WAMMCO profit, rebates in pipeline

11 Aug, 2004 10:00 PM
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THE WAMMCO lamb cooperative expects to post a profit for the 2003-04 year and has finalised a payment policy for producer member rebates, which will be based on lamb supply in 2004-05.

WAMMCO general manager Des Griffiths said that with an improved financial situation the co-op wanted to give producers advance notice of the rebates.

³We expect to announce a credible result for 2003-04 and also expect this to continue and that¹s raised the need to formulate the rules on which rebates are possible,² he said.

³We are pretty confident we are on the right track and rebates may well be possible, so we need to announce how it will work.²

He said a difficult and time-consuming restructure from statutory marketing body to a lamb-focused cooperative had slowed down release of the rebate policy.

³We did not handle well the change from statutory body to a prime lamb operation in the first 12 months,² he said.

WAMMCO had to sell assets such as head office in Perth, the Linley Valley abattoir and the Spearwood boning room to cover foreign exchange losses before it was privatised.

To qualify for trading rebates, co-op members would have to hold participation units covering the lambs they supplied.

The foundation members have been allocated participation units based on one unit for every eight shares.

If a producer had 800 foundation shares they would have 100 participation units covering 100 lambs.

Members could increase their participation units by subscribing for additional shares, which would cost $1 for the first of eight shares with the remaining seven funded through future rebates.

But participation units will reduce if a member failed to deliver sufficient lambs in any year to generate the necessary rebate.

The rebates, which are worked out at the end of the financial year, are paid on over-the-hook trade lamb bought from members under WAMMCO's weekly price schedule.

Rebates are a traditional method co-ops use to distribute profits to members and can be in the form of cash shares or a combination of both.

WAMMCO was formerly the state's meat marketing corporation transferred into producers hands in August 1999.

Due to a glitch in the wording of the legislation and a long delay in gaining an amendment, the distribution of shares could not begin until June last year.

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