Beef industry sustainability: Keep customer in loop to reap the benefits

JAMIE-LEE OLDFIELD, The Weekly Times January 16, 2017
INTEGRATING  the supply chain, and keeping the customer in mind, will go a long way to creating a sustainable beef industry, according to Frank Carbone of AgriFoods Global, previously McDonald’s Asia Pacific Consortium.

The company operates 19 grinding operations worldwide, sending Australian and New Zealand beef to make McDonald’s patties in countries including US, Japan, ­Malaysia, Ukraine and Russia.

Mr Carbone, who spoke at the Meat and Livestock AGM last year, said what surprised him when he entered the beef ­industry was the number of disconnects happening from producer to consumer.

“I think to be able to create predictability and have some visibility of outcomes, some level of integration across the supply chain is important, and from our perspective we are hoping to bring volume to the table to try make that happen,” he said.

“So producers and processors can align to create some visible outcomes, that is something we want to be party to.

“When you see the kinds of volatility that occur, whether it is currency, whether it is price, whether it is seasonal — some certainty in outcomes is really a huge value add.”

Integrating more closely would not only make for a more sustainable and transparent supply chain, but also give all parts more opportunity to make a predictable profit.

Hearing what the customer wanted and being able to ­deliver on that was also crucial, Mr Carbone said.

“Increasingly, the customer wants to understand more about what they are putting in their mouth,” he said.

“So when it comes to things like beef, and all the information that goes around the fact you are raising an animal to kill it for food, I think for the most part people understand that is a necessary process.

“But they want to understand that animal had a good life, was treated well, was fed well and produced a good quality product — that story is what brings them comfort.”

Australia was on the right path to sustainability with the Red Meat Advisory Council’s framework, Mr Carbone said.

“Some of the experiences our network has had through the Canadian approach have highlighted you can pretty flexibly come at this and as long as you are focused on outcomes you can drive the right message and right result, and make a fairly achievable and practical outcome,” he said.

Agrifoods Global is owned by five North American McDonald’s beef patty manufacturers, and Mr Carbone described the current US market as “bearish”.

“Right now (it is) not very competitive in the US for us , it doesn’t mean we abandon the US we will still push product in, but it is certainly bearish,” he said. “Decisions they (the US) take about their industry might create other opportunities, but they have plenty of supply while we are running tight.”