WA Meat Marketing Co-operative defies COVID complications to post an $8.10 million profit turnaround

WA lamb producers are on a hat-trick with WA Meat Marketing Co-operative posting a record consolidated turnover of $390 million and a healthy net $8.10 million profit.

The Katanning-based co-operative unveiled the results at its annual general meeting in the Great Southern town last Wednesday.

WAMMCO chief executive Coll MacRury revealed the average price paid to producers for lamb last season was an “outstanding” $174.21 per head.

He also flagged the business could set a new lamb procurement price record this season on the back of surging livestock prices.

Mr MacRury addressed the 40-strong crowd virtually from New Zealand, saying it had been a “difficult but successful” year for the business.

He said “very good returns” allowed WAMMCO to pay a $2 million pool bonus to producers, including 20¢/kg for qualifying lambs and 10¢ for mutton.

“We processed 1.75 million stock units for 2020-21 at Katanning and Goulburn,” he said.

“The average price paid to producers for lamb last season was $174.31/head.”

WAMMCO’s Katanning abattoir is one of two run by the business, alongside the NSW-based meat processor Southern Meats in Goulburn it acquired in 2011.

Livestock throughputs were strong at Katanning and Goulburn, with what Mr MacRury said was a focus on controlling “fixed and variable costs” successfully.

“We achieved record daily throughput through the plant during peak processing times,” he said. “Livestock prices will remain strong.

“I believe as long as market forces remain where they are at present, we will see WAMMCO set a new lamb procurement price record this season.”

Mr MacRury also hailed the introduction of Dual Energy X-Ray Absorptiometry technology as a way to “extract superior yields” from high value cuts.

“We will be assessing very seriously the introduction of robotic lamb cutting in the next year or two,” he said.

“I believe we have to go that way (robotics); it’s the way of the future.

“A lot of this technology will do all the hard work that has been traditionally done by manual labour.”

Mr MacRury said WAMMCO’s livestock, processing and marketing divisions were all performing strongly, but shipping and logistics would remain a major challenge.

“With world shipping delays over the last 18 months, we’re managing to get the produce to market but not without the painstaking time involved,” he said.

“With shipping and labour the major challenges, it is good to see our key market forces starting to align quite nicely.”

I believe as long as market forces remain where they are at present, we will see WAMMCO set a new lamb procurement price record this season.

WAMMCO joined forces with two Australian and three New Zealand processors in 2003 to gain a foothold in North America by forming The Lamb Company.

“Our investment and control in this market cannot be understated and will continue to deliver superior revenues,” Mr MacRury said.

“The Lamb Co-operative model is continuing to drive our revenue on the top-end cuts.”

Mr MacRury said it had been a long time since he had seen market forces working together so well.

“We believe suppliers can be very optimistic about this current season,” he said.

Surging demand for antibiotic-free, grass-fed and pasture-raised meat was not expected to falter any time soon.

“This is where we are going to get the biggest growth,” he said.

“We are going to have to transition more of this lamb into that market.”

Mr MacRury said demand for pasture-raised meat — with higher levels of omega-3 fatty acids — had made it difficult to price match with “conventional lamb”.

“It is very much a two tier pricing market and we are going to see this gap open up in this market in years ahead,” he said.

“I encourage producers to get behind it.

“It is vital we don’t go short of these markets and let opposition have a chance at it.”

Mr MacRury acknowledge Geoff and Linda Bilney as key suppliers who delivered lambs in the off-peak times and consistently 52 weeks of the year.