Australia: ACCC market study into the beef and cattle supply chain

Last Updated: 4 May 2016
Article by Mihkel Wilding, Kirsten Webb and Andrew Hay

Key Points:

The ACCC market study into the beef and cattle supply chain aims to discover how effective or competitive the market is.

The ACCC is calling for submissions and information in response to its recently announced market study into the beef and cattle supply chain, led by new ACCC Agriculture Commissioner, Mr Mick Keogh. Initial submissions are due by 6 May 2016 and the study is expected to conclude in November 2016, after public consultations, publication of draft findings and release of the ACCC final report.

Recent Government action in the Agricultural sector

The Government is "committed to strengthening the [agricultural] sector and ensuring it remains as competitive as possible, because stronger farmers mean a stronger Australian economy." Over the last 18 months, it has published a White Paper on Agricultural Competitiveness, conducted a Senate Inquiry into the effect of market consolidation on the red meat processing sector, allocated significant additional funding ($11.4m over four years) to the creation of a new specialist agriculture unit, created a new Agricultural Engagement and Enforcement Unit within the ACCC, and appointed a new Agricultural Commissioner to the ACCC, Mr Mick Keogh.

Agriculture is a key ACCC priority

The ACCC has identified agriculture as a key priority in 2016.

Beef production is the most common agricultural activity in Australia with approximately 57% of Australian farm carrying beef cattle, with approximately 74% of beef production exported. Since mid-2014, Australia cattle prices have risen to record levels. The beef supply chain is described by the ACCC as complex, being made up of producers, processors, exporters, retailers and consumers.

The Agriculture Unit will be dedicated to identifying fair trading and competition issues within the sector in order to enhance its competitiveness and efficiency. The ACCC has indicated that "the new Agriculture Unit will focus on investigating potential breaches of the Competition and Consumer Act and, where appropriate, taking enforcement action; increased engagement with the agriculture sector [so farmers know their rights]; and advocacy on agriculture issues, including through the use of market studies."

The establishment of the Agriculture Unit follows recent complaints within the sector about potential anti-competitive activity such as collective boycotts by processors at a cattle saleyard Victoria, which the ACCC investigated but ultimately decided not to pursue. In announcing the market study, ACCC Chairman Rod Sims noted: "The combination of issues raised through the Senate Inquiry and the ACCC's own work has led us to undertake this market study."

The Cattle and Beef Market Study

A market study involves a long-running investigation into a sector (not a particular business or entity) pursuant to which the ACCC can use its compulsory powers to collect information and assess in its opinion whether the market structure results in an effective or competitive market outcome. The ACCC can use these powers to identify what it or other agencies can do to improve those outcomes.

On 7 April 2016, the ACCC released its Issues Paper for the market study. Broadly, the study will examine competition, efficiency and transparency in the beef and cattle supply chain in order to identify whether any behavioural or structural impediments exist which adversely affect the operation of that supply chain.

The Issues Paper contains 34 questions, split into three key issues:

  1. markets for the sale and purchase of cattle (including the operation of different sales methods and the commercial risk between participants, transparency of pricing and grading methods, geographic or transport limitations on competition and the role of livestock and buyers' agents);
  2. the processing sector (including access to value add products from abattoirs, barriers to entry and expansion in the processing markets and the availability of information regarding sale of processed meat such as margins, costs, prices and profitability of production); and
  3. markets for the sale of processed beef (export and domestic).

Some specific areas of interest include:

  • differences in bargaining strength between buyers and sellers of cattle in different purchasing situations, eg. at saleyards, in the paddock, over the hooks, forward based contracts;
  • whether there are opportunities for farmers with weak bargaining power to use co-operatives or collective bargaining arrangements;
  • the horizontal and vertical integration of processors and whether/ how this has affected competition and efficiency in the market for the acquisition of cattle;
  • whether the consolidation of saleyards has had an effect on the number and location of saleyards, and the fees charged;
  • potential collusive behaviour, for example, by meat processors boycotting auctions at saleyards;
  • the transparency of pricing levels and services levels implemented by abattoirs;
  • the effect of a seller's geographic location on access to particular sales channels;
  • the strength of competition between processors for the acquisition of cattle and the wholesale supply or processed meat;
  • the reasons why some processors are closer competitors than others eg. processing capacity, products similarities and differences, production costs, geographic proximity to abattoirs and downstream customers; and
  • margins, costs and profitability within the industry and how this has changed over time with the consolidation of the processing sector and growth of export markets.

Possible outcomes of the ACCC Market Study

The Issues Paper identifies a range of possible outcomes from the market study. These include:

  • the recommendation of measures to improve transparency and fair trade practices in the supply chain;
  • increased assistance to industry participants about their rights, obligations and options to encourage effective competition;
  • opportunities for the ACCC to make recommendations and/ or work collaboratively with the Government and industry to develop solutions to any issues identified market study;
  • further investigation by the ACCC of specific concerns that might give rise to actions under the Competition and Consumer Act 2010, for example, through the issuing of compulsory notices;
  • depending on the outcome of those investigations, ACCC enforcement action through the commencement of court proceedings.

How to get involved

The ACCC is calling for submissions and information from participants at the following levels of the supply chain:

  • producers/ farms/ farmers;
  • sellers agents acting on behalf of producers;
  • buyers agents acting on behalf of a retailer;
  • processors;
  • export and domestic customers.

Submissions can be made in writing or orally. The ACCC has also stated that it will have in place a robust confidentiality regime and accept anonymous submissions so that submissions are made candidly and without fear of retribution by stronger industry participants. The due date for initial submissions is on 6 May 2016.

The ACCC will also be conducting public forums in Queensland, New South Wales and Victoria (dates and locations to be announced in May). As has occurred with other market studies, the ACCC will also engage directly with some market participants.

The ACCC has indicated that it will publish draft findings for further comment in September. Its final report is due in November 2016.

We are available to assist you if you would like to participate during the process, or if the ACCC contacts you directly to request specific information. Please contact us if you would like to have a more detailed discussion.


You might also be interested in...

Clayton Utz communications are intended to provide commentary and general information. They should not be relied upon as legal advice. Formal legal advice should be sought in particular transactions or on matters of interest arising from this bulletin. Persons listed may not be admitted in all states and territories.

To print this article, all you need is to be registered on

Click to Login as an existing user or Register so you can print this article.

Some comments from our readers…
“The articles are extremely timely and highly applicable”
“I often find critical information not available elsewhere”
“As in-house counsel, Mondaq’s service is of great value”

Related Topics
Related Articles
Up-coming Events Search
Font Size:
Mondaq on Twitter
Mondaq Free Registration
Gain access to Mondaq global archive of over 375,000 articles covering 200 countries with a personalised News Alert and automatic login on this device.
Mondaq News Alert (some suggested topics and region)
Select Topics
Registration (please scroll down to set your data preferences)

Mondaq Ltd requires you to register and provide information that personally identifies you, including your content preferences, for three primary purposes (full details of Mondaq’s use of your personal data can be found in our Privacy and Cookies Notice):

  • To allow you to personalize the Mondaq websites you are visiting to show content ("Content") relevant to your interests.
  • To enable features such as password reminder, news alerts, email a colleague, and linking from Mondaq (and its affiliate sites) to your website.
  • To produce demographic feedback for our content providers ("Contributors") who contribute Content for free for your use.

Mondaq hopes that our registered users will support us in maintaining our free to view business model by consenting to our use of your personal data as described below.

Mondaq has a "free to view" business model. Our services are paid for by Contributors in exchange for Mondaq providing them with access to information about who accesses their content. Once personal data is transferred to our Contributors they become a data controller of this personal data. They use it to measure the response that their articles are receiving, as a form of market research. They may also use it to provide Mondaq users with information about their products and services.

Details of each Contributor to which your personal data will be transferred is clearly stated within the Content that you access. For full details of how this Contributor will use your personal data, you should review the Contributor’s own Privacy Notice.

Please indicate your preference below:

Yes, I am happy to support Mondaq in maintaining its free to view business model by agreeing to allow Mondaq to share my personal data with Contributors whose Content I access
No, I do not want Mondaq to share my personal data with Contributors

Also please let us know whether you are happy to receive communications promoting products and services offered by Mondaq:

Yes, I am happy to received promotional communications from Mondaq
No, please do not send me promotional communications from Mondaq
Terms & Conditions (the Website) is owned and managed by Mondaq Ltd (Mondaq). Mondaq grants you a non-exclusive, revocable licence to access the Website and associated services, such as the Mondaq News Alerts (Services), subject to and in consideration of your compliance with the following terms and conditions of use (Terms). Your use of the Website and/or Services constitutes your agreement to the Terms. Mondaq may terminate your use of the Website and Services if you are in breach of these Terms or if Mondaq decides to terminate the licence granted hereunder for any reason whatsoever.

Use of

To Use you must be: eighteen (18) years old or over; legally capable of entering into binding contracts; and not in any way prohibited by the applicable law to enter into these Terms in the jurisdiction which you are currently located.

You may use the Website as an unregistered user, however, you are required to register as a user if you wish to read the full text of the Content or to receive the Services.

You may not modify, publish, transmit, transfer or sell, reproduce, create derivative works from, distribute, perform, link, display, or in any way exploit any of the Content, in whole or in part, except as expressly permitted in these Terms or with the prior written consent of Mondaq. You may not use electronic or other means to extract details or information from the Content. Nor shall you extract information about users or Contributors in order to offer them any services or products.

In your use of the Website and/or Services you shall: comply with all applicable laws, regulations, directives and legislations which apply to your Use of the Website and/or Services in whatever country you are physically located including without limitation any and all consumer law, export control laws and regulations; provide to us true, correct and accurate information and promptly inform us in the event that any information that you have provided to us changes or becomes inaccurate; notify Mondaq immediately of any circumstances where you have reason to believe that any Intellectual Property Rights or any other rights of any third party may have been infringed; co-operate with reasonable security or other checks or requests for information made by Mondaq from time to time; and at all times be fully liable for the breach of any of these Terms by a third party using your login details to access the Website and/or Services

however, you shall not: do anything likely to impair, interfere with or damage or cause harm or distress to any persons, or the network; do anything that will infringe any Intellectual Property Rights or other rights of Mondaq or any third party; or use the Website, Services and/or Content otherwise than in accordance with these Terms; use any trade marks or service marks of Mondaq or the Contributors, or do anything which may be seen to take unfair advantage of the reputation and goodwill of Mondaq or the Contributors, or the Website, Services and/or Content.

Mondaq reserves the right, in its sole discretion, to take any action that it deems necessary and appropriate in the event it considers that there is a breach or threatened breach of the Terms.

Mondaq’s Rights and Obligations

Unless otherwise expressly set out to the contrary, nothing in these Terms shall serve to transfer from Mondaq to you, any Intellectual Property Rights owned by and/or licensed to Mondaq and all rights, title and interest in and to such Intellectual Property Rights will remain exclusively with Mondaq and/or its licensors.

Mondaq shall use its reasonable endeavours to make the Website and Services available to you at all times, but we cannot guarantee an uninterrupted and fault free service.

Mondaq reserves the right to make changes to the services and/or the Website or part thereof, from time to time, and we may add, remove, modify and/or vary any elements of features and functionalities of the Website or the services.

Mondaq also reserves the right from time to time to monitor your Use of the Website and/or services.


The Content is general information only. It is not intended to constitute legal advice or seek to be the complete and comprehensive statement of the law, nor is it intended to address your specific requirements or provide advice on which reliance should be placed. Mondaq and/or its Contributors and other suppliers make no representations about the suitability of the information contained in the Content for any purpose. All Content provided "as is" without warranty of any kind. Mondaq and/or its Contributors and other suppliers hereby exclude and disclaim all representations, warranties or guarantees with regard to the Content, including all implied warranties and conditions of merchantability, fitness for a particular purpose, title and non-infringement. To the maximum extent permitted by law, Mondaq expressly excludes all representations, warranties, obligations, and liabilities arising out of or in connection with all Content. In no event shall Mondaq and/or its respective suppliers be liable for any special, indirect or consequential damages or any damages whatsoever resulting from loss of use, data or profits, whether in an action of contract, negligence or other tortious action, arising out of or in connection with the use of the Content or performance of Mondaq’s Services.


Mondaq may alter or amend these Terms by amending them on the Website. By continuing to Use the Services and/or the Website after such amendment, you will be deemed to have accepted any amendment to these Terms.

These Terms shall be governed by and construed in accordance with the laws of England and Wales and you irrevocably submit to the exclusive jurisdiction of the courts of England and Wales to settle any dispute which may arise out of or in connection with these Terms. If you live outside the United Kingdom, English law shall apply only to the extent that English law shall not deprive you of any legal protection accorded in accordance with the law of the place where you are habitually resident ("Local Law"). In the event English law deprives you of any legal protection which is accorded to you under Local Law, then these terms shall be governed by Local Law and any dispute or claim arising out of or in connection with these Terms shall be subject to the non-exclusive jurisdiction of the courts where you are habitually resident.

You may print and keep a copy of these Terms, which form the entire agreement between you and Mondaq and supersede any other communications or advertising in respect of the Service and/or the Website.

No delay in exercising or non-exercise by you and/or Mondaq of any of its rights under or in connection with these Terms shall operate as a waiver or release of each of your or Mondaq’s right. Rather, any such waiver or release must be specifically granted in writing signed by the party granting it.

If any part of these Terms is held unenforceable, that part shall be enforced to the maximum extent permissible so as to give effect to the intent of the parties, and the Terms shall continue in full force and effect.

Mondaq shall not incur any liability to you on account of any loss or damage resulting from any delay or failure to perform all or any part of these Terms if such delay or failure is caused, in whole or in part, by events, occurrences, or causes beyond the control of Mondaq. Such events, occurrences or causes will include, without limitation, acts of God, strikes, lockouts, server and network failure, riots, acts of war, earthquakes, fire and explosions.

By clicking Register you state you have read and agree to our Terms and Conditions