In 2015 Maranoa Regional Council developed a Pre-feasibility Study to demonstrate the viability of the concept to build and operate a meat processing facility in Roma. 

The study established that the $84 million plant would be economically viable on the basis of processing 600 head of beef cattle during two shifts per day.  Accordingly, it is reliant on ‘supply’ of sufficient fat cattle on a daily basis.

Business Case
The business case for a meat processing facility at Roma is based on the following
key elements:

  •  Increasing market options for cattle producers in Southern Queensland;
  •  Reducing the supply chain costs, particularly in the transportation of livestock;
  •  Accessing lower production costs available from a modern meat processing facility;
  •  Creating significant direct and indirect community benefits from employment and associated industries; and
  •  Improving animal welfare from reduced transportation and handling.

Concept
The key characteristics of the proposed meat processing facility are:

  • Single species facility: The trend in Australian meat processing industry is toward single species facilities. This together with the assessed current lack of opportunity for sheep and goat processing (or other alternate animals) means it is proposed that cattle be the only species processed at a Roma facility;
  • Capacity: The proposed facility is based on 300 head per shift operating two shifts per day, 240 days per year with one shift being a ‘hot boning’ system and one shift being a ‘cold boning’ system. This results in an assumed total throughput of 144,000 head per annum;
  • Capital expenditure: The capital cost of a facility has been estimated by Wiley & Co Pty Ltd (‘Wiley and Co’ or ‘Wiley’) to be $77 million to $86 million (excluding any Government grant);
  • Site: An initial assessment suggests there are at least three potential sites that potentially meet the criteria set for a meat processing facility. The potential sites have been selected due to the area, access to infrastructure and minimised impacts on the community, environment and cultural sites; and
  • Products: The products to be produced by the planned facility are: primal cuts; offal, tripe and intestines; tallow; hides; and value added products.

The final product mix will ultimately depend on the type of facility, whether it is owner/operator or service-kill and the contractual agreement between the parties involved.

Target Market
A growing global beef market means a Roma meat processing facility is not expected to have difficulty in finding markets for its products. However, without an established industry participant, there may be lags in securing markets which attract the price premiums of competitors.

Cattle Supply
If there was a commitment now to build a Roma meat processing facility it would be likely to open at a time when the number of slaughter cattle available in Australia will be at historic lows. Slaughter cattle numbers in 2017 are expected to be 6.9 million head, a decline of 2.3 million head from the recent high of 2014. The biological lifecycle of cattle restricts its ability to respond quickly to price increases.

However it is expected the significant increases in cattle prices this year, if sustained, will result in a significantly higher Australian cattle supply over the medium term.

Due to the short term supply constraints the viability of a Roma meat processing plant would likely require a cattle supply commitment to ensure at least breakeven volumes for processing in the early years of operation. The supply commitment may be from a vertically integrated company which has a cattle production business.

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