Tag Archives: JBS processors

Bordertown

Australian Abattoirs, South Australia 19/11/2013 Leave a comment

Other Names

 

Current Operation

  • Aus Meat Accreditation registration dated 29/12/2015 #1614 – JBS Australia Pty Ltd (Bordertown).8
    • registered as a Sheep export facility.8
  • Direct employment enquiries to www.jbssa.com.au

Location   

  • Bordertown is located 270km south east of Adelaide in South Australia

Hema Maps – Australia Truckies atlas.

Owner

Operation   

  • Establishment # 1614
  • Lamb, Hoggets and mutton1
  • Employs 4001
  • Daily capacity 5,200 head1

History

2009

  • JBS buy plant operations2
  • Invested $6.5M on robotic technology on the kill floor2

2012

  • JBS Australia split into two operating entities to make Northern and Southern regions in relation to abattoirs and feedlots within those areas5.
    • South – Victoria, South Australia and Tasmania5
    • North – NSW and QLD.5

2013

  • Sept. Launches own brand – Great Southern2
  • Oct. Will introduce a second shift of operation2
    • increasing throughput from 4000 to 8000 sheep and lambs a day2
      • current livestock purchases are $140M per year3
      • Utilites including power and water currently $3.1M per year3
    • employing 150- 180 more permanent staff2
      • Wages budget is $25.2M3
      • Extra shift will increase wages by 40%3
      • Extra shift  and business decisions will provide continuity of employment through the year3
    • needed due to improved access to China and increasing demand for high value chilled and frozen lamb in European Union and USA2
    • Looking for financial supportfor on-site cold storage – project costing $12M3
  • Local town looking to improve its houseing and infrastructure to support new workers2
    • Priority to Migrant support servicesand re-opening of Migrant resource centre2
  • “High cost of meat processing in Australia was a constant challenge – at about 2.5 times the cost of the US” – and while technology and training added to efficencies, the state and Federal governments need to provide direct financial support to investments such as JBS are making” John Berry ( JBS director)2
  • “..with a high percentage of our product destined for hihgly competitive international markets and competing against animal proteins from around the world” John Berry (JBS)2
  • Installation of automated prcessing technology3
    • $6.5M – x-ray primal saw machine in boning room3
      • determines dimensions of major bones before moving along the chain past rotating blades, cuts the carcase into forequarter, middle, loin and leg sections3
      • Process up to 10 lambs a minute3
      • cutting tolerance of 5mm3
      • is just one of two machines in Australia3
  • Middle machine will be first of its kind in Australia when installed.3
  • November. JBS Swift Australia install closed-circuit television camera’s (CCTV) in it’s Australian meatworks.10
    • For the purpose of animal welfare and meatworker safety issues.10
    • CCTV for internal use by only JBS, with no plans to allow outsiders to view the footage.10
  • JBS’s US beef division (which includes Australia) delivered drop in net sales and earnings in it’s third quarter financial results.10
    • Australia’s division performance and overall contribution to the overall result is impossible to distinguish due to inclusion with US and Canadian beef processing results.10
    • Earnings before tax $134M,.10
      • Down by 22.5% on previous quarter.10
      • Down by 28.4% on third quarter last year.10
    • result reflection of domestic North American markets.10
      • Improved performance had occured in Australian.10
        • Demand had increased in Chinese markets.10

2014

  • July. Expected to replace two dimensional x-ray imagery with Dual Energy Xray Absorption (DEXA)4
    • Will find the skeleton but at the same time produces a lean meat yeild estimate4
  • July. JBS Australia across all facilities in operation kills daily5
    • 8,500 cattle,5
    • 24,000 smalls – which includes lambs5
    • Employs more than 8,000 people5
  • July. JBS Australia purchase majority shareholding in NSW based Andrew Meat.11
    • specialise in high quality, portion cutting and further processing of meats for domestic and international restaurant and foodservice customers.11
    • produce ready-cooked meals.11
    • company banner Creative Food Solutions.11
    • Andrew Meat will allow JBS expansion into high growth retail and value-adding segments.11
  • Expansion of the Andrew Meats business will start in November .12
    • JBS global strategy to expand into value added meat protein – opportunity to expand margins.12
    • JBS have an existing value-added division – Food Partners.12
      • supplies food service customers like Pizza Hut and Domino’s with toppings.12
    • Andrew Meats focus will be produce ready meals.12
      • ‘grab & go’ beef roasts, designed to compete head on with hot cabinet roast chickens sold in supermarkets.38
      • Domestic markets were very immature but also with significant growth potential.12
  • At this time JBS operate.11
    • 10 processing facilities.11
      • Daily processing capacity of more than 8,000 cattle and 21,000 small stock.11
    • 5 feedlots.11
  • December. JBS currently operate 12 meat processing plants across 5 Australian states6
    • Wages & local procurement $730M (Excluding livestock purchases)6
    • Employs 8,500 people at the facilities6
      • Employs 12,000 people in Australia6
    • Total revenue of $6.5B6
  • JBS plants 2014_edited-1

    JBS processing plants in Australia

    Source JBS submission #50 Market Consolidation.

    • JBS estimates its current share of four eastern states beef kill – 20% (excludes service kill)6
      • JBS share of Australian beef production 16%6
      • Market share of national small (lamb, mutton & goat) 16%
    • JBS spent $2.4M on halal certification costs of approved religious certifiers in 20146

    2015

    • June. Cost of processing in Australia 1.5-3 times the cost of processing animals in another country6
    • cost of processing grain-fed cattle in Australia is twice of the USA6
      • lower levels of productivity in Australia in regards to kg per unit of labour6
      • 2 major differences between Australia and the USA6
        1. Government regulation
          • $10 a head more in Australia6
          • Dept. of Australian Agriculture fully recover costs of meat export inspection and certification6
            • Australia wide DAFF costs $80M6
            • JBS contribute $14.5M6
          • Export plants don’t use DAFF but use approved employees, which plants fully cover costs6
            • JBS estimate an additional $30M at Export level6
          • USA & Brazil governments provide services at no or minimal costs to processors6
        2. Energy Costs
          • $15 a head more in Australia6
      • Technical barriers to trade (TBT’s)- Total value in Australia estimated at $1.25B as identified costs6
        • 261 TBT’s in 40 key markets6
          • 136 have significant trade distortion impacts6
  • July. The following charts are from a submission by the Australian government Department of Agriculture to the Senate rural and regional affairs and transport references committee inquiry into Market consolidation and the red meat processing sector.

  • T2 Throughput state beef_edited-1

    Share of throughput by state for beef in 2014. Pg 16

    T4 processing companies market share_edited-1

    Major Processing companies by market share May 2015. Pg 16

    M4 direct cattle movements NLIS QLD_edited-1

    Cattle Movements to abattoirs. Pg 25

    F12 hourly labour costs food manufacturing_edited-1

    Hourly labour costs for food manufacturing industry Pg 30

  • December. ATO publishes tax data for agribusiness corporates.7
    • Data interpretation – Companies do not pay company tax on revenue (total income) they pay on profits after paying all expenses, including wages, capital replacement, supplier costs and other operating expenses.7
    • Income tax information is for 2013/14.7
    • JBS Holdco Australia Pty Ltd produced Total Income $4,040,948,610.7
      • Taxable Income $419,882,525.7
        • Tax Payable $44,809,334.7

Sources Bordertown – SA. JBS

  1. ‘Our plants – Bordertown’ http://www.jbsswift.com.au Accessed 13.11.2013
  2. ‘Second shift at JBS meatworks’ Stock Journal 03.10.2013
  3. ‘Robot Revolution’ Stock Journal 17.10.2013
  4. ‘Technologies take quantum leap’ The Land 24.07.2014
  5. ‘The next Swift Shift’ Weekly Times 30.07.2014
  6. sub50_JBS Inquiry into the effect of market consolidation on the red meat processing sector
  7. ‘ATO publishes tax data for agribusiness corporates’ Beef Central 18.12.2015
  8. AUS-MEAT Accreditation Listing 29.12.2015
  9. ‘Swift CCTV camera action’ Weekly Times 13.11.2013
  10. ‘JBS delivers lower third quarter beef sales, revenue’ Beef Central 14.11.2013
  11. ‘JBS takes stake in Andrews Meat’ www.farmonline.com.au 09.07.2014
  12. ‘What’s behind JBS taking a big stake in Andrews Meat Value adding Businnes? Beef Central 10.07.2014

Milestones in the Australian Meat Industry

Australian Abattoirs, Factors affecting Operations, Milestones 19/06/2013 Leave a comment

1860’s 

  • Outbreak of pleuropneumonia – decimated herds in NSW4

1861 

  • 1st Freezer works invented – Darling Harbour8

1870   

  • Tick introduced on imported stock from Dutch Bativia4

1896  

  • Tick Plague bought red water fever – killed many cattle, some pastoralists abandoned properties4

1910   

  • 3 Zebu bulls introduced to QLD4

1948   

  • 15 year contract with Australia – UK purchased all exportable beef surpluses8

1950’s   

  • Large numbers of imports of Zebu to QLD4
  • Refrigeration for long haul transports improved in efficiency and financially8
  • Sheep prices soared £1 head – during Korean war10

1954-60 

  • Britain won contracts in previous Australian export markets. USA developed ‘grinder beef’ allowed new markets for North Australia4
  • Global demand for beef, boom lead to record cattle numbers in Australia8

1959

  • USA Lean beef market development8

1960     

  • Australian Sheep herd 155M10
  • Petrodollars Money – Middle East had significant discoveries of oil and lifted living standards in those countries, created a building boom, workers mainly from 3rd world muslim countries10             pg 28
  • 1st shipment to Middle East. 2500 Australian sheep £6, 14 shillings and 4 pence a head including fodder for voyage10Pg 28

1967    

  • UK – had outbreak of FMD8

1970’s 

  • BTEC began – stopped 1989. Cost $800M
  • Large cattle numbers and slaughter rates in 1970’s prompted significant expansion in processing capacity in QLD, with an increase in capacity of 32% between 1975 – 1982 (Rolfe 1988). The plants then faced work practices characterised by single shifts and a tight tally’s system. Most of the expansion met through construction of new plant, which was also needed to meet export standards in many of the overseas markets3
  • Sheep live exports significant – Middle east, Cattle SE Asia8
  • Economic downturn in the 70’s led to drops in global beef demand8
  • 4 out of 5 meatworks in North Australia had their export licences withdrawn –
  • “inability to fullfill obligations under the meat board diversification scheme in Australia”8
  • Australian sheep herd 180M10Pg 37

1973 

  • Australian sheep herd 142.3M10Pg 37

1974     

  • Beef Crash – caused by major loss of markets USA & Japan, severe drought started. Cattle prices plunged to lowest level in 30 years.4
  • Herd shrank by more than 60%5
  • Oil prices crisis triggered global collapse4

1975     

  • LE to SE Asia re-emerge on a small scale after years of inactivity5
  • LE mainly to Malaysia, Philippines and then in early 90’s to Indonesia8
  • National Beef herd 32.8M10Pg 42
  • National Sheep herd 127.5M10 Pg 42

1978  

  • AMIEU – picket line 4 weeks, prevented sheep being loaded onto ship, Feedlot Adelaide Virginia 90,000hd sheep. Were losing sheep due to rain and cold weather, Waterside workers unions also striked in support.Unions lead by Bob Hawke. Public rally supported by Farmers 10,000 against the union 4th April 1978. Operation Sheeplift – loaded at Wallaroo.10Pg 43
  • Meat Processing in trouble – didn’t have enough outlets for all the meat it was processing, yet LE was thriving at significantly higher prices, LE was shipping aged merinos, not suitable to slaughter in Aust, AMIEU still picketed10Pg 49

 1980’s  

  • Cyclical downturn in slaughter numbers occurred in the early 1980’s, rationalisation was required. Industry commission inquiry in 1983 recommended market forces rather than government intervention be allowed to drive the changes.3
  • Plant closures of the late 1980’s was in response to rationalisation pressures. Most plants that were closed were the older, inefficient plants that reached the end of their operating life(Reynolds and Sangster 1998b).3

1984

  • Australian Meat Holdings (AMH) formed – was pivotal in rationalising the meat processing sector in QLD– consortium of 4 meat processing companies, Including Elders (who bought other partners out in 1988) who then sold to USA processor (ConAgra)1993-1996.

1984 – 1986 

  • AMH closed 5 plants of the initial 11 owned by the consortium – utilisation rates had fallen to 32%

1989   

  • BTEC finalised4.

1990’s 

  • By the 1990’s, plant closures tended to be forced by financial losses rather than operating inefficiencies3
  • USA market health regulations forced many abattoirs across Australia to shut down8

(Not sure when actually occurred – ????????)

1993   

  • Live cattle exports to Asia and Middle East 147,000hd1

1994  

  • Live cattle exports to Asia and Middle east 290,000hd1

1993 

  • Beginning of Enterprise Bargaining Agreements (EBA)

1994    

  • disputes and lock out at Rockhampton AMH abattoir

1996  

  • EBA’s introduced – Previously tally system has set rates of pay and also rate of productivity. Any new investment in efficiency meant workers just reached minimum tally in a shorter time. Tally system removed, increased production levels3.
  • EBA allowed multiple shifts,reduced penalties and shift loads, longer working days and increased pay rates. 30-40% increase in effective capacity. Lead to 40% reduction in unit costs3.
  • AMH if gained a 4% efficiency achieved a net gain of $62M over 10 years, industry wide net gain would yield $404 net gain3

2006

  • Innisfail Meatworks closed leaving Townsville as only Northern abattoir in QLD5.

2010 

“Last weeks QLD cattle kill of 43,700 hd was 40% below the same week last year, The extreme low rates of kill are also reflected in industry statistics showing that for the 3 months ended January 30, Australian beef exports to the US reached just 38,000t a far cry from the same period in 08/09 of 70,000t2

2011

  • Live Export ban to Indonesia.

2012  

  • Carbon tax introduction – $23/t for over 25,000t of greenhouse emissions.Europe payint $9.80/t6
  • Australian Export Meat Inspection System (AEMIS) introduced7
  • “AEMIS  utilises the presence of full-time government  veterinarian assessing the incoming stock and oversighting the production and inspection process, and a full time government food safety meat assessor inspecting”7
  • “The system is subject to external audits from senior Australian government veterinarians and by foreign officials representing many of our major trading partners”7
  • One processor says will add $100,000 in costs over next 12 months7
  • May. JBS arrived in Australia 2007, “despite $500m investment on improvements and upgrades, the cost of production of beef relative to major international competitors has actually worsened” JBS CEO Andre Nofueira12

2013  

  • February. QLD cattlemarket indicator (QCMI) 1985 $70.80 buy the same amount of goods in todays $ would cost $180.70 – prices are 30% lower in real terms than what they were in 859
  • March. Near record weekly kill tally – 81601, close to all time record July 200111
  • Young cattle indicator slipped 12c/kg, some grids back by 20c/kg
  •  

Sources

  1. ‘The past is before us’, The Australian Society for the Study of Labour History. Undated

www.historycooperative.org/proceedings/asslh/index.html

  1. ‘Abattoirs under stress’Beef Central 22.02.10
  2. Competition and Exit in Meat Processing:A QLD Case Study. Agribusiness review 1999

References with their articles (Rolfe 1988),(Reynolds and Sangster 1998b)

  1. ‘North’s Beef Powerhouse’ Nth QLD Register 22.11.12
  2. ‘100 years of Northern Beef Production’ Nth QLD Register 22.11.12
  3. ‘Processors beef with carbon tax’ Nth QLD Register 06.09.12
  4. ‘Exporters query E.coli blow-up’ QLD Country Life 31.05.12
  5. ‘Sailing ahead’ Annabelle Coppin 2009
  6. ‘Beef Prices at historic lows necessitates focus on cost of production’ Beef Central 18.02.13
  7. ‘The Australian Livestock Export trade’ Nigel Austin 2011
  8. ‘Record QLD kill reflects ‘avalanche’ or dry weather cattle’ Beef Central 19.03.13
  9. ‘JBS heads calls for industry-wide focus on competitiveness’ Beef Central 17.05.12