SALIC already has a stake in Australian agriculture with the 211,000ha Merredin Farms in WA. (Photo: Merredin Farms)
New overseas buyers of meatworks in WA aim to boost exports
by Chris McLennan
Two big global companies have made good on their promise to expand their agricultural operations in Australia.
Major Brazilian meatpacker Minerva Foods and part-owner Saudi Arabia's SALIC have bought two sheep-focused meat processors in Western Australia for almost $48 million with plans to expand their operations.
The pair have formed a joint venture "aimed at the possible acquisition of assets in Australia ... focused on breeding, farming, processing and exporting sheep and cattle in that country".
SALIC is the Saudi's state agricultural fund, and already owns 210,000ha Merredin Farms in WA.
Shark Lake and Great Eastern Abattoir have been the group's first buyup.
The export-licensed Shark Lake Food Group Abattoir is located at Monjingup near Esperance on WA's southern coast.
It is owned by the Central Agri Group owned by Melbourne-based businessman Rami Koyu which has operations in Victoria (Trafalgar) and the Northern Territory.
His group already sells Halal product into the Middle East.
The Great Eastern Abattoir is located at Tammin, about 200km east of Perth, and is also export licensed and trades to the Middle East, Africa and South East Asia among others.
The abattoir, owned by private company Westone Pty Ltd, exports frozen and chilled sheep, lamb and goats and is said to be Australia's largest meatworks of its kind.
The new owners say both plants will be operated in a joint venture with Minerva Foods holding 65pc and and SALIC 35pc.
The purchase deal includes the abattoirs and "investment to improve plants structure".
"When operating in full capacity, the plants are expected to reach a slaughter capacity of one million head per year," the new owners said.
In a notice to investors, majority owner Minerva said Australia was the world's leading exporter of sheep meat processed products.
It said Australia was globally recognised for its tradition and high-quality food products, accessing not only several high-growth markets, such as Asia and the Middle East, but also premium markets like the United States, Europe, Japan and South Korea, among others.
"In line with its strategic guideline and focus on food security, SALIC currently engages in sheep breading and fattening in Australia, allowing us to improve operational efficiency of the new assets," a Minerva statement read.
"Additionally, Minerva Foods, through its trading operation based in the region, with expertise in the sale of sheep and greater focus on the consumer markets of Asia and the Middle East, will substantially contribute to the commercial structure of the new operations."
The new owners said more than 150 new jobs would be created during the upgrade.
SALIC, fully owned by the Public Investment Fund, has already bought up about a third of Minerva Foods.
Minerva is the second-largest exporter in Brazil and produces more than one million tons of meat annually.
The 211,000ha Merredin Farms, located 300km east of Perth, includes a big cropping operation but also runs about 40,000 Merino sheep.
SALIC's aim is to shore up food security system in Saudi "by creating a series of sustainable agricultural investments in multiple geographic regions".
"The company believes Australia uniquely complements our operations in South America, maximising sales opportunities and operating synergies, reducing risks and contributing to our strategy of consolidation in the animal protein export market."
Minerva has said the joint venture is seeking to maximise new business opportunities, in order to meet the growing global demand for animal protein.
Saudi Arabia imports about 400,000 tonnes of red meat annually.