The industry outlook is bright, and we look forward to stronger beef and livestock demand in the second half of 2024.
The fundamentals for the industry remain strong with global population and increasing middle class across the world growing. Demand for protein will continue to increase. Our major customer in the US is entering a rebuild phase post significant drought sees one of the lowest beef cattle herds on record leading to strong demand for Australian beef – particularly lean trimming for hamburger production which typically underpins the cow prices in Australia.
This operating environment is important when we look at the role of Herefords Australia to support our members to drive progress for the breed as well as secure the future of the business.
This brings me to the progress of the Herefords Australia Strategic Plan. The strategy provides the framework for the Herefords Australia business, and it also enables the directors to have oversight of the direction of the company.
The board undertook a review of the progress of the strategy at the December 2023 meeting as this was the halfway point in the strategy in its five-year time horizon.
A major announcement from last year was the focus of the business would be sustainability. We have defined sustainability under key productivity drivers that support both the economic and environmental sustainability of our industry.
This approach also positions Hereford cattle at the forefront of industry innovation by being a significant contributor to the solutions the industry needs.
The key factors defining sustainability for Hereford cattle are:
– Fertility
– Longevity
– Weight for age
– Feed efficiency
– Carcase quality
By focusing on these attributes that Hereford cattle deliver so well, we offer solutions to major industry problems. It also positions Hereford cattle as the breed of choice in cross breeding programs.
Within the remit of the board, we continue to focus on the effective governance and fiduciary responsibilities.
The Finance Audit and Risk Committee remains an integral board committee chaired by Mark Baker and focused on the active management of the investment portfolio. Sam Broinowski, Mark Baker and Michael Crowley have worked with Morgan Stanley on the active management of the portfolio. Morgan Stanley Australia have been regularly reviewing the market and making strategic recommendations that go back to the committee to ensure the risk appetite of the portfolio is met whilst also maximizing returns.
The R&D Advisory Group have met several times through the year to discuss key strategic R&D priorities. The group went through a prioritisation process to recommend the R&D focus for HAL. Hamish Chandler has completed an index review which will lead to new index adoption and genomic technologies with Neogen and will be commercialized by the end of the year. The group has also discussed the approach HAL is recommending tackling issues such as new genetic defects.
We were alerted to a new genetic defect this year – Delayed Blindness. The business has developed a matrix to review the risk and develop a robust process to determine the size of the impact for the breed to determine next steps.
Neogen have a test available in Australia which will enable us to undertake targeted testing and develop more information about the prevalence in the Australian population, establish the size of the risk and to determine the approach to manage/eliminate the condition. It is important to note there is no known affected animal in the country. HAL is taking this very seriously.
We are in a time of change with Michael departing HAL after two years on the board and the last 15 months as CEO. What we have benefited from over the last three years is stability on the board, succession plans for business-critical roles and continuity between CEOs with Lisa and Michael.
I would like to assure you all the business is in good shape and the next CEO will be able to keep the momentum going. With the strategy in place supported with an implementation plan and individual work plans, the team is well positioned to keep core services going while we recruit for a new CEO.
We have a deeply committed and passionate membership and I really appreciate that. There is a lot of information shared from HAL and I would like to hear more ways of how to make sure that information is more effective for our members. We have multiple platforms across social media, print media, website, and member emails. We ensure members are well informed and we can share messages from HAL that support driving our businesses forward.
I see a lot of opportunities for the breed, and we will only be successful if we can collaborate as a breed and align with addressing our customers’ needs and demands.
Regards,
Ian Durkin IMMEDIATE PAST CHAIRMAN
