Ballarat livestock-selling fee hike could force councils to follow

SALEYARD fees could come under scrutiny as Victoria’s new privately operated yards at Ballarat open next week with ramped-up selling costs for both producers and stock agents.

SALEYARD fees could come under scrutiny as Victoria’s new privately operated yards at Ballarat open next week with ramped-up selling costs for both producers and stock agents.

The cost to farmers selling a lamb or sheep that makes over $100 a head will jump from 67c at the current Ballarat site owned by the local council, to $1.24 a head when auctions switch to the new yards built by CVLX at Miners Rest next week.

The cost for farmers selling a weighed steer for $1200 will increase from $11.27 to $15.60. The rises have prompted fears the selling fees to be charged by CVLX could force council saleyards to increase costs.

FULL LIST: VENDOR AND AGENT FEES FOR MAJOR SALEYARDS

KELLY COUNTRY: FAIR SHARE ON YARD FEES

REACTION: SHOCK, BUT MOST TAKE RISES ON THE CHIN

Under National Competition Policy, government bodies are prohibited from undercutting private enterprise.

Ballarat is the biggest sheep and lamb selling centre in Victoria, with annual throughput of more than 1.3 million head, and is the first major sheep saleyard in southern Australia to come under the control of private enterprise.

It is also considered one of Victoria’s premier store cattle selling centres.

HAVE YOUR SAY: Are the new Ballarat yard fees reasonable? Comment below

The other major lamb and sheep selling saleyards in Victoria are council-owned and operated.

A Western District saleyard manager, who declined to be named, said they had been nervously awaiting the fee schedule for the new Ballarat yards.

“It is how we compare that is the potential problem due to the rules surrounding council-owned assets,’’ he said.

A precedent was set more than a decade ago when Victoria’s first investor-built cattle saleyard at Pakenham, ran by Victorian Livestock Exchange, successfully challenged the council-run Bairnsdale saleyards over its lower fees.

Ballarat stock agents have provided The Weekly Times with the proposed charges for the new Ballarat yards.

They reveal Ballarat would go from being among the cheapest saleyards in Victoria to the most expensive. Agents said they were disappointed by the dramatic fee rise.

“Agents are very frustrated with the fee structure — we’ve been in dialogue for the past two years and couldn’t get any change to price,’’ one Ballarat agent said.

“Basically it is their house and they make the rules and with the deal that was done with the City of Ballarat years ago we can’t get any leverage.’’

Agents claim they will wear the brunt of the increase in price, with the agents’ service fee to change from a flat fee of 14c per sheep and lamb sold and 50c for cattle, to 0.25 per cent of financial turnover.

For a lamb that sells for $150 this would nearly triple the charge to agents to 37.5c, while for a $1200 steer it would increase sixfold, to $3 a head.

Some Ballarat agencies, which have a big clientele that sell heavy lambs and grown steers, believe their total fee to sell at the new saleyards could balloon to $200,000 a year.

“It is a big, big increase for agents which will impact everyone’s business and bottom line,’’ one agent said.

Australian Livestock & Property Agents chief executive Andy Madigan said there was a cost associated with privatising saleyards that could challenge the industry in the form of fees and charges.

“Private ownership is going to push fees up. Yes, there are concerns about fees and where they are going and where they could end up now a lot of smaller yards are closing down but it’s something agents can’t do much about,’’ he said.

But agents have acknowledged the new Ballarat yards should offer labour efficiencies for agents, as well as improvements in animal welfare.

Xavier Bourke, president of the Ballarat Stock Agents Association, said the yards looked impressive and agents hoped they, as well as producers, would see benefits.

“We hope it is going to be a lot more efficient, but until we start working in those yards we are not sure what the improvements are going to be,’’ he said.

Wayne Osborne, managing director of VLE, which operates privately-owned saleyards in South Gippsland, said modern saleyards offered a higher level of service.

He said Ballarat’s soft flooring and undercover selling pens could prevent claims against other major competing saleyards, such as Bendigo and Horsham, which are older and without the same conditions.

“Council-owned business facilities have to achieve competitive neutrality — they can’t undercut the market of private enterprise providing the same service,’’ Mr Osborne said.

“But you have to be comparing like with like. The opportunity for us to challenge Bairnsdale came about when they installed a roof and soft flooring, and we were able to argue they were offering the same services as us but were undercutting on price.

“The ruling came down in our favour.’’

“I’m not sure the same situation applies to the new Ballarat facility compared to saleyards like Bendigo, as the level of service is not the same so they probably shouldn’t have to charge the same fees.’’

CVLX did not respond to The Weekly Times’ request for comments.