Australian Food & Farming is an Australian sheep meat producer that acquires, develops, owns and operates agricultural assets across productive regions of Australia.
AFF's aim is to be a lowest cost producer of sheep meat for Australian and international markets, while at the same time owning carefully selected land and water assets. This ensures a mix of stable revenues together with capital gains flowing from the underlying assets.
AFF currently owns and leases four farms in New South Wales and Western Australia, owns a leading Australian sheep stud which produces sheep ranked in the top ten percent of Australia, and also has a commercial herd of Dorper sheep. AFF properties are a mixture of dry land and irrigation and AFF has secured a reliable and cost effective water supply for its irrigated properties by owning rights to groundwater. This geographical diversity together with secure water rights considerably reduces AFF’s drought risk which is one of the key risks facing Australian agriculture and. It also stabilises production through the year.
AFF is focused almost exclusively on sheep meat, although cropping provides a secondary income stream. Australia and New Zealand are the two key sheep meat producers, producing 85% of the worlds exported sheep meat. This concentration of supply in just two countries means that the sheep market to some extent, follows a different dynamic to other red meat varieties. It means AFF is competing primarily against producers in developed countries. It also means the sheep meat market is less exposed to distortions from government subsidies that impact beef and pork markets. In addition, the scale of sheep meat production considerably trails beef and pork with the average Australian producer managing only 2,200 sheep. As a result, there is a prime opportunity for AFF to achieve economies of scale and establish a dominant position as one of the leading producers in the Australian sheep meat market.
AFF produces a breed of meat sheep known as Dorpers. Dorpers were originally a South African breed, that are ideally suited to Australian conditions. They do not require shearing and so have lower operational costs and importantly they produce 40 percent more lambs per year than other breeds of sheep. AFF’s Dorper sheep stud allows it to further genetically improve the key commercial Dorper traits of its flock, such as fertility and daily weight gain, thereby resulting in additional revenue gains.
The AFF Management Team draws upon a mix of agriculture, finance and legal experience and includes one of the earliest pioneers in the Australian Dorper industry. the Management Team have contributed over AUD $11 million of their own capital into AFF and their shareholdings are locked in for five years. Furthermore none of the directors are being paid or taking any fee for their work. As a result, they are personally committed to building AFF into one of Australia’s leading sheep meat producers. Management leads an efficient operational team which combined has almost 100 years of agriculture experience. This small and tight knit team is efficient, nimble and responsive and this has enabled AFF to secure opportunities that larger funds are unable to access.
AFF intends to expand by acquiring water rights and properties adjoining AFF land in New South Wales and also acquiring additional land in Western Australia. AFF also intends to expand its commercial herd to enable it to achieve scale to enable it to put in place tolling agreements with local abattoirs that will allow AFF to sell its sheep meat under brands that AFF has developed. This will ultimately allow consumers to purchase at competitive prices, natural free range sheep meat, free of hormones, antibiotics and other additives produced on AFF’s Australian properties.
