Australian Wagyu Conference - Day 1

In trying to condense the long day of talks, one over-arching theme kept being repeated: the worst drought in history is taking place in Australia. It affects 1/3 of the entire country - and it is taking a great toll on the Wagyu industry here.

The conference reflected for me a mature organization, with many warm and friendly members. I made many friends over the short conference. The discussions were smart and instructive - and the dialog was sharp. It was quite well organized and reflected serious but lively intentions.

Of note: The Australian Wagyu Association has 317 full members and 52 associates. In 2006 there were 2167 Full Blood registrations and about 1400 transfers in registrations. This compares to 1800 registrations in 2005 and 1200 transfers last year. BREEDPLAN (the organization that provides EBV's or EPD's) has recorded 8000 animals in their database and expects the first run to be done early next year - with Michifuku as the reference sire.

The AWA website gets 2200 visitors a month - and 65% of them are new to the site.

Peter Bishop welcomed everyone and said that the most important thing for Wagyu ranchers was product integrity - be truthful. If you do not know the pedigree, DNA the animal. Sell no pregnant heifers unless the buyer is told. In order to meet demand, the number of animals need to move from the current 80,000 to 300,000. Two new abbatoirs are being built - one at a cost of $100 million. Russia and China represent huge new opportunities for the Wagyu breeder.

After the AWA Annual meeting, we broke for morning tea and crumpets. I spoke to a couple who told me that at last year's meeting they heard a talk about weaning calves at 6 weeks! Another person told me he had bought a young Wagyu bull who covered 100 females and 97% became pregnant!

Then the first speaker - David Connell, from AACo - talked about international marketing. AACo, an enormous Australian agricultural company, owns 625,000 cattle - 2,000 Wagyu and has 12,000 Wagyu-infused on feed - 500 to 600 Full Bloods included.

Price is an issue, especially here during the drought - hay is running around $450AU per ton. But globally demand is high; the Australians are benefitting from their clean, green image; and the EU also presents new opportunity.

The take-away: Price is built on quality. And Brand Protection is essential.

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Miho Kondo spoke about Wagyu labeling in Japan. There is a protection movement growing in strength in Japan - and the Wagyu logo is under review. Cattle must be derived from cattle born and raised in Japan and accredited by the Japanese Wagyu Association in order to be labelled Wagyu.

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Ewan Colquhoun spoke about food miles - which is more or less, buy and eat local. He talked about the growth of organic, sustainability, animal welfare, food image, fair trade, and producer welfare - ultimately, all decisions are made by the consumer. Organic has grown 15-20% a year - in the US 24% of consumers buy organic once a week, up from 17% in 2000. Even Wal-Mart is entering the organic market.

He also talked about the opposite side of the equation: in the UK, more energy is used in greenhouse warming to grow tomatoes than Spain uses and ships to the UK; what is the carbon impact on food, both in production and transportation; hard to maintain across all seasons; Fiji bottled water will eclipse sugar as the major export of Fiji - sugar employs 40,000 workers, bottled water employs 200.

Food miles is food for thought.

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John Houghton gave a Wagyu market report: Australia has competition from South America - and resistance from Japan - and the re-entrance of US into the marketplace will have an effect on Australian profitability. The age increase (to 30 months) proposed by the US is under consideration. A tough market faces Australian producers over the next 12-18 months. The drought and higher production costs are the prime reasons.

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Break for a delicious lunch.

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After lunch Dr. Christine Jones spoke about returning carbon into the soil. In a rather controversial talk, she asked, "Who ever said that carbon emissions are causing climate change?" I was left a little speechless - espcially coming after the interesting talk about food miles. There was no one (except an organic farmer who said that he was organic about everything, but used a great deal of fuel getting things done) who really challenged Dr. Jones on her position.

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Dr. Glen Anderson gave a lengthy talk about diagnosing parasite invastion and parasite resistance. It was quite informative, but focused on Australian parasites - and I am certainly not an expert on that... He said when in doubt, take a good look!

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David Hanlon gave a long talk about real estate vs beef business - an analysis of your business plan that I must admit went a little over my head... maybe i was in need of another crumpet or two...

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Then Belinda Hays, of AUSTRADE, talked about emerging markets. I was stunned to learn how much help and assistance the Australian government gives to its agricultural producers. AUSTRADE seems like a great organization - I am unsure if there is an American equivalent, but I tend to doubt it... They will even help a producer pay for a trip to foreign countries to explore the possibilities of export.

Her take-away: Consistent Quality!

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Finally, Sam Bailey spoke. It was inspiring and emotional to hear his story. He became a quadraplegic at age 19 - a result of a terrible car accident. He told how he overcame despair and depression and pulled his life back from the abyss. He has partial control of his arms and his next goal is to fly a helicopter. He has written a book with his young wife (a former radio personality) and lives on his farm. What a story to end the day's conference!

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Afterwards, a long dinner overlooking the river running through Brisbane - with a loud auction of wine and beef - all to support the Australian version of Doctors without Borders. I was asked to draw the winning lottery ticket - and did so, after a few short remarks about how grateful I was for the friendship of everyone and the opportunity to witness such an informative day.