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Rural Industries Research & Development Corporation |
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Rural Industries Research & Development Corporation |
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Contact the editor, Dr Laurence Denholm, at: PO Box 1564, ORANGE NSW 2800 Phone/fax 02 6361 3268, Mobile 0418 641957 email: denholml@bigpond.com |
February 1999 Issue |
New venison marketing initatives considered
Special deer industry R & D committee meeting
RIRDC recently supported an extraordinary meeting of the Deer Industry Research and Development Committee in Melbourne to discuss possible R&D responses to the current downturn in export and domestic venison markets. DIRDC members and applicants for R&D funding in 1999/2000 met to discuss, evaluate and coordinate the R&D program in venison marketing.
considers new venison marketing initativesMr Peter Core, Managing Director of RIRDC and member of DIRDC, arranged for a consultant, Dr Bruce Standen, to attend the meeting to advise the committee on strategies to improve the deer industry’s understanding of export markets and improving the acceptance of Australian venison in those markets. Dr Standen was until recently the CEO of the Australian Meat and Livestock Corporation and has extensive experience in marketing Australian beef and lamb in Japan, Korea, SE Asia, the USA and Europe.
Following a report to the meeting from Mr Rudi Keller on the project he is managing to develop niche markets for venison in Europe (see below), a range of R&D strategies to improve venison demand and the reliability of markets was considered.
Mr Eric Loft from the Victorian Venison Co-operative indicated that there had been a decline in the domestic venison market, particularly in the food services sector, as a result of the falling off of local promotion and market development with the completion of Ms Lynelle Tume’s project in 1996.
However, Asian markets have now recovered to about 75% of the volume demand prior to the Asian financial crisis. Conversely, the European market is currently very tough, with prices down to $1.80/kg HCW (landed) as a result of very strong competition between NZ traders. Dr Standen related his experiences with marketing fresh lamb in the USA and several strategies that could be used to improve venison marketing. The meeting then reviewed the need for additional R&D in each current and potential venison market. Particular strategies were considered.
After the meeting, R&D applicants were asked to cooperate with each other and resubmit their applications, with significant modifications. New market development projects concentrating on the domestic and US markets are likely to be funded.
Understanding the role of the deer
The relationship between RIRDC, DIRDC and the DIAA
industry research and development committee
The Deer Industry Research and Development Committee (DIRDC) is established by the Rural Industries Research and Development Corporation (RIRDC) to advise RIRDC on the application of Commonwealth R&D funds for the deer industry. Members of DIRDC are appointed by RIRDC.Although DIRDC is a committee of RIRDC, not a committee of the deer industry itself per se, appointments by RIRDC to DIRDC have always been based upon DIAA recommendations.
The primary role of DIRDC lies in examining the documentation for projects involving deer or deer product R&D submitted to RIRDC with applications for funding support which are submitted to RIRDC for funding support and recommending to RIRDC whether each application should be supported or rejected. DIRDC has also commissioned some projects by asking particular organizations to submit proposals in particular high priority fields. DIRDC also has a more general role in the management of the Deer R&D Program. Assessment of R&D protocols is a specialized role. The DIRDC members have practical research backgrounds or experience of the R&D environment in a range of disciplines.
In managing the deer industry R&D program, DIRDC works very closely with the deer industry itself, particularly through the Deer Industry Association of Australia (DIAA) as the peak national industry body. Effectively, deer R&D priorities are set by the DIAA, in consultation with RIRDC. RIRDC considers and usually adopts DIAA recommendations on changes to R&D priorities.
Assessment of R&D applications by DIRDC
There are three distinct elements in the assessment of applications by DIRDC. Most project rejections now occur in the last two.The first involves an assessment of the objective/s of the project.
The work proposed must match RIRDC’s R&D role, as defined in the Primary Industries and Energy Research and Development Act 1989 (Cth). If it does, then the objectives of the proposed project are ranked as low, medium or high according to the R&D priorities set down by the deer industry itself in its 5 year R&D Strategic Plan (or as amended by subsequent recommendations from the industry.) In effect, unless a project application directly addresses a high priority defined in the industry’s R&D Strategic Plan, it is unlikely to be funded.
Next the environmental impact of the project is assessed, as negative, neutral or positive.
Then, and most importantly, the potential benefits of the likely outcomes of the particular project are identified and ranked as high, medium or low. This involves the identification of potential beneficiaries and whether or not they are supportive of the work proposed. An assessment of the magnitude of potential benefits from the project (economic, environmental and social) and benefits foregone if the work is not undertaken is then made. An assessment of the impact of the project on the advancement of knowledge is also made (important where projects may have no immediate direct economic outcomes but the knowledge gained will lead to other projects that will have economic outcomes).
Finally, an assessment is made of the likely extent and rate of adoption of the results of the project if the work is successful. Project proposals are expected to include some plans for technology transfer to industry.
The second element involves an assessment of the likelihood that the project will be successful in meeting its specified objectives. The project design and methodology and the capabilities of the research team are carefully assessed. Projects are expected to provide new knowledge or understanding. Authors of R&D proposals are expected to demonstrate an awareness of
The third element is assessment of the proposed budget. During the assessment process, budgets are often reduced by negotiation between DIRDC and the applicant organization. Individual items of expenditure must be necessary for the project and reasonable in the circumstances. Costs and charges must be reasonable for the work proposed, particularly salaries and labour. The overall cost and cost to RIRDC should be appropriate for expected benefits to industry from the project. The potential return on the industry’s investment in the project must be competitive against other project applications.
Deer R&D Program Funds
The Commonwealth provides funds to RIRDC for the Deer R&D Program from (1) compulsory levies imposed on deer producers under Acts of the Commonwealth Parliament and (2) contributions from general Commonwealth revenue. Interest on these funds held in the RIRDC Deer Industry Sub-Account also accrues to the fund.As compulsory industry levies are a form of taxation, expenditure of the funds provided by the Commonwealth to RIRDC for industry R&D is subject to the usual constraints on the application of public funds raised as taxes. In the case of the deer industry, the levy funds can only be applied for purposes for which they were collected - that is, the R&D program in the deer industry. Details of the ways in which the industry levy funds can be used by RIRDC are specified in law under Acts of Parliament. Ultimately, as a statutory authority, RIRDC is responsible to the government and the parliament for the proper application of industry funds, according to the relevant laws.
Through the “Terms of Reference” that RIRDC has set for DIRDC, the committee is also constrained within the same bounds. Although the Deer Industry R&D Sub-Account can be used for projects that involve market analysis, market development or trials of marketing procedures, the fund cannot be used for marketing per se. Commercial trading and product promotion are not permitted uses.
DIRDC Terms of Reference
1. To consult with relevant industry body/ies and participants, to evaluate their requirements for research and development, to prepare a R&D strategy plan for the industry and to annually review that plan for consideration by the [RIRDC] Board.2. To monitor, review and evaluate research support for the industry, to encourage R&D activity or applications for R&D support in areas of identified need, to consider applications for R&D support in accordance with the above plan and Corporation guidelines and to prepare an annual operating program for Board consideration.
3. To facilitate the dissemination, adoption and commercialization of the results of research within the industry.
4. Each year, to report to the [RIRDC]Board and the relevant industry body/ies on the activities of the Committee and the activities supported under the program.
Restrictions on DIRDC activityAgainst this background above, it is important that deer farmers and other industry participants understand the limitations on the role that DIRDC and RIRDC can play in some problems facing the industry. The RIRDC charter is limited to R&D, as defined in law. Hence DIRDC/RIRDC can address some of the problem faced by the industry, but not others. For example, DIRDC cannot directly intervene in infrastructural deficiencies or marketing inefficiency.
DIRDC/RIRDC is not in any meaningful way an equivalent to the NZ Game Industry Board. RIRDC does not have the statutory power to use industry funds for the type of marketing activities undertaken by the GIB. Legislation would be required to change this, but single-desk marketing of primary products is now seen as outdated.
However, this does not mean DIRDC or RIRDC are unsympathetic to the serious situation that deer farmers are now facing, nor does it mean DIRDC is unable to assist. It simply restricts the type of response that is possible.
But if a turnaround in the current situation requires a response from the industry that is outside the DIRDC charter, pressure from producers for an immediate response, literally any response, will not assist in the successful strategic investment of scarce industry funds by DIRDC. Nonetheless, as strategies emerge in which DIRDC can assist the industry, according to agreed R&D priorities, these will be implemented (for example, see page 6). LJD
The Deer Industry Company Report
Interest in the industry’s QA program continues to grow, with several people nominating to undertake training required to become QA facilitators. The DIC hopes to organise a training/upgrade day for all facilitators, in conjunction with this year's Biennial conference in Victoria. There are now 87 deer farmers and 11 deer transporters registered with the Deer Industry QA Board. Thirteen farmers have achieved Level 3 Accreditation and 6 have progressed to Level 2 (external assessment) Accreditation. One transporter has achieved Level 3 Accreditation.Farmers and deer transporters should be aware of EU requirements related to cleanliness of deer transporters that are used to move animals to be slaughtered to produce venison destined for the EU. Information on cleaning requirements and associated declarations required by AQIS to allow venison to be exported to the EU can be obtained from the QA Board.
The industry QA mark has been submitted for registration. We have been advised that the registration process may take up to 6 months.
Although not all processors have provided information for October and November 1998, we do know that more than 100 tonnes was processed. Available data indicates that average venison prices rose slightly from September to October (from an average of $2.39/kg to $2.44/kg HCW, less the levy, delivered to an abattoir) and remained stable during November. These data may need adjustment when information from all processors is available (data from several processors was unavailable at the time of writing this article).
Average quality of fallow carcasses available to venison processors for purchase appears to have improved slightly, with the percentage of carcases in the lower weight ranges decreasing. Average quality of red deer carcasses remained stable during October and November.
The Deer Industry Company has initiated the reproduction of venison promotional brochures as well as the development of some new industry promotion brochures. We hope that these will be available by May 1999.
FALLOW RUSA DEER RED Weight Category OCT
98NOV
98DEC
98JAN 99 Weight Category OCT
98NOV
98DEC
98JAN 99 Weight Category OCT
98NOV
98DEC 98 JAN 99 less than 20 $1.27 $1.51 less than 20 less than 30 20 to 22.9 $1.74 $1.93 20 to 24.9