Goodfellow takes on China role

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CEO of Rifa Australia David Goodfellow.
The Land | 22 December 2014

Goodfellow takes on China role

by ANDREW MARSHALL

FORMER Elders boss turned Chinese agribusiness executive David Goodfellow is heading up a project to build an Australian livestock property portfolio of similar scale to Macquarie Bank's big Paraway Pastoral business.

The new chief executive officer of Rifa Australia departed his job as Elders' Australian group general manager in late May, a victim of the latest management shuffle within the farm service company after Mark Allison made the unusual move from board chairman to managing director.

Mr Goodfellow previously headed up Paraway Pastoral Company's expanding rural property portfolio until being appointed by former Elders managing director Malcolm Jackman in 2011, where he was widely tipped to be Mr Jackman's successor.

Rifa, which early this year bought well-known 2500-hectare Victorian Western Districts property "Blackwood" from the Ritchie family, has been buying Australian livestock genetics (live cattle, embryos and semen) since 2009 .

Chinese parent company, Zhejiang RIFA Holding Group, has sheep production interests in north-western China and an abattoir, but for the past three to four years has also been importing processed beef from Australia and elsewhere.

Rifa's increasing appetite for red meat, particularly beef, prompted it to buy land in Argentina last year, followed by its Victorian acquisition at Dunkeld, near Hamilton, with a view to more local expansion.

"I cannot disclose the total asset allocation Rifa has made to its plans for building a business in Australia, but I can say it is very significant," said Mr Goodfellow, who began his new job this month.

"It will be on a similar scale to what I built with Macquarie in Paraway."

Paraway, established just seven years ago, has 17 large-scale sheep and cattle stations across NSW, Queensland and the Northern Territory.


Beef focus
Mr Goodfellow said while the current focus was to invest in re-establishing livestock-related infrastructure and fencing on "Blackwood", Rifa had a long-term agenda to run a series of pastoral holdings over a range of geographic and rainfall zones.

The NSW Riverina, south-eastern South Australia and the high rainfall south west of Victoria were potential areas for more land acquisitions during a five-year period.

The property portfolio would be focused on beef production, principally Angus cattle.

However, Rifa had an "open mind" to investments in cropping and sheep and "in time, possibly other parts of the supply chain", if the opportunities appealed.

He agreed meat processing may be a feasible option for Rifa (or other similar Chinese agribusiness investors) given Australia's abattoir capacity was increasingly consolidating and aligned to a key group of meat industry players.

Chinese investment in agriculture offered the industry a much-needed chance to upgrade Australia's farming productivity and food supply chains not seen for 20 years or more.

"I'm quite excited about the genuine commitment to investment in agriculture's future and the fresh attitudes and capital China is bringing us," Mr Goodfellow said.

"Australia has generally not been increasing its capacity at the same rate as many countries have been developing their agricultural resources - from Africa to South America and the US.

"While others have made some massive investments to lift food production, we've tended to wait for the emerging markets to come to us and hope they pay more for what we produce.

"To some degree our agriculture sector complacency has been typified by the lack of government investment in research and regional infrastructure to commit to the industry's future."

Rifa's origins are in the textile machinery sector in Shandong and Zhejiang Provinces in eastern China, but its eight divisions also extend to investments in sports infrastructure, including an equestrian business.

Its Australian head office in Melbourne's up-market Toorak is establishing investment strategies and staff numbers to build its pastoral business to supply mostly beef to its fast-growing Chinese markets.

Trickle-down benefits of Chinese investment
A decade of lean earnings from many farms and farm service sector players - including Landmark and Elders - have steadily contributed to an urgent need for a Chinese cash injection in Australian agriculture, according to Mr Goodfellow.

Tighter local profits have meant less capital available to re-invest in future-building technology and initiatives to promote farm productivity.

Like the Japanese investors of the 1970s and '80s who drove rapid advancement in the beef feedlot and meat processing industries, the Chinese were enthusiastic, but also patient, about funding new farm production ideas today.

However, Mr Goodfellow said there were still plenty of opportunities for family farms and Australian companies like his former employer, Elders, to remain locally owned and make full use of the trickle-down benefits from new funds and technology in the sector.

In fact, as Rifa Australia's chief executive officer, he was "looking forward to building a solid, long-term relationship with Elders", as a client.

"Elders is very much part of the fabric of Australian agriculture," he said.

"It's an institution that's done a lot for rural Australia over a long period. It's golden egg. Its staff and shareholders deserve to see it prosper.

"I think we all hope it doesn't get sold, or dropped."
Original source: The Land
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