THE nation's second largest meat processor - Teys Australia - wants more beef producers to become direct consignment suppliers for its burgeoning range of brands.
And it is promising to reward them by guaranteeing above commodity beef market returns.
Five years ago, Teys Brothers was a commodity trading business but, since the joint venture between the company and Cargill in 2011, it has transformed its business to partner with key customers in domestic and export markets.
Teys corporate service general manager Tom Maguire said the company was developing branded programs to meet each customer's specific needs, including animal welfare and environmental expectations.
At a Naracoorte Recognising and Responding to Market Signals producer day on Monday, Teys highlighted its large range of grass and grainfed brands: organic, European Union-accredited, Pasturefed Cattle Assurance System and Meat Standards Australia requirements.
The company is processing about 90 per cent to 95pc of its kill on a weight-and - grade basis.
About 150 SA and Vic producers were able to meet representatives of McDonalds Australia, one of Teys' key customers.
It also provided market information to assist producers with decision-making through a range of Teys and Meat & Livestock Australia speakers.
Mr Maguire said the company aimed to have a collaborative supply chain for 40pc of its production by 2016 - linking producers to global customers.
Australian processing costs for grainfed cattle were twice as expensive as the United States and grassfed stock cost double to process compared with Brazil, so it was necessary to get more for Australian produce by meeting customers' additional requirements.
"We need to target the right customer to add value and stabilise returns," Mr Maguire said.
"As the world (experiences a shortfall) of protein, more and more customers are realising they have to collaborate with us. What is at stake is their ability to get product and that is good news for the industry with demand expected to double in coming years.
"While cattle prices may not be where producers would like, we know some of these branded products are consistently better.
"We are committed to being able to grade every piece of beef for eating quality so the customer knows exactly what they can expect. We have got to do it because we are leaving value on the table."
There had been week-on-week growth in Teys' Grasslands brands - underpinned by PCAS domestically through Woolworths stores and export markets - particularly in the US.
This week, Teys paid $4.30 a kilogram for PCAS-accredited YP cattle, but from October it will pay 10 cents/kg premium on any PCAS animal, including cows and ungraded animals.
This had been driven by the strong demand for trim from the US.
* Full report in Stock Journal, August 21, 2014 issue.
Catherine Miller
Stock Journal's livestock editor and South East correspondent.
Stock Journal's livestock editor and South East correspondent.
