Gunnedah

Located north east of Wagga Wagga. Originally Gunnedah was a service abattoir owned and operated by the local council. It increasingly developed serious debt problems and received a number of assistance packages from Federal and state government to maintain operations. Sold to private enterprise in 1996 it only operated a very short time before permanently closing in 1997.

Other Names

Current Operation

  • Closed 1997.3

Location   

  • Gunnedah is located in northern NSW, approximately 550 km north of Sydney

Gunnedah

Gunnedah 2

Hema Maps – Australia Truckies atlas.

Owner

  • Gunnedah Shire abattoirs1
    • Manager Ray Grout1
  • Edmonds Meat Exports3 (1996 – 1997
    • Manager Peter Spackman3

Operation   

  • Export abattoir1

History

1957

  • Gunnedah abattoir established.4
    • One of four strategic local government abattoirs4
    • Set up by state government to boost local employment and offer processors and producers their own regional selling centre.4
    • Gunnedah was the most successful and once described as the shining light of the meat processing industry4
    • At its peak the abattoir through service operators had 600 employees.4

1994

  • One of Australia’s biggest export abattoirs1
  • April. Ray Grout gave notice of resignation, council accepted but then Ray Grout wanted his job back and it was refused.1
    • Ray Grout won the right for reinstatement as Gunnedah abattoir manager then changed his mind1
      • claimed $100,000 damages.1

1996

  • April. Facility had soaked up $1.8M in council support since 19932
  • Currently employs 200 people2
  • Fallen on hard times8
    • partly due to effects of extended drought in northern NSW8
    • abattoirs lack of meat industry experience8
  • Delivers $150M into the regional economy each year.2
  • Report conducted by Price Waterhouse findings2; to determine the role the abattoir played in the regional economy and to see if there was any hope of returning it to profitability8
    • Recommended abattoir be corporatised and assets transferred to a seperate legal entity8
    • Independent board with meat industry experience8
    • abattoir to be sold at any reasonable offer or closed if the business remains unviable and sale is unlikely within 2 years8
    • package of state and Federal government assistance8
    • Acknowledged plant was uncompetitive2
        • but could be salvaged under new management if it corporatised for preparation for sale within 2 years.2
        • Federal government received  $1.25M in quarantine service fees and $2.5M PAYE each year2
  • State and Federal government deal to prop-up facilities operations.2
    • $2.1M. in total2
      • $1.1M. exemption from payroll tax and stamp duty2
      • $1M. Quarantine and hygiene inspection costs pickup up by Commonwealth.2
      • Gunnedah was the most strategically placed in eastern Australia2
      • Gunnedah was one of only 5 abattoirs licensed to export to the 5 key export regions2
  • Describing the problems at the abattoir2 as an
    • “example of everything that is wrong in Australia’s meat industry” – John Carter, Former head of NSW Meat industry authority.2
    • “The situation at the Gunnedah works is indicative of the endemic problems that seriously threaten the competitiveness of Australia’s second largest export industry” – John Carter.2
    • Last week Australia utilised just 69% of its killing capacity compared to the US, which was working at 200% by doubling its shifts – and we wonder why we are failing to compete” – John Carter.2
    • 200 abbatoirs must be cut to around 50 if we are to be competitive” John Carter2
  • May. $1M assistance package is put in place.6
    • $1M over a 2 year period by state8
    • Federal government gave some concessions on quarantine and inspection services8
      • Council implement recommendations of Price-Waterhouse report – included appointing a new board.6
        • Greg Upton – Grazier and Chairman of North west electricity6
        • Jason Strong – Chairman of the Cattleman’s union and National livestock marketing board.6
        • Authors Note – Not sure if this is the same man. Jason Strong appointed Chief Executive of Australian Agricultural Company in 20145
      • 4 companies have approached council about establishing operations in Gunnedah6
        • included on of the worlds largest corporations.6
  • Up to half of NSW 56 abattoirs could close with the loss of up to 5,000 jobs7

    Authors Note – Majority of live export cattle during this period would have been Bos Indicus or crosses to South East Asia markets, sourced from mainly northern Australia. Not animals suited to heavy slaughter in Australia and from herds whos’ production was not likely destined for abattoirs in NSW.

    • LE exports 1990_1998_edited-2Source – Live Cattle Exports. Australian Commodities Vol 5 #2 June 1998

     Chart showing the high volume of South East Asia live cattle export destinations period 1990 – 1998

  • State government concessions designed to prop up the ailing Gunnedah abattoir were hastening their demise.7
    • forced other abattoirs to compete with inefficent works being handed unfair trading advantage7

    December. Abattoir sold to Edmonds Meat Exports.3

 

 1997

  • April. Plant offically reopened.8
    • Record kill levels 30% above council management8
    • Hope new abattoir will expand into sheep, pigs with a view to new exports in Europe8
  • Other retailers have set up in Gunnedah – McDonalds.8
  • Turkish investor is interested in Gunnedah tannery for purchase and expansion8
  • Abattoir now has $10M debt.8
  • 370 workers put off3
    • mostly casual staff3
    • Not sacked , when market improves would endeavour to re-employ3
  • Plant was paying more for cattle but getting less for product  when it was sold overseas3
  • Companies decision was inevitable and would have come even if the meatworks was not privatised3
    • had been expected for a while due to conditions in the industry3

Sources

  1. ‘Legal dispute over dismissal or resignation’ Sydney morning herald. 23.11.1994
  2. ‘Call to Scrap $2.1M abattoir rescue plan’ Sydney morning herald. 08.04.1996
  3. ‘Abattoir shutdown a jolt for Gunnedah’ Sydney morning herald 14.10.1997
  4. ‘A giant in the life of Gunnedah – 100 years since O’Keefe born’ Namoi Valley Independent 23.10.2012
  5. ‘Strong happy to shoulder the load’ Stock and Land 24.04.2014
  6. ‘Gunnedah shire abattoir’ Parliamentary Hansard, 14.05.1996
  7. ‘5,000 jobs at risk: Abattoirs facing closure’ Sydney morning herald. 21.05.1996
  8. ‘Gunnedah shire abattoir’ Parlimentary hansard 17.04.1997

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