Tuesday, June 17, 2014

Meat processor joins $1bn lamb, beef deal to feed Inner Mongolia

V & V Walsh directors Peter and Greg Walsh plan to export boxed meat to Inner Mongolia where Grand Farm seeks to deliver up to 50 sea containers of lamb and beef a day.

“They will take whatever we can give them,” Peter Walsh said yesterday at the company’s headquarters in Bunbury, south of Perth.

The Walsh brothers took over the business from their father Vern, a butcher in the southwest town of Busselton. About 20 years ago, Peter Walsh visited China to sell sheepskins and realised it was the next important market for his family business.

Yesterday state Agriculture Minister Ken Baston said the three-way deal would significantly increase Western Australia’s meat and fodder exports to China and inject hundreds of millions of dollars into the local economy.

“With an estimated investment of $1bn over five years, the project will involve V & V Walsh, as well as China’s largest red meat importer from Australia and New Zealand, Grand Farm, and the Inner Mongolian government,” Mr Baston said.

“There will be investments in both jurisdictions — $200m of Chinese investment into WA to increase lamb and beef production; and $800m in Inner Mongolia, where there are plans to develop new processing facilities and an expansive network of feeding systems.”

Mr Baston believes there is strong potential for growth of beef and sheep meat into China because each person consumes an average 4.9kg of beef a year and 2.8kg of sheep meat. Australians consume an average 32.5kg of beef and 10kg of sheep meat.

“For every one kilogram of extra lamb meat consumed in China, an extra 65 million lambs will be required. And for every one kilogram of extra beef consumed in China, an extra 6.5 million cattle will be required. WA has the very significant opportunity to grow exports,” Mr Baston said.

V & V Walsh is in the final stages of gaining approval to export to China, and Chinese officials will soon tour the facilities to ensure they are satisfied.

Peter Walsh said the joint venture grew out of a 15-year friendship between his family and Grand Farm president and China’s Beef and Lamb Association chairman Chen Xibin.

Sheep meat exports from WA to China rose 77 per cent by weight from 2012 to 2013. Sheep meat exports last year to top trade partner China were $47m.

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