The Australian Agricultural Company’s (AACo) herd has grown by 13%, bringing the herd total to almost 433,000 animals.
This news comes ahead of the implementation of the UK-Australia Free Trade Agreement, which will see the removal of most tariffs on trade between the UK and Australia.
The agreement is due to come into effect at midnight on Wednesday (May 31).
The trade agreement will allow for more Australian beef to come into the UK market tariff-free, with a tariff rate quota (TRQ) of 35,000t, rising in installments to 110,000t within 10 years of the agreement.
This is substantially more than the current levels of Australian beef imports, which are around 2,500-3,00t/year according to the UK government said.
As well as an increase in its herd numbers, AACo’s operating cashflow was also a positive for the 2023 financial year, the company said, sitting at $16 million.
Managing director and chief executive of AACo, David Harris, said the company has also commenced a “major increase in our production capacity” with the expansion of one of its properties.
“Once operational, we will be able to further improve our value chain and boost our global supply.”
“Not withstanding our herd growing by 13% and producing 19% more live weight kilogrammes, whilst being operating in a high cost environment, we were able to hold our cost of production stable with a 2% reduction/kg.
“I think it’s a great demonstration of how we are creating a simpler and more efficient AACo as we continue making operational efficiencies throughout the supply chain.”
A number of UK farming organisations have raised concerns related to the trade deal, with some saying that UK farmers will suffer as more Australian produce becomes available in the country.
The Government’s Impact Assessment (IA) shows a negative effect on the UK agriculture, forestry and fishing; and the semi-processed food sector as a result of the deal.
The National Farmers’ Union (NFU) previously stated that there is little in the trade deal to “benefit British farmers”.
Speaking on the UK’s trade deals with Australia and New Zealand, NFU president Minette Batters said:
“It’s clear that UK farmers have very little to gain from these two deals; instead, we are pushing the government to focus its trade efforts on opening up markets where there’s a genuine opportunity for UK agriculture to grow our sales of fantastic products overseas.
“Confirmation that the UK’s new trade deals with Australia and New Zealand FTAs will come into force at the end of May brings into sharp focus the need for our government to monitor the ongoing and cumulative impacts for our farmers and growers of the inevitable tougher trading environment they will face.”
The government has said that the concerns of farmers and farming organisations are “misplaced for several reasons”.
Market access for Australian producers, it said, will be phased in gradually for “sensitive products” like beef and sheep meat.
The quota system which limits the volume of tariff-free imports of certain products from Australia for up to 10 years also aims to offset negative impacts on UK farmers.