Processor confirms HGP-free premium

27 Feb, 2011 04:00 AM
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WESTERN Meat Packers (WMP) has confirmed it is paying a premium to cattle producers supplying cattle produced without the use of hormone growth promotants (HGP).

WMP, which has an abattoir in Cowaramup and a processing plant in Osborne Park, is one of two WA processors supplying HGP-free beef to Coles and is currently processing 1600 cattle a week.

Last week, WMP owner and general manager Rod Russell told Farm Weekly that the producers under contract to supply them with HGP-free beef were being paid a premium price which had been agreed to by both parties involved.

Mr Russell said Coles did not dictate prices and it was strictly between the processor and the producer.

He confirmed that they were paying their producers a premium to supply them with HGP-free beef, at a price that had been calculated by the producers based on the extra costs involved in production.

"Growers are flexible and they've done the sums to see if it's viable for them to produce hormone-free cattle and if it's worth their while then they've embraced it," Mr Russell said.

"We tell growers our specifications and they tell us the costs involved and put their price out.

"I can tell you that all grower contracts, which are done three months in advance, have been accepted so all our growers are moving forward.

"I'm told we're a fair way in front of the market in that regard."

Mr Russell said based on early figures, the difference was around 10c/kg to produce HGP-free beef within the specified 210-270kg range, compared to using HGPs.

He said that figure was lower in the Eastern States but he expected it to reduce in WA as growers became accustomed to the practice.

At the moment, most of the HGP-free cattle coming through were fed for 70-80 days on grain and so far, Mr Russell said he was happy with both the quality and the weights of the beef they had processed.

"On one day last week we killed 326 head (HGP-free) and of those, 320 made MSA grade, one was a non-grade and five were too heavy," he said.

"I am very happy with statistics like that."

Mr Russell said they realised weight gains were not the same without the use of HGPs, but they had already noticed the meat was softer and not as coarse as HGP-beef.

He said it also achieved a better MSA ranking, generally between 1-4 compared to 1-6 with the use of HGPs.

The majority of cattle being processed by WMP at the moment is HGP-free and Mr Russell said any HGP animal that came through was processed at the end of the day to avoid any contamination.

He said there was segregation throughout the line, which was a process they were already used to doing for organically produced meat, being a certified and accredited organic processor.

Come spring, Mr Russell said all the grassfed beef would be HGP-free anyway so it was really only with grain-assisted cattle that HGPs became an issue.

Mr Russell said supply was a concern, but they had 6000 cattle on feed directly as well as another 5000-6000 on feed with other alliances.

"Supply will be tough but my biggest concern is the number of breeding cattle and sheep that we're losing," he said.

"Similar to the fishing industry where they hold off to let breeding numbers of certain species increase, we need to have two years in WA where we keep breeding stock here, for the long-term future of the industry."

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