Lean Meats shareholders get bonus payment
Lean Meats has announced a bonus payment to its farmer-supplier shareholders above the meat schedule after a stronger company performance.
The meat company, majority-owned by farmers with a head office in Hastings, today announced a return to its Atkins Ranch Producer Group (ARPG) of shareholding suppliers an average of 31 cents a kilogram, or $5.74 a lamb.
Payment was split, with an average of $1.85 a head delivered six weeks after processing and the remaining $3.89 to be received in the last working week of this month.
Lean Meats chief executive Richard Thorp said the financial lift was from farmers supplying lambs at a market-reflected procurement price and through the company being able to sell more packed items from a carcass and gaining export status to China this year through its Oamaru plant.
"We're pleased to be in a position to provide a return to our loyal shareholder farmer suppliers," he said.
"The sector has seen difficult times and everyone in the supply chain has worked hard to get into a better position.
"Our approach hasn't changed over the last 25 years. We have encouraged our farmers to be part of the value chain, and they have stuck by us, and this year we can now reward ARPG members with a return above schedule."
He said there had been a market correction at the farm gate, but supplier returns had improved from the previous year, and export certification to China had opened up a market opportunity to cater for a growing demand for lamb cuts.
"We remain very confident that we can continue to perform at similar levels, based on increased demand from China and sales of lamb primals into the United Kingdom, Europe and North America," he said.
"Our strategic direction for doing business with China is based on keeping it simple, building strong customer relationships and not attempting to be everything to everyone."
Thorp said the company had strengthened its sales and marketing focus with several key appointments.
Last year it appointed Alister King as marketing manager and backed this with Chris Balaam, in London, named as its British and European sales and marketing representative.
Lean Meats farmer supplier James Rogers, of Koeke Estate near Taihape, said the bonus above the meat schedule was a timely windfall after recent tough times.
"It's been a tough time for farmers throughout the North Island and around Taihape," he said.
"Due to the drought, we supplied lambs a bit lighter than we would have liked, but we're thrilled to be getting a return above schedule."
He said farmers wanted Lean Meats to become the sheep-meat industry equivalent of the Tatua dairy co-operative and deliver superior returns to farmers.
To become an ARPG member, farmers are required to buy 2000 shares. They receive a payment of 90 per cent six weeks after slaughter and the remaining 10 per cent three months after slaughter.