WAMMCO profits soar

Australia's biggest lamb and mutton co-operative is going from strength to strength after almost doubling the record profit it returned last year.

WA Meat Marketing Co-operative Ltd made $19.6 million in 2013-14 as it continued a stunning turnaround from a loss of $885,000 in 2012-13.

WAMMCO chief executive Coll MacRury said that in addition to a pool bonus of $3.6 million to about 1400 producers in WA, it would use the profit to invest $11 million to upgrade chiller and freezer facilities at its Katanning plant. Another $4 million will be spent on production upgrades at the abattoir in Goulburn.

The capital expenditure plans were revealed at yesterday's general meeting in Perth where Yealering sheep and grain producer Kelly Manton-Pearce was announced as the winner of a four-way contest for a seat on the WAMMCO board.

Dr Manton-Pearce, a meat scientist and leading figure in WA agriculture, becomes the first female member of the board.

WAMMCO increased turnover across its two abattoirs from $210 million to a record $270 million in 2013-14.

Mr MacRury said it was reinvesting profits to keep up with market demand.

"We need to keep developing assets in both Goulburn and Katanning to keep up with the more complex processing that needs to take place to service premium chilled lamb markets," he said.

"In Katanning, we need to upgrade our freezer and chiller operations to ensure premium chilled lamb arrives in the markets in optimum condition. We are needing 80 to 90-day shelf life and to get that you have to have top quality technology."

North America regained its position as WAMMCO's biggest market by value and volume in 2013-14.

"We have seen steadily improving economic conditions in North America," Mr MacRury said. "The improved position of the Australian dollar versus the US dollar combined with the rising cost of other protein in that market has seen lamb come into its own."

WAMMCO's strength in the US and Canadian markets is helped by its status as the only Australian member of a marketing co-operative also made up of three big processors in New Zealand.

Mr MacRury said the investment in North America, where WAMMCO is a supplier to Costco, was driving strong demand for heavyweight lambs.

He said Chinese customers continued to put a floor in the market with lower-value cuts more than doubling in price over the past few years.

WAMMCO, WA's biggest lamb exporter and the second biggest in Australia, employs about 350 people at Katanning.