Intensive Livestock - Poultry

Chicken is Australia’s most consumed meat, and per capita consumption has grown to 49 kilograms per annum. The volume of chicken produced by the industry has increased at about 3% per annum on average over recent years. Growing demand for chicken meat has been supported by its cheaper price in comparison with other meats, aided by dramatic improvements in production efficiencies, as well as the perceived health benefits of lean white meat. Poultry farming had a revenue of $582 million in 2020-21 and poultry processing had revenue of $8.1 billion. Victoria ranks second in terms of poultry farming, with 28% of grower farms, but a distant third in processing establishments with 20% of the national total (after New South Wales, 32%, and South Australia, 28%).

The chicken meat, or broiler, industry is experiencing rapidly expanding demand for ‘all natural’, free range and organic chicken products. The adoption of free range systems imposes new operational and environmental challenges for the industry in terms of biosecurity, production efficiencies, bird genetics (for free range performance) and nutrient management.

Poultry meat farm locations are influenced by both the location, and the contractual relationship with a processor. Processors prefer farms to be within 100 kilometres of the plant, but the rising importance of biosecurity, experienced farm managers, free range environments means that distances of 2 to 3 hours by road can now be negotiable. Other locational factors include feed supplies, water supply, electric power and access to transport and labour. The early development of commercial poultry meat production in Australia occurred at the metropolitan-rural fringe (in regions like Mornington Peninsula in Victoria and the Hills and Macarthur districts of New South Wales), but urban development pressure, biosecurity concerns and the scale of modern commercial operations is restructuring the geographic distribution of the industry. This is an issue for further development opportunities in G21 region.

The broiler industry has been characterised by restructuring in the twenty-first century; large-scale mergers and acquisitions which have driven productivity levels higher and allowed leaders in the industry to take advantage of economies of scale. Two of the processing industry’s largest players, Baiada Poultry and Inghams Enterprises, account for just over 50% of industry revenue. Much of the growth achieved by these enterprises has been through merger and acquisition activity. In 2009, Baiada acquired most of the operations of Bartter Holdings. An ACCC decision prevented Baiada acquiring all of Bartter’s operations, and the facilities in Geelong (previously known as Bartter/Steggles) were acquired by La’Ionica (subsequently acquired by Turi Foods) and the Geelong plant produces under the brand “Golden Farms”.

Global players have also entered the industry, with the 2013 acquisition of Inghams Enterprises by United States based TPG Capital, and the entry of international genetic stock supplier Aviagen Ltd.

Baiada recently closed its processing plant in Melbourne, leaving Turi Foods as the largest processor in Victoria. Hazeldene’s Chicken Food is the second largest Victorian processor. Turi Foods and Hazeldene’s are large ‘second tier’ poultry processors.

The poultry meat industry remains protected, due to strict quarantine restrictions preventing importation, to limit exposure to disease. Elite genetic birds are imported and quarantined before re-location to breeder farms.