Saleyard giant RLX eyes western interests

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Peter MilneCountryman
The future of Boyanup’s saleyards is under review.
Camera IconThe future of Boyanup’s saleyards is under review. Credit: Danella Bevis

Australia’s largest saleyard group, RLX, which is looking to replace the Boyanup saleyard, take over Muchea Livestock Centre and offer the livestock industry new services, makes apparently contrary claims about how competition affects its charges.

The State Government has offered any company willing to replace the Boyanup saleyard the option to also take a long-term lease over the State-owned MLC.

RLX, the biggest private owner and operator of saleyards in Australia, is interested in coming west where all large saleyards are now State or council-owned.

RLX saleyards are managed by the AAM Investment Group and owned by private investors such as superannuation funds through Palisade Investment Partners.

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AAMIG managing director Garry Edwards said his company’s operations needed economies of scale and it would only build a South West saleyard to replace Boyanup’s yards if it could also lease the Muchea facility.

Mr Edwards said he had visited MLC many times and had identified changes RLX would make.

“It’s really around the weighing and drafting process but also how we deal with the sale operations and the interactions with agents,” he said. Mr Edwards said RLX could offer additional services not yet available in WA saleyards, such as pre-feeding and health checks for feedlots.

“We’ll undertake weaning programs on behalf of our clients, often they don’t have the facilities or the time,” he said.

If RLX added MLC and the replacement to the Boyanup facility to its existing portfolio of seven saleyards, it would control 65 per cent of the cattle and 44 per cent of the sheep put through major WA saleyards, according to 2017 data from Meat and Livestock Australia.

Mr Edwards said he was always asked the same questions from people concerned about the cost of using a privately operated saleyard.

“We’re in a competitive market of alternate selling methodologies, alternate buying platforms,” he said.

“Our business is not about ramping up fees, it is about increasing volume and expanding services.”

The message on Palisade’s website to potential investors is that one of the saleyards “investment fundamentals” is that “key revenue drivers” are “quasi-monopolistic”.

Mr Edward said the RLX and Palisade perspectives on competition was not a case of two conflicting messages to two different audiences.

“No, not at all. What they are talking about is explaining the infrastructure definition of how revenues are occurring at a single geographic location,” he said.

Palisade aims to expand its seven saleyard network to 10 to 15 saleyards and it has identified future sites worth about $185 million, according to its website.

A new $31 million RLX saleyard is currently nearing completion outside Ballarat, in Victoria, to replace the council-owned saleyard in the town.

One livestock agent said the fees proposed for the new saleyard were triple what he currently paid.

Mr Edwards said the charges to livestock agents at the old saleyard had been discounted due to its poor condition and the new charges were the same as RLX imposed across its network. He said any RLX saleyard in WA would be open to all livestock agents and would not require government assistance.

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