Sheep producers shocked by Shark Lake abattoir closure as Minerva Foods decision hits home

The phone is dead, the doors are closed, and Esperance livestock producers are wondering what to do with 60,000 lambs after Minerva Foods Australia suddenly halted operations at its Shark Lake abattoir to undertake “a review of operations”.

ASHEEP grower group president and Scadden farmer David Vandenberghe said while MFA chief executive Iain Mars was undertaking a review “to fully analyse what further investment is needed” in the meat processing plant, he was doubtful it would reopen.

“It certainly makes it difficult for producers who have been battling all year to get sheep processed,” Mr Vandenberghe said.

Mr Vandenberghe said producers found WAMMCO at Katanning was “booked out” and they have had to freight sheep to V&V Walsh at Bunbury, pushing up transport costs by $5-$7 per head.

Salmon Gums mixed farmer Greg Kenney said he had 500 lambs scheduled for processing at the facility next week an would have to “hold them on-farm” through the summer.

He feared by the time he found alternative processing they would have become hoggets, worth $60 per head less than if sold as lambs.

“At least we have sufficient feed and water on hand to carry them through,” Mr Kenney said.

“We’ll also be able to shear them as they’ll have about eight months wool by then.”

Mr Kenney said the sudden decision by MFA would remove much needed “cashflow” from his normal spring operation.

Mr Mars closed the plant on September 11, about 14 months after opening it as part of a joint venture with the Saudi Agricultural and Livestock Investment Company, which was a surprise to its 150 employees as well as WA suppliers.

He said staff would be redeployed to other facilities within the MFA group, where possible, with “a small number taking up redundancies”.

The South American owned MFA is expected to fulfil all existing meat orders through its operations at the Great Eastern Abattoir at Tammin and Colac in Victoria.

The Esperance facility had the capacity to process about 9000 lambs a week, while 5000 head could also be processed at Tammin, with 90 per cent of the total product exported predominantly to the Middle East.

Pastoralists and Graziers Association of WA Livestock Committee chair and Eneabba sheep producer Chris Patmore said the MFA decision highlighted how difficult it was to operate an abattoir.

“It’s disappointing to see a reduction in sheep processing in WA,” Mr Patmore said.

“It’s not an easy business to be in.

Mr Patmore said the WA sheep industry needed “all the competition it could get” within the processing sector, especially at a time when the Federal Government was working to phase out live sheep export.

MFA originally sought to invest $50 million in the WA processing sector to boost its Australian operations, mainly due to the presence of the Saudi Agricultural Livestock Investment Company which purchased a 211,000ha portfolio of farmland from John Nicoletti in 2019.

SALIC operates under the Merredin Farms brand and would sell lambs to MFA as part of the arrangement.

MFA is the second South American entity after JBS to invest in Australian meat processing.