to the ACCC,” said Mick Keogh, the ACCC’s commissioner. Equally, firms may be reluctant to provide the data we need to understand the complete picture.
“Therefore, we have established a strong confidentiality regime to assure interested parties that we will treat any confidential information sensitively. We will also accept information from anonymous sources.”
Andrew Fuda, CEO of leading Australian beef processor Western Meat Packers Group, welcomed the ACCC announcement, and said a 30-year-old family-owned company such as WMPG, which processes about 2,000 head of cattle a week and employs 320 people, had long standing, strong and collaborative relationships with its cattle producers.
“WMPG welcomes competition in the marketplace. Our focus has always been on ensuring we build and maintain mutually beneficial relationships with suppliers and export and domestic customers. That way, it’s a win-win for all parties, including consumers.”