Head Shepherd
Mark Ferguson from neXtgen Agri brings you the latest in livestock, genetics, innovation and technology. We focus on sheep and beef farming in Australia and New Zealand, and the people doing great things in those industries. To learn more about neXtgen Agri, visit www.nextgenagri.com.
Head Shepherd
Sheep Producers Australia: Insights from CEO Bonnie Skinner
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Our guest on the podcast this week is Bonnie Skinner.
Bonnie is the CEO of Sheep Producers Australia (SPA), a levy board that advocates for a better future for Australia’s sheep industry. They do this in a multitude of ways: connecting farmers, consumers and government bodies. They advocate for better outcomes for farmers and direct levy investments towards research, development and industry services.
In this episode, Bonnie and Mark discuss the current challenges faced by the industry - be it artificial proteins, climate change or getting new entrants into the industry - and also what the future holds for lamb and wool producers.
It’s not all doom and gloom, explains Bonnie: “In terms of providing that light on the hill, there is an immense opportunity for lamb as a protein, if we can continue to meet the needs of our consumers.”
“Of course, we are already world-renowned for a high-quality, very consistent product in the industry. We know we can continue to improve on that. But what is the customer willing to pay for? How much room is there to really drive that price up, particularly at a retail level?” These are the questions that SPA are asking, and working towards answering, with industry support.
Another issue faced by the industry is the uptake of new technologies and practices. One example being scanning for multiples. Despite the evidence that it will improve profitability and production on-farm, only 42% of Australian producers scan their ewes and, of these, 69% scan for dry, single and multiple foetuses.
“We've got 10-15% of producers at the top, the early adopters. They are taking up all of these opportunities,” explains Bonnie. “Then we have a good subset of producers underneath that, who are interested [but are not taking the next steps towards adoption]. How do we encourage producers to take up these practices?”
In this podcast, Bonnie explains the scope of SPA’s work for the industry: from identifying required research, right through to farmer implementation, and everything in between.
Head Shepherd is brought to you by neXtgen Agri International Limited.
We help livestock farmers get the most out of the genetics they farm with. Get in touch with us if you would like to hear more about how we can help you do what you do best: info@nextgenagri.com.
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Welcome to the Head Shepherd Podcast. I'm your host, mark Ferguson, ceo at NextGen Agri International, where we help livestock managers to get the best out of their stock. I want to take this opportunity to thank our friends at MSD Animal Health and Allflex for sponsoring Head Shepherd again this season, and I'm also excited to introduce our mates at Heinegger as brand new sponsors of the show. Msd Norflex, or perhaps better known as Cooper's Animal Health in Australia, offer one of New Zealand and Australia's largest livestock product portfolios, with a comprehensive suite of animal health and management products connected through identification, traceability and monitoring solutions. Like us, they see how the wealth and breadth of information borne out of this podcast can help them and their farming clients achieve their mission of the science of healthier animals.
Speaker 1Heineken will need a little introduction to our audience. A market leader and one-stop shop for wool harvesting and animal fibre removal, together with an expanding range of agricultural products and inputs, the Heineken name is synonymous with quality, reliability and precision. The Heineken team have a deep understanding of livestock agriculture, backed by Swiss engineering and a family business dedicated to manufacturing the best. It's fantastic to have both of these sponsors supporting us and bringing Head Shepherd to you each week, and now it's time to get on with this week's episode. Welcome back to Head Shepherd. This week, sophie, you've been expanding your wings in terms of editing podcasts.
Speaker 2Yeah, so it's no longer just sheep and cattle, we're looking at goats. So I've been editing podcasts for the Fibre Frontier, which is a podcast we're running for AgriFutures.
Speaker 1Yeah, so it's part of a project we're running for AgriFutures in conjunction with the Moher and Kashmir Industries of Australia Exciting project kicking off to help that industry coordinate its effort and, I guess, promote, promote the opportunities in mohair and cashmere production, particularly in the sort of north of the divide in Australia. There's a lot of opportunity there and other parts as well. And so, yeah, it's a project we sort of started end of last year. But the Fibre Frontier is our podcast we're running as part of that so we'll be covering the whole industry from sort of buyers and brokers and producers and processors. So anyone who's interested in fibre, go to the Kashmir and Mohair, jump on over to the Fibre Frontier. Also we've got the Goat Fibre Gateway, which is a place where we're putting all of the resources that we're pulling together as part of that project. Opportunity there to interact with other breeders and learn more about mohair and cashmere production. Mohair is sort of sitting at a pretty high level historically at the moment sort of $60, $70 a kilo for the top stuff, and cashmere is sitting at sort of $150 a kilo for top stuff. So a little bit different to some of our other fibres at the moment and obviously different yields and different production systems. But yeah, we're working on there.
Speaker 1So jump on over to Fibre Frontier, but we better get on with today's show, which was a great chat with Bonnie Skinner. Bonnie's the CEO at Sheep Producers Australia, a group that work on behalf of the sheep industry to make sure the big issues are covered and work with government and with industry to try and get good outcomes for sheep producers in Australia. A really interesting chat with Bonnie. Obviously some big issues at the moment in Australia with live export EID coming across all states now as being mandatory, as well as just the general pressure on the industry as well. So, yeah, I'm sure you'll enjoy this chat with Bonnie Skinner.
Speaker 2Thank you so much for having me.
Speaker 1Awesome to have you on and obviously we're going to be talking about all things sheep industry in Australia, but we'll start with more about you. I've done a quick bit of reading and it looks like sheep weren't always your first love. It looks like horses were a bit higher on the agenda back in the day.
Speaker 2Yeah, I tend to tell people that horses were a little bit of my gateway drug into agriculture, to be honest. And yeah, originally a city girl with parents very much working in sort of the television, film and music industries, so not off a farm, but growing up we had very good family friends who had a sheep property down in the Snowy Mountains in the Monaro region of New South Wales and they also had horses and we used to go down there for holidays, basically every school holidays. I was down there from about the age of five or six and throughout that, you know, really fostered a deep love and appreciation for the land and for rural life and also for the sheep industry as well. And I ended up actually doing my gap year there before I went off to uni and I did study equine science. But I certainly got put through the wringer down on that property. I can tell you I've done all the dodgy sheep jobs that they're, you know, the initiation jobs. I'm sure you know what I'm talking about.
Speaker 2And yeah, I went to uni and did equine science and went on to do honours there and nearly went down the PhD route but decided I sort of needed to get a job in the real world and had a mix of jobs around research and being a research assistant, but also working in the animal pharmaceutical industry, before sort of finding my way into the animal health space on the non-for-profit side and working with Animal Health Australia and certainly got an introduction to a lot of the policy aspects, given that was based out of Canberra that role, and you know it's where a lot of the peak industry bodies come together to talk about policy issues, industry issues and obviously close proximity to the Australian government.
Speaker 2So, yeah, took on a variety of roles, working in extension for biosecurity practices on farm, predominantly with the cattle industry, and then found my way into the policy role at SPA and yeah, it'll be six years nearly with the organisation in July and in that time worked from my way up from policy manager to deputy CEO to CEO.
Speaker 2So it has been probably a non-traditional pathway to get to this place and it's taken me a long time to be confident about saying that I'm from the city. People tend to write you off pretty quickly in agriculture. They certainly used to when I used to say that and you know being younger as well. People question you know why you take an interest and how authentic you are and what you know, but hopefully I think I demonstrate that very much to the industry and my job is really to, you know, facilitate and bring together really, really incredible people from across the industry who are passionate about finding a really good future for the industry. And it's a fantastic job to have and makes me excited every day to work in the sheep industry, even though we've had quite a tumultuous little period of time recently here in Australia. So that's a little bit about me.
Speaker 1Excellent and, yeah, everyone we capture from the city we're happy with in Australia. So that's a little bit about me. Excellent and, yeah, everyone we capture from the city we're happy with. So more than Mary. We actually just off a couple of days at the Zanna McDonald Summit and one of the big topics was all about how we get more people from the city into ag rather than the opposite, obviously.
Speaker 2Yeah, well, you know that is exactly right. I mean, I think I was so fortunate and have probably underestimated, you know, as I said, horses being my my gateway drug, I mean it. You know that that was what wanted to, that was what fueled me to get out on farm, but, um, I was so fortunate to have spent so much time and, and particularly seeing all aspects, uh, down there. You know, I spent a lot of time down there when we had our big millennial drought as well in Australia, so seeing you know how tough it was, but also, just, you know, the people that make up the industry were totally inspiring. And so, yeah, I think you know we talk a lot in Australia about trying to get people out on farms, kids out on farms, to give them that experience. And I think you know, situations like mine were probably more common when families had cousins and different relatives out in the country and they would go and visit them.
Speaker 2It seems to be less and less these days, for whatever reason, obviously more of a migration towards the cities. So, yeah, we need to be encouraging the next generation. It's not city people don't. It's not that they deliberately don't want to take an interest, it's just a whole world they don't know, and when you introduce people to it, they very quickly fall in love with it or gain an appreciation for it. So don't worry, I still have a lot of friends that are vegetarians and vegans, and we have very good discussions about how the industry does and doesn't work. So, yeah, yeah, excellent.
Speaker 1So yeah, you took over the helmet. Was that middle of?
Speaker 222 and then yeah, yeah, yes, I was acting for uh, acting in the role for probably four or five months, I think, um, and went through the selection process and and was successful. So yeah, it's been. It's been about that long. It seems like it's gone very quickly and I guess, being in the organization already it was um. There was not a lot of time taken up by me trying to get across the issues, but it's certainly been a tumultuous time since then and certainly coming out of covid as well has been interesting yeah, I mean back 22.
Speaker 1things were pretty shiny in in the chief industry and and, uh, yeah, obviously last year was one of the toughest ones, particularly the back up of last year. It was probably the toughest, definitely the toughest period I've seen since the late 80s I suppose, when the wool boom crash, boom, crash, crash, boom either way, the wool price, the rural reserves game disappeared and the impacts of that. But yeah, certainly it was pretty unsettling for lots of people and I guess lots of other changes going on that you're sort of helping people navigate.
Sheep Industry Economic Challenges and Solutions
Speaker 2Yeah, I think if you lay the context as well around, you know the challenges we had during COVID tightening labour supply, rising input costs, inflation. You know all of those things that people have to grapple with as it is. And I think you know high prices give people the confidence to reinvest back into the business, so retaining a lot of use. You know that confidence to breed up numbers and the rebuilding of the flock. That happened in earnest. You know we always knew we were going to come back into a dry period and with numbers rebuilding. I suppose we're very familiar that the sheep industry in particular has that boom bust cycle and that's something as an industry that we are looking to see how we can address that. But yeah, certainly coming into that period, there are a few people who were starting to talk about what we might be seeing in terms of prices coming down.
Speaker 2I don't think anyone really expected quite the crash.
Speaker 2That did happen in the time that it happened and what came with it was just that colossal drop in confidence, which is completely understandable.
Speaker 2But I mean, you know there's obviously been a lot of discussion around the bomb and you know the announcement of dry times and it was um concerning and interesting to watch it unfold, in the sense that, you know, we we had some very concerned producers reaching out to us that I spoke to, that had a lot of feed, um, but totally, totally, just, you know, dropped the bundle and and wanted to protect everything that they, you know, that they'd been working so hard for understandably, and, yeah, that drop in confidence is very hard to explain, I don't know. In some ways, I mean, I I kind of, you know, talked about this with a few people and was it a consequence of you know, the really terrific, horrific, sorry, drought being up not that far long gone? Yeah, you know, did that really horrific drought being not that far long gone? You know, did that trigger people who had taken a lot of debt, a lot of risk? You know, people were doing exactly what we tell them to do when dry times are announced right.
Speaker 2So yeah, it was an interesting period in time and certainly we deal with producers from all across Australia and some take very pragmatic views. Some were not mentally in that situation and it's hard for us to navigate and to reassure people to sort of say, you know, look, we're going to get through this everyone Easy enough for us to say, certainly being in Canberra or those that are sitting on our National Policy Council, but yeah, people out there dealing with really hard situations. So very interesting period in time. I think we're fortunate that we saw, you know, certainly December, january, things start to pick up again in terms of prices and lamb certainly made a very strong recovery.
Speaker 2You know, mutton dropping 70% it was unbelievable and has been slower to recover. But yeah, there's a few things going on as well that make us question what is the new normal in terms of cost of production for the industry and how much of people's input costs have gone up? And so where do prices realistically need to sit for people to be profitable in the industry? And that is a very you know, get a very diverse lot of answers to that question depending on where you are.
Speaker 1Yeah, exactly, and I guess maybe the yeah, I guess the surprising thing for me, or maybe it's yeah, there's definite lag between prices coming up and confidence being regained. People are still very, very jumpy about the sheep industry and wondering, yeah, should this be? I guess we all go through that sort of trauma. You don't want to bounce yourself back into it and face that again next year or the year after. So people are rightly concerned, I suppose, and that's knocking their confidence.
Speaker 2Oh, absolutely, and I think we have seen a lift in confidence in some areas and you can see that reflected in the market. But for producers themselves and you know every region and every area is different. You know Western Australia in particular. We're facing the. You know the potential threat of the phase out of the live export industry and I know that's having a. You know what we are trying to communicate to government now is to say that this is already having an impact on people's decision-making, and this is before you've announced any details more than you have.
Speaker 2You know we've been going through this consultation process and trying to get clarity around that People are making decisions now, you know, and that is fair enough, but that's very scary for our industry. And obviously you know our organization is focused entirely on a sustainable and profitable industry. So you know we're having discussions internally about. You know strategically what is needed to drive the industry forward, to give them the confidence to invest, keep investing, and you know what can be done to help address the market volatility that we see in the sheep industry and to sort of smooth out these peaks and troughs that we see in supply. It's you know, it's a regularly repeated pattern when we look back over the history of the industry, um, so surely maybe, or what can we do something um to to address that? So, um, yeah, I, it's a tough time.
Speaker 1It certainly is for a lot of people yeah, no doubt I'm sitting in new zealand where about 15 20 percent of our listeners are and, yeah, same thing here. Basically, a few different factors, a bit more government regulation here and a few other things that are not confidence and not necessarily. Well, there was the same threat of Aldina that looks like it is actually playing out, although I'm watching it rain outside at the moment, yeah, but it certainly is drier than average and prices are way back and I'm selling down to two bucks live weight this week and stuff, so it's getting pretty pretty sticky. So, yeah, lots of lots of people facing challenges. The um. Before we go any further, be good to just, I guess, talk about the scope of sheep producers australia and sort of where. Yeah, your roles and I guess, the Not necessarily the current focus, but I mean you can't be all things to all people. So what's the key job that Sheep Producers Australia do for all sheep producers of Australia?
Speaker 2Some people would expect that we are.
Speaker 1We are and we should be all things to all people which can make my job a little challenging, I can assure you. That's why I thought I'd give you this little free hit.
Speaker 2No, so we are the peak industry body for the sheep meat industry in australia and that is actually a role that we have under legislation, um, uh, and it's a role we take very seriously. Um, there is another body that is largely responsible for the wool industry, where we certainly um collaborate with them, um, on a lot of issues to do with the animal, the sheep, so just to give people that confidence. So we have a very particular role that's laid out and Australia is fortunate, I think, and was probably quite progressive at the time in the 90s, in terms of setting up a lot of roles and responsibilities for peak industry bodies, in terms of setting up a lot of roles and responsibilities for peak industry bodies for research and development corporations, rdcs, and how everyone needed to play together in the sandpit to ensure that we would have a successful industry. And this was all at the time, obviously, that the export industries, particularly for lamb, were being developed and cultivated, and we're very fortunate in that regard. And so our job is to work with other peak bodies in the red meat industry, but also with our key service provider in rdc meat livestock australia, and we work with them about the strategic future of the industry. So we all come together and we and I'm explaining this because this is a particular role that we we have um, we have a strategic plan for the red meat industry, which we now have a 10-year one called Red Meat 2030. And we all agree collectively on what those strategic objectives are and we work with the RDCs to implement them, basically with a view to achieving them, of course. So that's a key role that we play.
Speaker 2To bring it down another level, on the sheep industry yeah, our job is to ensure that, you know, producers have a sustainable and a profitable future and for us, you know, primarily that's in the policy space that we're looking for, and I would say that we are a very future-focused organisation in terms of the way that we develop policy. And that can be challenging in situations like these, where we're dealing with short we'll call them short-term pain points that have potentially a big impact on what could happen down in the future. But how do we put things and measures in place and policies in place that shore up the long-term viability of the sector and that can sometimes, I would say the perception of those decisions can be at the consequence of what's happening in the short term? Some people would view, I suppose, the implementation of EID and national traceability reform as an example of that. So, yeah, so we focus on a lot of different areas, all things to do with sheep production, probably our key areas that we work across, everything to do with animal health and biosecurity, market access and trade, product integrity and productivity type issues as well. We're dealing with our traceability systems, our quality assurance systems.
Speaker 2Carbon climate policy is a major focus of the organisation this year, and there's a lot of lessons we're learning off New Zealand in that space as well, and, luckily, a lot of collaboration that're learning off New Zealand in that space as well, and, luckily, a lot of collaboration that happens between ourselves and people in New Zealand on some of those things. So, yeah, we're sort of covering all gamuts of the whole space that we play in, and, yeah, there's a few other roles that we play as well. We again try to be all things to all people.
Speaker 2Trying to keep a focused agenda is really difficult and, like I said, our policy really, though, is around national issues or issues of national importance, so our members are the state farming organisations and, ultimately, yeah, the job for our National Policy Council and our board is to agree on things that are in the best interest for everyone, which, as you can probably appreciate, it's pretty difficult sometimes to agree on a consensus position. So yeah, so that's a little bit about what we do, and I guess the nutshell version is that we look to maximise opportunities for industry and minimise risks. That's probably how I would characterise it.
Speaker 1And that's achieved through, obviously controlling that research agenda, but also through direct lobbying to order discussions with government, whether it's called lobbying or how you're.
Speaker 2Yeah, we're, under our constitution, not allowed to lobby but we do advocate for industry and so, yeah, part of our role with government is really to foster that deeper understanding of the sheep meat industry and we really position ourselves to be a trusted advisor to government on sheep industry issues. And you know, obviously we've had a new Labor government come in and navigating those relationships has been interesting and I suppose, as a government that doesn't have the deep roots to agriculture on the surface level as the previous government did, who was also in government for a really long time. So you know, we are in regular contact with everyone on the political side of things, but also our federal government Department of Agriculture as well, and working with them on a lot of key things. So, yeah, we've probably been more active on the policy, the political side, in the last probably two years than we have been in other points in time, largely because of some of the major announcements by this government around phase out of live sheep exports, introduction of a biosecurity protection levy.
Speaker 2We've got the Ag and Land Sectoral Plan announcement. There's a lot of initiatives this government is pursuing. That has probably really ramped up our political engagement, more so than in other previous years. So, yeah, a lot of work with those guys. I wouldn't say we control the research agenda. Certainly our producers would like us to have that job.
Speaker 1Sorry, influence would be a better word.
Speaker 2Yeah, we're supposed to work with MLA on delivering those outcomes, and that has been a tricky relationship to navigate at times and certainly everyone brings very different opinions, brings different opinions about where the research agenda should be going.
Speaker 2But again, we sort of all work under that broader strategy of Red Meat 2030. We're talking about developing, as I said, a strategy for industry that more so addresses some of these other issues that we know we have to deal with around. You know, supply and demand, smoothing out those peaks and troughs in supply, what do we need to do to have a sector in which people want to be a part of, and what needs to happen at the flock level for those changes to occur. So that's something we're focused on as well. In the short term, we also importantly, I should say, one of our other key roles is we are the ones that are responsible for oversight of the levy the sheep transaction levy and making sure that that is meeting the needs of industry and we're the only ones that can implement changes to that, and that's a role that's taken seriously, although the sheep meat levy has never changed since the time it's been introduced. So that's also been an interesting point of discussion in the context of inflation and other things that are going on at the moment.
Speaker 1Yeah, for sure. So if we do, you remember sort of touched on a few of the. I don't know if I want to go into all the issues, because it can get a bit. It can get a little bit negative, but obviously.
Speaker 2There's a lot to be positive about. I think, that's really important to say the industry. You know we tend to focus on what's not going so well, which is natural right, but there is a lot to be positive about too.
Speaker 1Yeah, so maybe we'll start there 2030, what industry would be? You know, what are the potential things we're going to see in 2030 that we haven't got available now or aren't? Yeah, what are those positive things?
Speaker 2Well, I think that's what we need to define and I think that's where we probably, as a national industry, are slightly rudderless. I mean, one of the big things that gets talked about. So, you know, we know we're implementing a nationally uniform traceability system. That's been a goal of industry for a really long time. The other side of that is, and it's been, a policy of Sheep Producers. Australia is working towards a value-based system, value-based grading system.
Speaker 2Now, whether that's possible or not, I mean, that's certainly the direction a lot of producers would like to see the industry head in. Is that? You know? Because I think you think about lamb being a premium product. How much more value can you extract out of that product? You know, where are the premiums? Are there premiums? It tends to not be premiums. You know, like, really, we're looking at discounts, discounts. Yeah, what is the future of the industry? Where you know? And is it where producers are getting paid for the quality of the product that they produce? And I guess you know producers in Australia that have been really investing on their genetics and looking to improve the quality of their product but still getting paid on the same grade as everybody else.
Speaker 2And I think you know, in addition to this, and very deliberately with the support of industry, there's been the development of these objective carcass measurement technologies. So DEXA, so measuring your lean meat yield at chain speed, measuring your intramuscular fat at chain speed, doing that all together and then paying on that quality parameter. Now we've got one processor that has actually published their grid as I'm sure you're familiar with Gunnigai Meats Processors that does pay on quality because they have implemented those technologies at their plan and that's been a huge investment on their part and they're getting some fascinating results coming through. And there are producers who are choosing to obviously send their lambs to that processor because they're interested in seeing where they sit and getting that feedback. And that's the critical thing in all of this is information that comes back to the producer that enables them to make better, more informed decisions on farm, and that is just not consistent across the industry at the moment and I say that's a big challenge to implement that industry-wide. But of course this sort of thing is a contentious topic to discuss amongst the industry, largely because there's winners and losers in that scenario and that's a hard thing to sort of frame up when you're talking about trying to progress everybody along that road to industry.
Speaker 2So that's one example, but I think also in Australia, you know, we're certainly seeing, anecdotally, a pretty big increase in the amount of non-shedding sheep, um, that are coming through in production like what is, what is the? What does the flock look like in 2030? That's kind of what I want to be asking our producers on the ground as to what that vision looks like to them, because I don't think it's very clear. But I think I think, you know, at a high level, we want to be well known for quality of our product. We want to be able to for quality of our products. We want to be able to prove that and demonstrate that.
Speaker 2We want producers to be able to have the mechanisms to make those improvements on farm. There's going to have to be a climate and sustainability piece in here in terms of resilience to a changing climate. But yeah, I would preempt what people are thinking in this space, but I think there's a mix of those sorts of issues in there as well as, as you know, obviously, obviously things around productivity as well yeah, I think the saying of I think it was william gibson, not the, not the hairy kiwi bug that works for me, but another william gibson that um said the future is already here.
Speaker 1It's just not evenly distributed, and I think that's. We're seeing heaps of that evidence around here, like gmp and yeah, and others around, the aluminum lamb um coming out of new zealand which we heard from about at the summit, which I think they're extracting sort of 26, 28 bucks per carcass back to the farmer out of the market and obviously and and that's all from hitting those premium customers or hitting chefs in the right spots. And it doesn't happen overnight and happens with a whole heap of hard work and a whole heap of investment. That's right. But those sort of things are happening and need to happen for us to get. If cost of production is $6.50 or whatever it is, whatever that's being quoted at the moment, then we need to be getting some serious money to get the margins.
Speaker 2Yes, that's right, and that's what is talked about in importing countries is the opportunity for premium, premiumization and growing that market segment. I mean, lamb is still so much a commodity, um, and you know we've got important trading partners that that, uh, that need that commodity as well. We look about the global outlook for sheep meat demand and it continues to be forecasted for pretty strong growth. Um, so in terms of providing that light on the hill, there is an immense opportunity for, um, lamb and sheep meat as a protein, um, if we can continue to meet the needs of our consumers. And so what? What is that? And we know that we've got price sensitivity in a lot of markets. But we've also got that premiumization opportunity and you know, I think it's there's been so much success in the lamb industry in australia and new zealand as well, of course.
Speaker 2Um, you know we are already kind of world renowned for for high quality, for a very consistent product in the industry. We know we can continue to improve on that. So you know, what is the customer willing to pay for? I again I question like, how much room is there to really drive that price up? And particularly at a retail level? You know, obviously restaurant trades a bit of a different kettle of fish and there are a few um a few brands at the moment who are putting out some very high eating quality, high intramuscular fat products on the market and having some good success with that.
Speaker 2But that's but. That needs to be a continued piece in terms of our understanding about where the consumer is going to go and when we know that there's going to be really strong growth in particularly middle-class people in lots of different countries, is that going to stimulate growth or how price-sensitive will those guys continue to be? So there's a lot there and I think again in terms of the positivity that we're, that segment is growing and that demand is growing. So how can we meet that need? And I think that's in terms of collaborating with other countries, and we certainly do that with New Zealand. It's all about getting as much lamb on as many plates and menus as possible, and you know that's going to stimulate some good competition as well. So there's a few elements like that too that need to be considered.
Speaker 1Yeah, for sure, and I guess the other way to look at that is cost reduction, and one of the projects that we're involved with that Sheep Producers Australia supported was the feed health work we've started with Animal Health Australia and, yeah, things like that that start taking labour out of our sheep systems and taking cost out of some costs and chemicals and labour, all the things that are reasons that people go out of sheep. If we start reducing them through genetics management, nutrition, then we put ourselves in a better spot as well. There's still constantly in awe, I think, of the opportunity that sits just in all those spaces to improve what we do and therefore be more profitable.
Speaker 2I totally agree and you know, underlying this whole conversation, I guess, is this issue of extension and supporting people to make changes on farm, and we do. This is a topic that gets brought up a lot around our National Policy Council table, our board table, our members. It's just the rate of the adoption in the industry and you know we've got that 10%, 20% of producers, or 10% 15% of producers at the top. They're the early adopters, they are taking up all of these opportunities. We have a good subset of producers underneath that who are interested, but maybe you know what are their needs and drivers, and cost is a big part of that, as you're talking about. But like, are we supporting the industry? You know, because our model, I suppose, since we've had state agencies withdraw from the extension space, private providers who are doing a phenomenal job, can they do the job? Like, how do we encourage producers to take up these practices? Because it's large, it can be a lot about cost, but that's not always the main driver, as we will know as well.
Speaker 2So, yeah, I'm always concerned about the capacity of our sector to continue to evolve and how we support them to do that. And it's a very expensive ugly question that one and, uh, I know some producers have very strong views on on that as well as to. You know, it's definitely the responsibility of the producer. But I mean, we're still having difficulty getting uptake of scanning, you know, and that's like like the golden era of um, of extension in in act, but going back to sort of 50s, between the 50s and the 70s, like stuff that's been well-known for a long time that has not been adopted. Why is that?
Speaker 1Yeah, that's true.
Speaker 2And what do we do about that?
Speaker 1Yeah, I've drank more than one beer having that discussion, I can guarantee you.
Speaker 2Yeah, that's a usually a red wine, a bottle of red wine conversation in my experience, yeah and yeah. I've only read one conversation in my series.
Speaker 1Yeah, and I guess if we do think about sector capacity then yeah, the research game, the work out through the standard sort of state government department in the Department of Ag with various names, and where there was lots of people at the research institute I worked at and then that has been decimated and everyone like it has been decimated and like all our yeah, I said I wasn't going to get negative.
Speaker 1But anyway, we are in a position where research capacity is probably I don't know, it feels like at an all-time low, and the extension capacity is probably the same in terms of what we traditionally saw as government roles. So it is left to the university sector and the private sector really, to where a lot of that's happening now, which is a quite a shift and and yeah, and that's obviously what we do for a living, but yeah, it is. It's an interesting time and I think about, yeah, who are the next? Who are the next cohort coming through in with research capacity? And that's, um, I guess the right. Yeah, the people out there. When you hear of things like Impossible Foods with their 400 scientists and whatever, and I think if you added up all the scientists across Australia and New Zealand that are working in sheep, you wouldn't get a number anywhere near like 400. And so it's an interesting, interesting issue.
Speaker 2Yeah, no, I mean the capacity generally speaking of the industry is a key issue, and not even just across research, but certainly in our vet space as well and a few other areas I think you know.
Speaker 2If you ask producers, I think this is where there's probably an expectation. When I speak to a lot of producers anyway around where their levy goes and what it gets spent on and the amount spent on research, and you know there'll be people who say, well, there's no point doing research unless it's going to be adopted right. Like you know, there'll be people who say, well, there's no point doing research unless it's going to be adopted right. Like you know, that's not. Obviously we're going to do more blue sky research and things that are not always going to necessarily lead immediately to an adoption pathway, but I think that's the expectation of industry in terms of where their dollars go. We've got a bit of a gap in terms of who delivers that, and I certainly talk to researchers around their concerns about the next generation coming through, which I do find interesting when I think about people who are taking up, you know, degrees in agriculture and animal sciences that can go on to have a future in research if they so wish. But are they going to target that at our industry and the livestock sector or are they going to go elsewhere and how do we capture that? What are the opportunities for them and what role should industry play and organizations like ourselves in terms of shoring up that future? You know, I think we've sort of had a bit of a market, like you know, sort of let the market do what it's doing around. That to a certain extent I'm definitely not dismissing, like the really good work of MLA and others and service providers in providing opportunities for early career researchers and things like that.
Speaker 2But you know, when we talk again, I talk about sort of a growth strategy type approach for the industry. It's capacity building, something that we need to address, and how do we do that? What's our sphere of influence? And again, like I said, I think for a lot of conversations that we have with producers it comes back to, you know, where's the levy being invested and what proportion of that is going towards adoption and extension activities to make sure that those practices are being picked up and that there is a pipeline for researchers to continue to sort of work into and that they see a strong future in it.
Speaker 2I think that's the challenge we've got as well in the vet sector in terms of vets graduating and going into being a sheep vet in that profession. You know there's certainly concern around that we're losing experienced people out of the industry and you know even just that as an example amidst the many others to do with the capacity issue. So, yeah, I think this is a hot one for us to work through. I'm guessing it's the same in New Zealand and one of our producers has said to me what is the Yellowstone of the sheep industry? How do we make it sexy? How do we make it continue to be something that people want to be a part of? And that's where I'll be calling upon certainly some of our leaders in our industry to help inform and advise us on what we can do there.
Speaker 2But I think it's an issue across the board in the livestock space and, yeah, I think to broaden your point that you made around, you know your alternative protein kind of sectors who are very heavily and well invested in, particularly by corporates like yeah, how do we compete with that in terms of attracting that sort of level of attention and investment and how much does that impact on our future? I think the rate of the development of those alternative proteins has certainly not been as quick and as strong as perhaps we were thinking it would have been maybe five years ago. They're going to continue to bubble along, but they're not taking the majority amount of market share. So, yeah, these things are also trying to weigh out what risk and what impact they have impacts on what decisions we make about what to do with them. So, yeah, I don't have all the answers, but there's certainly things that we talk about a lot.
Speaker 1Yeah, definitely that's the real question is, yeah, how to get more or more bonnie skinners coming through. They're falling in love with horses and having the gateway drug into the sheep industry. I mean, that's essentially what we're talking about, isn't it? It's that five-year-old that goes on a farm and decides they're going to have a career in industry. That's the sort of stuff that drives change and I don't know. Yeah, you obviously think a lot more about policy than I probably ever will, but to a certain extent it probably ever will. But to a certain extent it is. Market forces are what controls the world, and so obviously there's influence in and out of that. But essentially there needs to be everything's got a supply-demand curve, and that's where we can tweak the edges and we can set things up for success or failure. But essentially we need the value proposition to be good, which I guess starts at the full circle back to a profitable sector and a well-resourced sector.
Speaker 2Well, that's like you know, if we take not to take a slightly different tact, but a similar tact, it's, you know, this whole discussion around climate and I mean that you know in all the things that we're talking about and again, not to be negative, but I mean that is a major existential issue for our industries globally and the challenge that we've got in Australia and very different policy environment to what you guys are sort of dealing with in New Zealand is around.
Speaker 2I mean you guys have a lot more policy clarity on that front. We have targets and we have our aspirational industry target of C and 30, but what we really are grappling with at the moment is a complete lack of incentives for people to start to take up new practices, and that's even just undertaking accounting on farm and this kind of sort of standoff I feel is happening in the policy space around this issue, whereby really to sort of try and put a reasonable framework forward for the industry. Industry needs some policy certainty and clarity. Government wants industry to tell it what it thinks that should be, and there probably is an expectation from people in industry that government should be the ones doing that, albeit it would probably get an awful response from industry, I mean our government obviously the ones doing that, albeit it would probably get an awful response from industry.
Speaker 2Yeah, I mean our government. Obviously it's not quite as black and white as that, but I mean our industry has talked about split gas approach and things like that with government. There's certainly politicians that have no interest in taking that approach, but I mean, yeah, if we're talking about an industry like, the main source of any resilience is going to come from really strong commercial performance. Any resilience is going to come from really strong commercial performance that's going to continue to fund investment and confidence and acceptance of change, which is underpinning everything we're talking about right now. And so that's completely at odds with the costs of what it's going to take to start to reduce our emissions, particularly in the absence of really strong R&D solutions to reduce methane.
Speaker 2So, yeah, I think producers have the ability to adapt their businesses over time, over a reasonable timeframe, if there is clear kind of framework to work towards. But in the absence of that, it is a very difficult proposition, and I think you know that's the same with the live export sector issue that we're dealing with in Western Australia. Obviously, we're not in support of phasing out that trade whatsoever, but there's a complete hole in the discussion at the moment. That always has been around the lack of certainty around what timeframes they want to undertake it within and how quickly they want to do it, what sort of support will be given, and they want industry to volunteer that information when industry is opposed to the change. So it's yeah, you know, commercial performance is everything in this, and that's the other element that we've got to consider as well.
Speaker 1Yeah, yeah, I think it's hard to go. Yeah, I guess I can't unsee a cartoon that came out around COVID when, sort of COVID being a little wave and then this enormous wave coming of global warming, which sort of everyone thought COVID was the well at the time. It was the most awful thing ever. But really yeah the challenge that humanity is facing in the next few decades is yeah, and it doesn't matter which part of industry, which industry and which part of.
Speaker 2Yeah, well, and that's like in terms of global collaboration and cooperation. I mean, that is the biggest driver for that. You know we're involved in a forum called Global Sheet Producers Forum where we've got, you know, the main sheet bodies from a lot of different sheet producing nations coming together. We talked about this last time that we met. Certainly, myself and staff from Beef and Lamb, new Zealand, talk about this all the time. How can we collaborate more effectively to really make sure that we're scaling up the investment and the technological breakthroughs that we need for our sector? You can put that against. You know well what's the responsibility of the other fossil fuel industry sectors. Well, they're going to be able to decarbonise realistically, some of them a lot quicker're going to be able to decarbonise realistically, some of them a lot quicker than we will be able to. And really realistically, what can we do right now? We know that there's some really exciting stuff happening around genetics. There's things that people can be doing with their pastures and their management, but it's very small incremental adjustments and a lot of time.
Speaker 2I think the other thing as well is is the huge talking about capacity, like that huge upskilling as a we think about produces a workforce. That has to happen around. I mean I did a carbon and um accounting course that's that's run here in australia, great course. But I mean I was like that was, that was difficult for me to work through and it was done. It's an intensive, you know, or two-day course, but I'm thinking we've got to get everyone doing this on their farm. There's no monetary benefit for it at the moment. There's no gain realistically.
Speaker 2But even just undertaking the carbon account, which calculator you use? Who to trust where the information needs to? You know the trust and information comes from everyone's grappling with that and I just think how we've got to upskill a whole generation and I think we've got a really good opportunity with younger people coming through there to sort of use technology to make those things easier. But what are the tools that can help people now to do this job? I worry about that and that's one of the things that we're working through at the moment and will continue to work through is, yeah, that capacity building piece.
Speaker 2So, yeah, collaboration technology we need to buy some time for ourselves. We need our government to really take some strong advice from industry on the science around this, which I think has been really lacking for a long time and, unfortunately, our finance sectors and our government policy is outpacing probably this, not outpacing the science, but it's already outstepped the science in terms of and it's kind of put its line in the sand, I guess. Yeah, you know. So a few challenges there on the policy front for sure, and would be the biggest issue, you know.
Speaker 1Yeah, they keep continuing to ignore the fact that half the life of methane is 12 years. Just blows anyone's mind. But anyway, that's.
Speaker 2Well, methane is a tricky, tricky issue and I think you know we've had a lot of calls from people around wanting to use GWP star as a metric rather than GWP 100. And you know the Climate Authority has, and you know the Climate Authority has supported, you know, anyone using additional metrics in terms of GWP 100 to be able to clearly articulate what are warming impacts. Methane's a wicked issue for us because it's yeah, it's got a shorter life, but whilst it's in the atmosphere it has a much higher warming impact. So, you know, whilst we've got a stabilized flock and herd using those metrics, it is going to be great. But if we're looking to increase our flock, um and that's that's really what needs to be modeled, particularly in australia, about flock projections now between now and 2050, I mean there's a lot of work that needs to be done before anyone can have confidence to throw out one lot of metrics and start going with another.
Speaker 2So we're using all those metrics, but I think people have gotten lost, as you well know, around reporting on warming impacts versus just carbon and this obsession with becoming carbon neutral, which for our sector, the whole of the ag sector is very difficult. We're very difficult to abate sector. We have a very important role in feeding the world, and that's population growth, and everything is going to need to be supported by a really strong food and fibre sector. So, yeah, that's a shade of a great conversation. That's another bottle of wine conversation, yeah, yeah, I've got to remember I'm on a podcast, yeah, yeah.
Speaker 1It's half on a Friday afternoon. Well, it's not afternoon yet, yeah, but it is. Yeah. Anyway, there are issues that are all. I'm sure that's your day discussing those things and trying to navigate those solutions. And, yeah, none of it can be solved, otherwise we would have done it by now. It'll be solved, but not by one afternoon on a podcast, but yeah, we might wrap it up. Bonnie, that's been a fantastic chat and I really appreciate your time. I know you're flat out doing lots and lots of things, so I really appreciate taking a bit of time out to have a yarn and I'm sure the listeners will hopefully enjoy us having a chat randomly about stuff in the industry. No, a bit of time out to have a yarn and I'm sure the listeners will hopefully enjoy us having a chat randomly about stuff in the industry.
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Speaker 2No, thank you very much for having me and I don't think we went too hard into the negative. I think we walked a kind of reasonable line there and, yeah, I mean, if anyone wants to chat to me about any of the things we've talked about, I'm really I'm always very happy for people to reach out. We need, really we need people who are engaged and interested and who are strong advocates for the sector, and that's certainly what helps me do my job effectively. So thank you so much for letting me have a chat. Sorry for talking too much. Hopefully talk to you again, excellent.
Speaker 1Yeah, well, we'll put your contact details in the show notes, is that?
Speaker 2Yeah, happy for that.
Speaker 1Yeah, cool, excellent. Thanks very much.
Speaker 2Thank you.
Speaker 1Thanks again to our mates at Heinegger, who are proud world leaders in the manufacturing and supply professional sheep shearing and clipping equipment. They understand that their customers rely on the quality and performance of their products each and every day. Also, thanks to our friends at MSD Animal Health and Orflex, they offer an extensive livestock product portfolio focused on animal health and management, all backed up by exceptional service. Both of these companies are wonderful supporters of the Australian and New Zealand livestock industries and we thank them for sponsoring the Head Shepherd podcast.
