The Australian Meat Processor Corporation (AMPC) and the Australian Meat Industry Council (AMIC) have appointed business consultancy EY (formerly Ernst & Young) to carry out the review.
It will offer analysis and recommendations on whether dual energy X-ray absorptiometry (DEXA) technology would benefit the Australian meat industry.
The review will look as all aspects of what is known as ‘Project 150’ – a Meat and Livestock Australia (MLA) scheme to pump AU$150 million into industry-wide objective carcase measurement technology by 2020, which would be made possible through the installation of DEXA.
Benefit to industry
AMPC chairman Peter Noble said DEXA technology was “yet to be sufficiently proven”, adding that proper consultation, cost-benefit analysis and due diligence was needed before he felt comfortable investing industry money into DEXA.
“We take our obligation very seriously to provide members with a comprehensive fact-based approach to investment decisions to ensure their funds are spent in ways which will benefit them and the industry,” Noble added.
AMPC has already invested, or committed to invest, AU$6.6m of processor levy fees in carcase measurement technologies.
AMIC chairman Lachie Hart said mismanagement of the project to install DEXA technology in all AUS-MEAT accredited factories by 2020 could “encumber” an industry he claimed faced “unprecedented cost pressures”.
“Until our members can be confident that this technology will provide a more independent and accurate way to grade and price carcases, we risk undermining the integrity of the cattle pricing process,” Hart said. “If we get it wrong, it would be a costly and backward step.”
Teys Australia, which describes itself as a “leading innovative producer of red meat”, will trial the DEXA technology alongside the EY review.
Andrew Metcalfe, federal governance lead partner at EY, will head up the review. He has previous experience of the meat industry after working on an AMIC report that assessed strategic risks facing the sector.
Report findings are expected to be made public in April 2017.