Although rewarding, exporting no easy feat for Meredith Dairy
WHEN it comes to export action and boosting rural business, Meredith Dairy is the big cheese in showing how it’s done.
WHY would you be bothered exporting when your business within Australia is growing at a phenomenal 10-25 per cent a year and has been for more than a decade?
For Julie and Sandy Cameron of specialty sheep and goat cheese and yoghurt enterprise Meredith Dairy, it’s commonsense really: to maintain that amazing growth rate.
They have worked tirelessly to achieve growth and don’t want to see it diluted. Exporting is their insurance policy and a hedge against the heavy debt carried in such a venture.
About 15-20 per cent of Meredith Dairy’s sheep and goat milk goods go to countries as diverse as the US, China, Japan, New Zealand, Vietnam and Malaysia.
Being realists, Sandy and Julie understand Australia’s comparatively small population means at some stage the domestic take-up of their high-end dairy products will steady.
For two decades Meredith Dairy has been using this export insurance policy, snaring new customers abroad, particularly in the US where its goat milk cheeses are keenly sought.
Yet, as Julie insists, exporting is definitely not for the faint-hearted or get-rich-quick brigade. And it’s not for every rural producer.
Getting started
When Julie, a nurse trained in microbiology, and Sandy, a vet, returned to the family beef, lamb and wool production farm, the sheep industry was in turmoil.
The reserve wool price had been abolished in 1991 and it was time to innovate or perish. The Camerons found their saviour in sheep and goat milk and cheesemaking, building their own on-farm dairy.
As their products won over Aussie foodies, exporting was the next step.
Looking back, Julie admits if they had known how hard it would be, especially in dairy, they might have hesitated.
As the company’s quality assurance manager, she attended numerous industry forums and recalls the consistent export advice she received was “don’t go there”.
Undeterred, they first worked through an export company that takes orders from overseas distributors and hotel chains but ran into problems because their dairy exports were classed as non-prescribed goods, not requiring an export number.
The non-dairy exports being shipped at the same time required export numbers, and it was feared the Camerons’ exports, through no fault of their own, could hold up entire shipments through red tape. So Julie and Sandy set out to obtain an export licence of their own, a six-month process involving regulatory requirements above those they had already met locally, such as implementing and documenting food safety plans.
“When you decide you want to export,” Julie says, “you need to pay a large fee to DAFF (the Department of Agriculture, Fisheries and Forestry, formerly the Australian Quarantine and Inspection Service) and they do a desk audit on your books and your food safety plan.
“Then, when you pass that, they come out and spend two days on your facility doing a full on-site audit. When you pass that you get an export control order number.”
The barriers
Exporting doesn’t come cheap, Julie warns, and the red tape is thick.
“Everybody thinks export is the bee’s knees but you have to expect to spend a lot of money on markets, travelling to those markets and investigating those markets.”
In their case, they first had to gain Australian Quarantine and Inspection Service licensing — “not cheap,” Julie says — and now they must undergo ongoing audits to maintain that licence.
Staff are needed overseas to represent and market products, and packaging must be changed to meet foreign labelling requirements.
“For example in America,” Julie says, “it’s still in ounces, not grams, and the nutritional panels have different requirements that need to conform to the US Food and Drug Administration.”
It’s also not unusual for facilities exporting into the US to be visited by American FDA auditors, as happened with Meredith Dairy with a two-day on-site audit six years ago.
You must be aware of overseas taxation laws, hold product liability insurance, especially in the US, insure staff on the ground overseas, and face up to the fact insurance companies are often loathe to provide cover if your company doesn’t have a proven track record over a lengthy period.
After meeting all these requirements, Julie says, you still must face the ongoing tyranny of distance.
“Australia is a long way from anywhere,” she says. “We went to a goat dairy conference in Norway and I heard people complaining how far they had to travel … and they were just coming from Sweden and France and Italy. They just don’t understand how far away we really are. So that’s hard.”
Excessive distance makes some products expensive to ship, and those with short shelf lives incur prohibitive airfreight charges.
Importance of awards
While winning industry awards might seem ego-tripping to some, Julie assures awards are hugely important, particularly when trying to crack the Chinese market.
“The Chinese put enormous emphasis on getting awards,” she says, “so we got quite proactive in entering achievers and international awards, as that’s the only way the Chinese can benchmark because they don’t always understand the products.
“So (with awards) they can say ‘Oh, this product won a gold medal at these awards’. That’s not the only reason we do it; we also do it to benchmark ourselves against our competitors here.”
Export aid
Julie stresses there is “fantastic” help to be gained from various agencies.
Meredith Dairy gained an export incentive grant from Austrade — “They will contribute 50 per cent of the cost of marketing material, tasting product and some travel costs,” Julie says — and support from Regional Development Victoria in establishing markets.
Likewise, support has come from the Department of Agriculture, Fisheries and Forestry and regulating body Dairy Food Safety Victoria.
Mixed blessing
While China, with its 1.3 billion-plus population, is a magnet to Australian exporters, it’s far from a straightforward market, Julie warns.
She is “a bit disheartened” after spending much time trying to get markets established there.
“We have done trade shows and tastings there, but we just don’t seem to be able to get over the line,” she says. “I find there’s a real trade barrier issue with our stuff going into China.”
Because of this difficulty, Meredith Dairy recently redirected many of its Chinese export resources to the easier-to-deal-with US market.
“They understand cheese and dairy,” she says, “and it’s not difficult to get stuff through customs”.
FARM FACTS — Meredith Dairy
Julie and Sandy Cameron operate Meredith Dairy on 1619 hectares, milking about 5000 dairy goats and 1100-1500 dairy sheep, with help from son Angus and Sandy’s father, Neil.
Products include fresh goat curd, marinated goat cheese, fresh goat cheese or chevre, and natural pot-set sheep and goat milk yoghurts.
The main export products are marinated goat cheese and chevre or fresh goat cheese.
They also grow grains and fodder and run prime lamb, operating on multiple sites.
The US is their biggest export market, followed by Japan and Malaysia.
Meredith Dairy deals directly with New Zealand, China and the US and uses an export company for other countries.
They employ nearly 100 staff, varying from dairy hands to truck drivers, in Australia and elsewhere.
Meredith Dairy’s policy is to produce strictly sustainable and innovative lines that don’t adversely affect the environment.
WATCH THE EXCHANGE RATE
At recent exchange rates, Julie confirms the Aussie dollar is good for Australian exporters such as Meredith Dairy but stresses in today’s uncertain world, rates can change dramatically, immediately affecting margins. “If the dollar lifts above 80 cents (US), for instance, it will be a case of break even,” she says.
JULIE’S BEST ADVICE
“Get your domestic operation working perfectly with good local markets and profits before you contemplate exports.“
GOT MILK?
Julie says since China’s counterfeit baby formula scandal she receives daily phone calls and email requests from people in China wanting to buy goat milk powder.
“They’re happy to buy goat milk powder, and there are something like 2000 registered businesses selling infant powder into China, but that’s not something we want to do. When they say they want dairy products, what they really want is milk powder.”
Seaweed offers new wave of feed
Dairy cattle on a seafood diet? A seaweed supplement is making a big difference to methane outputs in Tasmania.
Quality, not quantity the key to success
When it comes to award-winning crops, plant health is everything, as these Kyabram brothers can attest.