Red meat processor costs to operate under the microscope
Australian red meat processing costs continue to rise and remain higher than key international competitors in New Zealand, the United States and Brazil, new research from the Australian Meat Processor Corporation shows.
The analysis found Australian processing businesses were seeking to offset rising operating costs and higher levels of regulation through innovation and productivity improvements as they work hard to remain competitive on the global playing field.
Average beef processing costs in Australia reached A$531 per head in 2024/25 (excluding livestock supply), a rise of 47 per cent in the past nine years, well above the 29.5pc rate of CPI inflation over this period.
When compared in Australian dollar terms, processing costs in the US and New Zealand are estimated at A$527 and A$519 respectively, while Brazilian beef processors continue to enjoy significantly lower costs of A$290 per head.
Sheepmeat processing costs have risen even further, reaching A$64.31 in 2024/25, up 58pc in nine years and slightly above New Zealand sheepmeat processing costs of A$63.69 per head.
Further, Australian red meat processors are subject to higher regulatory costs overall, with around half of their costs subject to regulation, compared to around 40pc in New Zealand and around 30pc in the USA and Brazil.
The largest increase in costs for processors occurred in transport, repairs and maintenance as well as registration and certification costs.
The research, conducted by SG Heilbron Economic & Policy Consulting, investigated red meat processor costs to operate during the 2024/25 financial year, with comparison to previous analysis in 2015/16. A report on the findings has now been published, called Analysis of Operating Costs for Australian Red Meat Processors and International Competitors.
AMPC chief executive officer Edwina Toohey said this research provided valuable benchmarking data for the industry.
“It is critically important for our industry to understanding of our competitive position on the global stage, particularly given the current uncertainty in market access and supply chains,” she said.
“While Australian red meat processors continue to operate in a high-cost environment, we continue to set the standard in meat quality, food safety and innovation.
“Our industry plays a crucial role in the agri-food supply chain, supporting high value Australian exports and delivering local and regional jobs.”
AMPC thanked all processors who contributed data to the project and acknowledged Dr Selwyn Heilbron for undertaking the analysis.
See the full report here.
For more information
Contact AMPC Communications Specialist Shan Goodwin on 0419 547 760 or email s.goodwin@ampc.com.au
