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Stewart Cruden - Northern Beef Processing Facility, AACo - PROJECT UPDATE: The outlook for the construction of the Livingston Beef Processing Facility
Stewart Cruden - Northern Beef Processing Facility, AACo - PROJECT UPDATE: The outlook for the construction of the Livingston Beef Processing Facility
Stewart Cruden - Northern Beef Processing Facility, AACo - PROJECT UPDATE: The outlook for the construction of the Livingston Beef Processing Facility
Stewart Cruden - Northern Beef Processing Facility, AACo - PROJECT UPDATE: The outlook for the construction of the Livingston Beef Processing Facility
Stewart Cruden - Northern Beef Processing Facility, AACo - PROJECT UPDATE: The outlook for the construction of the Livingston Beef Processing Facility
Stewart Cruden - Northern Beef Processing Facility, AACo - PROJECT UPDATE: The outlook for the construction of the Livingston Beef Processing Facility
Stewart Cruden - Northern Beef Processing Facility, AACo - PROJECT UPDATE: The outlook for the construction of the Livingston Beef Processing Facility
Stewart Cruden - Northern Beef Processing Facility, AACo - PROJECT UPDATE: The outlook for the construction of the Livingston Beef Processing Facility
Stewart Cruden - Northern Beef Processing Facility, AACo - PROJECT UPDATE: The outlook for the construction of the Livingston Beef Processing Facility
Stewart Cruden - Northern Beef Processing Facility, AACo - PROJECT UPDATE: The outlook for the construction of the Livingston Beef Processing Facility
Stewart Cruden - Northern Beef Processing Facility, AACo - PROJECT UPDATE: The outlook for the construction of the Livingston Beef Processing Facility
Stewart Cruden - Northern Beef Processing Facility, AACo - PROJECT UPDATE: The outlook for the construction of the Livingston Beef Processing Facility
Stewart Cruden - Northern Beef Processing Facility, AACo - PROJECT UPDATE: The outlook for the construction of the Livingston Beef Processing Facility
Stewart Cruden - Northern Beef Processing Facility, AACo - PROJECT UPDATE: The outlook for the construction of the Livingston Beef Processing Facility
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Stewart Cruden - Northern Beef Processing Facility, AACo - PROJECT UPDATE: The outlook for the construction of the Livingston Beef Processing Facility

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Stewart Cruden delivered the presentation at the 2014 Building the Territory Conference. …

Stewart Cruden delivered the presentation at the 2014 Building the Territory Conference.

The inaugural Building the Territory Conference 2014 is an opportunity to meet with the project owners and leaders, to hear about the new opportunities and developments for the built environment in the Territory.

For more information about the event, please visit: http://bit.ly/BuildingtheNT2014

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  • 1. Building the Territory AACo’s - Northern Beef Processing Facility Stu Cruden, General Manager 21 August 2014
  • 2. The Northern Beef Processing Facility • Located at Livingstone, 50km south of Darwin on the Stuart Highway • Process capacity of about 200,000 head p.a. • Predominantly manufactured beef – hamburgers and mince • From Darwin port via Singapore to export markets in the US and Asia, including Indonesia, China and the Philippines. Australia’s largest beef producer is developing a strategic beef processing facility selling directly into beef export markets 35 largest existing beef processing facilities Legend NABL (50km south of Darwin) NABL
  • 3. A flexible and low-cost facility • “Hot-boning” production model – low cost and high productivity • Stage Two will convert the facility from a manufacturing plant to a prime plant • Includes cull cows and bulls and heavy steers in the NT and north Western Australia • AACo has the capacity to supply 35-40% of cattle to the facility • Ability to process 12 months of the year.
  • 4. Key demand drivers for beef • The Northern Beef Processing Facility will export beef to the US and fast-growing Asian markets World agrifood demand, population and income (2050) 50 100 150 200 250 300 2007 2014 2021 2028 2035 2042 2049 World income World agrifood demand World population Index (2007 = 100) Source: ABARES model output (2007 US dollars) 211% 77% 40%
  • 5. Key demand drivers for beef World agriculture imports in Asia (US$ billion)Beef import demand (US$ billion) 79 5 39 123 123 108 360 591 0 200 400 600 800 Rest of Asia India China Asia 2050 0 1 5 2 1 5 5 10 18 39 0 10 20 30 40 50 India ASEAN Rest of Asia Africa China 2050 World demand for beef is expected to grow from US$7 billion to $60 billion by 2050.
  • 6. Impact on the northern cattle industry • Current economics of slaughter leads northern producers to retain cows despite likelihood of death/lack of productivity • Livingstone facility will provide an attractive market option for these cull cows and bulls • Improves the productivity and profitability of the industry Cow selling decision tree (ACIL Tasman analysis) Cull cows (< x years old) Retain (status quo) Send to slaughte r Replace with heifer / steer Rears a calf (~24%) Does not rears a calf (~56%) Dies (~20%)  Creates a viable marketing option for cull cows by eliminating transport / shrinkage costs  Immediately increases sales value and turnover Benefits Profitability  Improves average herd profile over time leading to increased fertility and lower mortalities Productivity Superior financial outcome
  • 7. Key regions of supply • Only material processing facility in northern Australia • Producers in NABL’s target regions will incur lower transport costs and shrinkage rates to Darwin than East Coast facilities Pilbara–Gascoyne Kimberley Top End–Roper–Gulf Barkly–Tennant Creek Victoria River District–Katherine Cape York and Gulf of Carpentaria Major road transport route Arc Distance (km) * Rate/km** 201-400 $ 1.76 2 401-800 $ 1.67 3 801-1000 $ 1.54 4 1001-1200 $ 1.51 1200 + $ 1.47
  • 8. Key regions of supply Region has a total herd of more than two million head. Northern regions 2006-7 2007-8 2008-9 2009-10 2010-11 Avg. 5 year Alice Springs 268 345 182 245 230 254 Barkly Tableland 564 537 566 445 702 563 Katherine 676 800 843 843 907 814 Top End 176 294 42 56 55 125 Total NT 1,684 1,976 1,633 1,589 1,894 1,755 Kimberley 635 472 458 646 570 556 Total 2,319 2,448 2,091 2,234 2,464 2,311 Summary of Northern cattle regions (‘000) Northern regions 2006-7 2007-8 2008-9 2009-10 2010-11 Avg. 5 year Alice Springs 65 126 57 55 48 70 Barkly Tableland 135 499 292 171 341 288 Katherine 136 247 243 188 217 206 Top End 31 117 7 14 13 37 Total NT 368 989 600 427 620 601 Kimberley 153 145 160 198 162 164 Total 521 1,134 760 626 782 765 Total cattle turnoff per annum (‘000)
  • 9. Reduced transport costs $- $50 $100 $150 $200 $250 $300 Katherine Tennant Creek Alice Springs Mt Isa Halls Creek Broome Barkly Dinmore Rockampton Townsville Darwin Transport Cost Comparison ($/head) to processing facilities
  • 10. Benefits for all, not just beef • $ millions a year boost to the economy • Creates 300 new / Permanent jobs and 500 indirect jobs • 30 per cent increase in container traffic at Port of Darwin • Better cold-chain logistics for horticulture and aquaculture

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