Avalon Airport: Victoria's Live Animal Freight Centre - a business case
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DRAFT – 27 June 2014 Avalon Airport: Victoria’s Live Animal Freight Centre - a business case
Table of Contents: 1 EXECUTIVE SUMMARY ................................................................................................................. 2 2 INTRODUCING AVALON AIRPORT ........................................................................................... 4 3 WHY AIR FREIGHT LIVE ANIMALS FROM AVALON?........................................................... 6 4 AVALON LIVE FREIGHT’S REGULATORY CREDENTIALS .................................................... 8 Policy, partners and stakeholders ........................................................................................................................................... 9 5 THE CURRENT SYSTEM .............................................................................................................. 10 6 LIVE EXPORT OVERVIEW .......................................................................................................... 11 The Victorian Picture ...................................................................................................................................................................11 Cattle ..................................................................................................................................................................................................12 Horses.................................................................................................................................................................................................16 Sheep ..................................................................................................................................................................................................17 Goats ...................................................................................................................................................................................................18 7 EMPLOYMENT AS A RESULT OF LIVE EXPORT .................................................................... 19 Avalon’s Current Economic and Social Significance ......................................................................................................19 8 ECONOMIC IMPACT OF LIVE FREIGHT ................................................................................. 20 Contribution to gross domestic product .............................................................................................................................20 9 REGULATION................................................................................................................................. 22 Requirements..................................................................................................................................................................................22 Process for becoming a Registered Premises. .................................................................................................................23 Process for becoming an Approved Premises ..................................................................................................................23 Australian animal health and welfare controls ...............................................................................................................24 International requirements ......................................................................................................................................................24 Operations and infrastructure - logistics ...........................................................................................................................25 Standard for air transport of livestock ................................................................................................................................26 Procedure for live exporter ......................................................................................................................................................26 10 KEY RISKS FOR EXPORTER .................................................................................................... 27 11 KEY CHALLENGES FOR EXPORTER ..................................................................................... 27 12 NEXT STEPS ................................................................................................................................ 27 13 APPENDICES ............................................................................................................................... 28 Appendix A: Australian Standards for the Export of Livestock ................................................................................28 Appendix B – DAFF Breeder Livestock Export Data ......................................................................................................29 14 RECOMMENDATIONS ............................................................................................................... 34
DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
1 Executive summary
Avalon Airport is operated by Avalon Airport Australia Pty Ltd (AAA), a wholly owned subsidiary of Fox Group
Holdings Pty Ltd. AAA is a commercial aviation aerodrome situated on 1,753 hectares, 40 minutes west of
Melbourne’s Central Business District and 20 minutes east of Geelong.
Avalon Airport’s geographic location beside the three lane freeway that links Melbourne and Geelong makes it
both a capital city airport and an exceptionally well-equipped regional airport, servicing a large regional catchment
in western Victoria.
Avalon Airport has land available for the development of uses that complement its core aviation focus. Among
these uses, the airport has suitable accessible space within which to develop animal handling, quarantining
and loading facilities.
This report advocates for Avalon becoming Victoria’s primary live animal airfreight hub. It recognises that,
although slower, with the attendant animal welfare considerations arising from prolonged travel, sea transport is
more cost efficient for freighting larger numbers of live animals for slaughter. However airfreighted animals are
more valuable. (In 2012, while breeders only made up about 19 % of the total number of cattle exported, the
value of these animals was 42% of the total value of cattle exported that year.)
Airfreight provides for a shorter transit time ensuring health and welfare and allows for smaller numbers than
slaughter animals by sea. Importing countries provide higher subsidy incentives to offset the higher costs of
airfreight.
Thus Avalon’s focus is on the more specialised sectors of animal handling, quarantine and transporting
high value breeding animals and charter flights of valuable racehorses. (Live animal airfreighting is generally
used for valuable breeding animals, pregnant animals, bulls/rams; sheep, goats and horses.)
Quarantining of live animals before export is required. Horses are quarantined at the Werribee Equine Centre
and cattle on a farming property in Romsey, some 60 kms north of Melbourne.
Developing an onsite quarantine facility at Avalon will reduce road transportation distances and times. Avalon
Live Airfreight can become a “one stop shop”, reducing stress on valuable animals and reducing freight costs and
times.
If quarantine facilities are developed at Avalon, it need not be just for Avalon: the airport could also offer
quarantine facilities for animals due to be exported by ship from Portand. The adjacent Melbourne Water facility
(some 7,000 acres) presents opportunities for a partnership that sees animals being agisted on Melbourne Water
land prior to export transferred directly to quarantine facility at Avalon, before transport to Portland for sea freight
overseas.
Establishing quarantine and live animal airfreight facilities at Avalon would provide direct road access via
the main freeway network and eliminate travel between quarantine and export sites (reducing feed and
water withholding times and stress to animals). There would also be minimal likelihood of delays due to
scheduling issues.
Avalon Airport currently handles significantly less aircraft movements than it did in previous decades, when
substantial use of the airport for military, training, general aviation and other purposes occurred.
Because Avalon has a proud history as an important service centre for the aviation industry, it has well-
developed facilities and the potential for delivering even greater economic benefit to the region.
The development of live animal freighting at Avalon is important not only as a viable industry in its own right, but
also as a key step in ensuring the airport remains active and available to realise its further potential as
other opportunities arise.
2
DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
With the continued growth of the Wyndham Shire, Geelong and the Surf Coast it is vital that a viable regional
airport facility remains active and able to provide jobs in areas where unemployment rates are higher than
the statewide figure.
Avalon Airport is currently an Australian Quarantine and Inspection Service (AQIS) approved premises for Class
1.2 with accredited personnel . It currently meets the criteria for Classification A air cargo terminal and air
freight depot operations.
The airport has a secure quarantine building and meets, or will be able to meet, the applicable standards
for live export .
AQIS sees no problem in airport gaining status of approved premises (approval per shipment).
Avalon has the support of partners and stakeholders.
Although only a small section of the national live export market, airfreight of valuable beef and dairy cattle has
shown strong growth in volumes. Most animals are going to Asia.
As examples only, one exporter is reported to have consigned 2,515 head of cattle to Kazakhstan in 2012-13. A
second sent some 900 cows to China in 2013 and a third some 1200 head to Russia in 2013.
In Victoria live animals are shipped through the busy Tullamarine Airport. This can involve long travelling and
waiting times, especially in metropolitan traffic or if timetabling issues at the busy Tullamarine Airport delay
scheduled flights.
Extrapolated figures suggest that Avalon Airport currently provides in the order of 164 direct FTE jobs. The
multiplier effect shows Avalon supports a further total of about 590 FTE jobs in indirect employment.
Any potential to increase employment impact is important in a regional context. Corio (which takes in the
western fringe of the Greater Geelong area) had an unemployment rate of 6.1%, compared with State average
unemployment rate of 5.4%. Some parts of the region experienced higher unemployment levels, eg Corio SLA
(7.5%) and Werribee (7.3%). The Shire of Wyndham figure in 2011 was 6.3%.
The live sheep and cattle export industry contributed the following to the national economy over the five years
from 2000-2004:
$1.80 billion to gross domestic product;
12,924 jobs; and
wages and salaries totalling $0.99 billion.
3
DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
2 Introducing Avalon Airport
Avalon Airport is operated by Avalon Airport Australia Pty Ltd (AAA), a wholly owned subsidiary of Fox Group
Holdings Pty Ltd. AAA is a commercial aviation aerodrome situated on 1,753 hectares, 40 minutes west of
Melbourne’s Central Business District and 20 minutes east of Geelong.
Avalon Airport’s geographic location beside the six lane freeway that links Melbourne and Geelong makes it both a
capital city airport and an exceptionally well-equipped regional airport, servicing a large regional catchment in
western Victoria and providing connections to significant tourism destinations such as the Great Ocean Road.
Since Linfox Group’s purchase of the airport in 1997 (through a 50 year lease agreement, with an option to extend
for a further 49 years), Avalon Airport’s aviation operations have grown significantly as it has established itself as a
second gateway to the Melbourne and Geelong regions. Today, the airport contains land and facilities that are
surplus to current and projected aviation requirements. This provides the opportunity to pursue property
development projects for a wider range of activities, which supports Avalon Airport’s growth as an airport and as a
major employment centre for the region.
AAA has established a vision for Avalon Airport: “to be a World Class Centre of Aviation Excellence”, achieved via
four pillars of activities: passenger operations, technical aviation operations, freight operations and retail and
commercial developments.
All four pillars are enabled by AAA’s focus on providing the appropriate infrastructure, resources and by garnering
strong community support. Each pillar reinforces the others as they provide key inputs and resources to each other
by operating together on a single site: the value of the whole is therefore greater than the sum of the individual
parts.
4
DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
1.1 Regional Context
Melbourne is the largest city in Victoria and the second largest city in Australia. Some experts predict that
Melbourne will overtake Sydney to become Australia’s largest city by 2028.
Werribee is the location of significant recent urban growth. Formerly a rural service centre, Werribee and other
townships in the City of Wyndham became the focus of significant residential growth beginning in the 1970s and
1980s, serving as an affordable housing alternative for families wishing to settle in Melbourne. The south western
portion of the municipality is dominated by the Melbourne Water Western Treatment Plant and rural development,
while the eastern portion has seen significant development of industry (warehousing, manufacturing, etc.).
By June 2013, Wyndham’s population is estimated to be over 187,000 and is forecasted to grow by an annual rate
of 4% to reach over 245,000 by 2021. According to the City of Wyndham, Wyndham has experienced the largest
and fastest growth in all Victorian local government areas and is the third fastest growing in Australia.
Geelong is a major urban locality in south east Australia with an estimated population of over 220,000 back in
2010. It is a significant industrial centre with a traditional manufacturing and port based economy. The city has
experienced serious effects of market adjustment and industry restructuring but, in April 2012, the unemployment
rate for the Barwon Region was 5.0%.
The Victorian unemployment rate at the same time was 5.5% and the Australian unemployment rate was 4.9%.
The Barwon Region, incorporating the City of Geelong, and the Surf Coast, Queenscliffe, Golden Plains and Colac
Shires, had an estimated population of over 290,000 people in 2010.
The City of Greater Geelong has a program of economic development aimed at diversifying the economic base and
encouraging development of a range of new economic drivers. However, the economy is still vulnerable to market
and policy driven sectoral changes affecting major employers in town.
Avalon Airport is located about 10 minutes drive from the Corio Norlane area. This area is a source of great
potential employment. The unemployment rate in this region is significantly higher than other parts of Geelong.
About 50% of young people in Corio and Norlane are receiving Centrelink benefits. According to the ‘Northern
Futures’ website, the 3214 region has the highest incidence of diabetes in the region, more than 10% above the
national average. Therefore, the development of Avalon Airport presents an opportunity to both the airport in
terms of employees, and the area in terms of employment and improved wellbeing.
1.2 Forecasts
As a secondary airport in its civil operations infancy, Avalon Airport is highly susceptible to even minor fluctuations
in market conditions. Locally, the temporary grounding of Tiger Airways in 2011 brought a significant reduction in
the number of passengers and aircraft movements at the airport. On a global scale, ongoing economic uncertainty
continues to influence airline fleet planning, acquisition and route expansion activities – all of which having the
potential to impact the further development of Avalon Airport.
In spite of this, significant growth in Melbourne air traffic movement is forecast in the coming 20 years. The
Bureau of Infrastructure, Transport and Regional Economics (BITRE) predicts that passenger activity through
Melbourne will grow by 3.9 per cent annually over the next 20 years, with international and domestic traffic
anticipated to grow by an average annual rate of 5.5 per cent and 3.4 per cent respectively.
5
DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
3 Why air freight live animals from Avalon?
This report advocates for Avalon becoming Victoria’s primary live animal air freight hub. Live animal airfreighting is
generally used for valuable breeding animals, pregnant animals, bulls/rams; sheep, goats and horses.
Airfreight provides for a shorter transit time ensuring health and welfare and allows for smaller numbers than slaughter
animals by sea. Importing countries provide more subsidy incentives to offset the higher costs of airfreight. For example
China offers a $US2,000 per head subsidy on airfreighted breeding dairy cattle.
This report recognises that, although slower, with the attendant animal welfare considerations arising from prolonged
travel, sea transport is more cost efficient for freighting larger numbers of live animals for slaughter. Thus Avalon’s focus
is on the more specialised sectors of transporting high value breeding animals and charter flights of valuable racehorses.
Superbly located on major rail and road transport routes, between the Victorian capital and its main regional centre,
Avalon Airport has some 1,753 hectares of land ripe for the development of uses that complement its core aviation focus.
The airport has suitable accessible space within which to develop animal handling facilities. Developing an onsite
quarantine facility at Avalon will reduce road transportation distances and times. Avalon Live Airfreight can become a
“one stop shop”, reducing stress on valuable animals and reducing freight costs and times.
Cattle bluetongue virus is among the diseases covered by the strict protocol imposed by the Chinese Government to
govern cattle imports. Victoria is the major source of breeding cattle, especially Holstein dairy cattle, from the bluetongue
virus free area of Australia. When considering distance from farm gate to quarantine or export centre, Victoria is best
placed to supply this trade – either from the western district or the irrigation areas of northern Victoria.
Centralised quarantine facilities at Avalon would be well positioned to handle export cattle bound for export either from
Avalon itself, from Portland, or via Tullamarine. Travel and handling times (and hence stress to valuable animals) would
be minimised by using such a facility. The adjacent Melbourne Water facility (some 7,000 acres) presents opportunities
for a partnership that sees animals being agisted on Melbourne Water land prior to export transferred directly to
quarantine facility at Avalon, before transport to Portland for sea freight overseas.
Holding and quarantine facilities at Avalon would provide greater flexibility without compromising animal welfare. Being
able to hold sufficient cattle numbers at an integrated facility at Avalon to cover animals rejected for export would save
the exporter money and time in meeting quotas.
Why breeding animals?
There is an increasing demand amongst emerging economies to increase their self-sufficiency in meat and dairy. To do
this they are looking to build up their herds.
Welfare concerns about the live export of slaughter animals mean that importing countries need to build up breeding
cattle before possible future bans on live export. Airfreight provides a mechanism by which these emerging countries can
increase their breeding herd by importing high value breeds to cater for new rich eg Wagyu cattle, Suffolk sheep.
The International Air Transport Association (IATA) is the trade association for the world’s airlines, representing some 240
airlines or 84% of total air traffic. The IATA says animals have been transported by air since the early 1930's. In today's
modern world, carriage of live animals by air is considered the most humane and expedient method of transportation
over long distances.
Avalon Airport currently handles significantly less aircraft movements than it did in previous decades, when substantial
use of the airport for military, training, general aviation and other purposes occurred. Because Avalon has a proud
history as an important service centre for the aviation industry, it has well-developed facilities and the potential for
delivering even greater economic benefit to the region.
The development of live animal freighting at Avalon is important not only as a viable industry in its own right, but also as
a key step in ensuring the airport remains active and available to realise its further potential as other opportunities arise.
With the continued growth of the Wyndham Shire, Geelong and the Surf Coast it is vital that a viable regional airport
facility remains available and active.
6
DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
Avalon’s on site capacity
Aerial view of Avalon.
potential livestock handling and quarantine site
Avalon Airport has a site to the south east of the runway that is suitable for developing an animal handling facility.
The site has direct road access off Pousties Rd, which runs along the airport’s eastern boundary.
About 4 Ha will be set aside for the installation of holding yards, loading facilities, drive over scales, facilities for
AQIS, customs etc and staff facilities (including staff showers). Existing internal roads would be used to transport
loaded animals the short distance from the handling facilities directly into waiting airplanes.
The holding and handling area can easily be double fenced as part of the measures needed to meet quarantine
requirements.
As well as quarantining animals being moved through the airport itself, Avalon could offer quarantining facilities for
sea shipments (ex-Portland) with holding yards to accommodate these animals.
Horses can be loaded from Avalon’s new quarantine area or from the existing equine quarantine facility in nearby
Werribee.
Avalon can offer a 24:7 service to live animal freight needs. Each flight will be supported by at least seven
dedicated, accredited staff for four hours (ie .74 EFT) per flight. In the short term live animal freight movements
will potentially lift staff numbers by two or three: longer term up to seven extra jobs will be created.
7
DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
Avalon’s existing runways and associated facilities are capable of handling airplanes currently used for live animal
freighting without any adverse impact on payloads. Flights include at least one stop in transit – be that Darwin,
Singapore, or Kuala Lumpur – and runway lengths are sufficient to accommodate these flights without
compromising payloads to such destinations.
Avalon offers:
Proximity
Space
Quarantine isolation
Short transit times
24:7 curfew free service
Dedicated, accredited staff
Purpose built animal handling facilities
4 Avalon Live Freight’s regulatory credentials
Avalon Airport is currently an Australian Quarantine and Inspection Service (AQIS) approved premises for Class 1.2
with accredited personnel (approval number V0733).
The premises currently meets the criteria for Classification A air cargo terminal and air freight depot operations.
Avalon currently has a secure quarantine building including:
Inspection and storage areas
Fumigation
Live animal holding areas (not currently suitable for live export requirements)
Wash Bays
Dunnage and waste disposal
Office and record retention
Avalon meets, or will be able to meet, the applicable standards for live export (Standard 2, 3 & 6 - Australian
Standards for the Export of Livestock 2011) relating to trucking, quarantine and loading of live animals.
AQIS has stated that the facilities for loading are adequate and there would be no problem in gaining status of
approved premises (approval per shipment).
8
DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
Policy, partners and stakeholders
Government policy supports the continued development of freight handling facilities at Avalon Airport.
The Victorian Government’s Food to Asia Action Plan (March 2014): “recognises the potential of Victoria’s aviation
infrastructure in growing food exports to markets in Asia, and is working with operators of Melbourne and Avalon
Airports – as well as key regional airports – to ensure that adequate airfreight capacity is maintained into the
future. The Government’s efforts are focused on keeping Melbourne and Avalon Airports curfew-free, maintaining
efficient road access to these airports for exporting firms and supporting the development of major new freight
precincts and handling facilities at both airports.”
This position confirms The Victorian Government’s aims, as contained in Victoria the Freight State – the Victorian
freight and logistics plan (August 2013). This document: “outlines the Victorian Government’s long term strategy
to improve freight efficiency, grow productivity and better connect Victorian businesses with their markets,
whether local, national or international.”
This plan includes among its key directions the maintenance and development of airfreight capacity. (Direction 4 –
Ensuring adequate airfreight capacity). This recognises Avalon’s role as a “strategically located” hub with the
potential to grow Victoria’s role as a gateway for international trade and cargo, in particular, new markets in Asia.
In addition to government policy backing, Avalon has the support of the following partners and stakeholders for its
bid to secure the market:
(Include exporters, farmers, freight forwarders, airlines and political connections – PKD to supply.)
9DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
5 The current system
Live animal airfreight in Victoria currently moves through Melbourne’s busy
international airport, Tullamarine.
While figures for the number live animals moving through Tullamarine are
difficult to obtain, indicative volumes suggest a significant trade.
According to the Tullamarine website: “Melbourne Airport handles 350,000
tonnes of air freight per annum, giving it more than 30 per cent of Australia's
freight market. Cargo terminal operators at Melbourne Airport include Qantas,
Menzies, Toll Dnata, DHL, and the Australia Post Gateway facility.
“In addition to over 3000 weekly flights that service Melbourne, there are currently 21 dedicated freight services
arriving and departing from Melbourne each week. The international freight airlines currently servicing Melbourne
are Malaysia Airlines, Cathay Pacific, Qantas and Singapore Airlines.”
According to DAFF reports, between 30 November 2013 and 31 January 2014 480 cattle were exported by air from
Tullamarine.
One exporter is reported to have consigned 2,515 head of cattle to Kazakhstan in 2012-13. A second sent some
900 cows to China in 2013 and a third some 1200 head to Russia in 2013.
The live trade uses two main methods: the first where smaller numbers of live animals are shipped as part of a
mixed cargo aboard regular scheduled aircraft; and the second is where whole loads of animals are freighted on
chartered airplanes that contain no passengers or other cargo.
Quarantining of live animals is required before or after freighting. Horses are quarantined at the Werribee Equine
Centre and cattle on a farming property in Romsey, some 60 kms north of Melbourne.
(In June this year the Victorian Premier announced the establishment of an international quarantine centre at
Werribee Racecourse.)
Animals are generally transported to and from the airport and quarantine centres by road. This can involve long
travelling and waiting times, especially in metropolitan traffic or if timetabling issues at the busy Tullamarine
Airport delay scheduled flights. For example, cattle currently agisted on Melbourne Water land next to Avalon
Airport are trucked to Portland for quarantine, then back to Tullamarine for export.
A consignment of 321 breeding heifers to Tullamarine last year that experienced no transport or scheduling hold
ups spent one hour being trucked from quarantine to the airport and a further four hours being loaded. Typically
this is then followed by flight/transit times of a further 12 – 20 hours.
Establishing quarantine and live animal airfreight facilities at Avalon would provide direct road access via the main
freeway network and eliminate travel between quarantine and export sites (reducing feed and water withholding
times and stress to animals). There would also be minimal likelihood of delays due to scheduling issues.
(PKD to provide further detail of current Tullamarine operation for inclusion)
10DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
6 Live export overview
The Victorian Picture
Number of live beef and dairy cattle, sheep and goats exported
Port 2009 2010 2011 2012 2013
Portland 674,734 470,231 539,443 195,828 288,474
Melbourne 20,887 21,860 19,522 3,319 8,372
Geelong 13,217 9,563 4,347
Total 695,621 492,091 572,182 208,710 301,193
Breakdown by category
Description 2009 2010 2011 2012 2013
Live sheep, for other than
breeding purposes 642,346 404,325 473,035
Live sheep 126,497 198,172
Live pure-bred breeding
dairy cattle 51,264 64,483
Pure-bred dairy breeding
cattle 29,970 38,405 41,429
Live dairy cattle (excl.
pure-bred breeding cattle) 12,331 22,670 14,176 10,096
Live pure-bred breeding
beef cattle 20,319 37,894
Live beef cattle (excl.
pure-bred breeding cattle) 1,719 13,676 16,976 513
Live goats 7,226 11,802 13,990 21 644
Pure-bred beef breeding
cattle 373 1,205 11,817
Live sheep for breeding
purposes 1,656 8 759
Total 695,621 492,091 572,182 208,710 301,193
Value (FOB)
Description 2009 2010 2011 2012 2013
Live sheep, for other than
breeding purposes $53,015,220 $43,261,430 $67,053,236
Live sheep $17,757,593 $17,358,937
Live pure-bred breeding
dairy cattle $124,889,053 $138,041,042
Pure-bred dairy breeding
cattle $69,577,465 $76,341,306 $91,468,675
Live dairy cattle (excl.
pure-bred breeding cattle) $24,821,890 $48,008,445 $30,495,317 $14,858,512
Live pure-bred breeding
beef cattle $38,093,498 $62,688,678
Live beef cattle (excl.
pure-bred breeding cattle) $3,239,661 $18,056,581 $15,039,528 $302,627
Live goats $965,828 $1,426,302 $901,230 $20,000 $129,750
Pure-bred beef breeding
cattle $851,150 $1,309,562 $28,632,057
Live sheep for breeding
purposes $513,643 $35,500 $283,483
Total $152,984,857 $188,439,126 $233,873,526 $195,921,283 $218,218,407
11DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
(source DAFF)
Cattle
Australia is the world leader in the export of beef and dairy cattle, sheep and goats to many countries around the
world. In 2012 Australia exported a total of about 2.95 million livestock with a free on board (FOB) value of A$891
million.
In 2012 only 1% of the total live cattle exported were shipped via charter planes. This amounted to 8,144 head
(about 38 plane loads) of predominately dairy breeding cattle, with some beef breeding cattle.
Slaughter and feeder cattle are traditionally shipped via sea freight. There was a decline of 17% in the quantity of
slaughter and feed cattle shipped in 2012.
Dairy breeding cattle increased by 4% and beef breeding cattle by 110%
Australian live cattle exports totaled 617,301 head in 2012 (down 11% on 2011), valued at A$605.7 million FOB.
Indonesia remained the largest market for Australian cattle in 2012, taking 278,581 head, down 33% on 2011 –
valued at A$188.8 million FOB. Indonesia accounted for 45% of total Australian live cattle exports in 2012.
China was the second largest market for Australian cattle in 2012 (up 5% on 2011), taking 56,026 head, valued at
A$123 million FOB.
Darwin was the largest live export port in 2012, shipping 237,828 head, valued at A$159.4 million FOB. Fremantle
(102,931 head) was the second largest port in 2012, followed by Broome (88,286 head).
12DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
Total dairy cattle exports increased by 4% in 2012, to 77,092 head, valued at A$176.9 million FOB. The largest
dairy cattle market for the year was China, taking 52,406 dairy cattle, down 1% on the previous year and valued
at A$116 million FOB.
Live Cattle Export share by market
Cattle bound for Indonesia are mostly for
Other slaughter.
13% Indonesia
60%
The 6% sent to China are all high value
breeding animals
China
6%
Japan
4%
Middle East
6%
Malaysia
7% Phillipines
4%
13DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
(While the number of breeding cattle exported is far smaller than those sent for slaughter, their relative value is far
higher. For example, in 2012, while breeders only made up about 19 % of the total number of cattle exported, the
value of these animals was 42% of the total value of cattle exported that year.)
14DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
Live cattle future forecasts
Record Australian beef exports are forecast to continue in 2013, the combined result of high slaughter levels due
to drought conditions, sustained growth in emerging markets and the recent devaluing of the Australian dollar.
Tough production conditions across the north will continue, while in southern Australia good seasonal conditions
going into spring should have a positive impact on the market
Beef exports for 2013 are forecast to set a new record at over one million tonnes, with recent Australian dollar
depreciation and emerging market growth increasing demand but leading to declines in volumes to Japan and the
US.
Australia has been able to capitalise on current market access advantages in China and the Middle East, with
China's demand spurred by a growing economy, tightening of import regulations, limited access for US and
Brazilian beef, and increased consumer demand for imported product.
Beef exports to Japan are forecast to total 290,000 tonnes swt for 2013, the lowest annual level since 2003, and
exports to Korea are anticipated to be steady for 2013 however volumes will come under pressure into 2014 as the
US tariff reduces further.
Live cattle exports are forecast to be 575,000 head in 2013, with any further growth heavily dependent on
discussions for improved partnerships between Australia and Indonesia. Australia has boosted its projection for live
cattle exports by 25%, after key market Indonesia abandoned a quota system.
Dairy - the Victorian Situation
15DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
Horses
Air transport of horses utilises either a “jet-stall” system in
which horses travel in a fully enclosed air stable or an open
stall system in which there is a lesser degree of enclosure.
The open stall system usually is utilised when the entire
aeroplane (in a freighter type configuration), or a
considerable section of it, has been chartered by shipping
agency.
The numbers of horses that are carried in open stall
systems is determined by the type or aeroplane in which
they are carried and the size of the horses to be
transported.
Three horses can be accommodated across the width of a
narrow-bodied aeroplane e.g. Boeing 707 or Douglas DC 8, in triple stalls. This number can be extended to four
horses provided they are relatively narrow in conformation, in “quad” stalls.
Wide-bodied jets e.g. Boeing 747 or Douglas
DC 10 can accommodate up to seven horses
across their width.
Jet stalls can carry up to three horses and
have a groom entry door and a groom’s
compartment at the front of the stall.
Jet stalls are used where aircraft are
chartered from airlines but they can also be
used in so-called “Combi” systems, where
passengers are carried at the front of the
aeroplane and freight, including the horses in
the jet stalls, is carried in the rear.
Passengers are separated from the freight
section by a partition.
The normal practice of the horse air transport
industry is that the ratio of personnel to animals should usually be one groom for every three horses on the
aeroplane.
Seating restrictions may limit the number of grooms that can be carried. Horses are offered hay ad lib while the
aeroplane is at flight and water is provided every six to eight hours or at landing/refuelling stops.
Quarantine horses
There is no quarantine required for horse(s) that are exported from Australia to New Zealand.
Prior to departures all horse(s) require tests for:
Equine Infectious Anaemia (EIA) within 21 days of export
Entire horses that are aged 12 months and over also require to be tested for
Equine Viral Arteritis (EVA) within 21 days of export
The horse(s) have been treated with an approved long-acting broad spectrum parasiticide effective against
ticks and a broad spectrum anthelminthic within 48 hours of export.
Pregnant mares are not allowed to travel after 300 days into the pregnancy.
16DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
Sheep
Australian live sheep exports totaled 2,279,622 head in 2012, valued at A$277 million FOB.
Total exports for the year were back 7% on 2011.
The Middle East took over 99% of Australian sheep exports for the year.
Kuwait remained the largest market for Australian sheep in 2012, taking 706,644 head,
down 26% on 2011 – valued at A$78.9 million FOB.
Western Australia was again the largest export state for sheep, shipping 1,766,379 head, valued at A$215
million FOB. South Australia (376,623 head) was the second largest export state in 2012, followed by
Victoria (127,510 head).
17DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
Goats
Australian live goat exports totaled 61,880 head in 2012 (down 2% on 2011), valued at A$9 million FOB.
The largest market for the year was Malaysia, which took 59,107 head, up 9% on the previous year.
Malaysia accounted for 96% of total exports for the year.
New South Wales was the largest export state for live goats in 2012, exporting 37,266 head, valued at
A$6.9 million FOB.
In 2012, 99% or 61,245 goats were exported by airfreight.
18DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
7 Employment as a result of live export
Avalon’s Current Economic and Social Significance
In July 2010, AAA commissioned an Economic Impact Assessment (EIA) to better measure Avalon Airport’s
contribution to the local and State economies. The following paragraphs extrapolate from the key findings of this
EIA to reflect the withdrawal of Qantas Maintenance from Avalon in 2013.
Direct Employment
Avalon Airport provides direct employment for 253 workers across a range of employment categories. The
composition of the workforce is detailed in the table below, which also provides information on total and Full-Time
Equivalent (FTE) employees.
CATEGORY PERSONS EMPLOYED AVERAGE LOADING DIRECT FTEs
Airline Staff 85 0.8 68
Airport Operations 95 0.6 57
Retail 26 0.4 10
Other 47 0.8 38
TOTAL 253 0.65 164
Extrapolated from study by Essential Economics, 2010
These figures suggest that Avalon Airport supports in the order of 164 direct FTE jobs. The direct employment
opportunities provided by Avalon Airport are significant when considered within the context of its surrounding
municipalities. Data from the 2011 Census indicates that Commonwealth Electoral Division of Corio (which takes in
the western fringe of the Greater Geelong area) had an unemployment rate of 6.1%, compared with State average
unemployment rate of 5.4%. More importantly, some parts of the region were seen to be experiencing higher
unemployment levels, such as the Statistical Local Area of Corio (7.5%) and Werribee (7.3%). The Shire of
Wyndham figure in 2011 was 6.3%.
When considered within this context, Avalon Airport is an important employment centre for the Barwon South West
region.
Indirect Employment
Using multipliers derived from an analysis of ABS input-output tables, national accounts data and standard industry
classifications (ANZSIC 1993), it is estimated that total indirect employment supported by Avalon Airport is in the
order of 590 FTE jobs as shown below:
CATEGORY DIRECT FTEs MULTIPLIER INDIRECT FTEs
Airline Staff 68 4.1 210
Airport Operations 57 3.1 120
Retail 10 1.9 10
Other 38 3.0 75
TOTAL 164 3.6 590
Extrapolated from study by Essential Economics, 2010
While the above figures are approximations only, they highlight the current impact that Avalon Airport has from an
employment perspective on state and local economies.
19DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
Australian International Airshow
The Australian International Airshow is held at Avalon Airport every two years. Nine Airshows have been held to
date with an agreement in place with the State Government for Avalon Airport to continue hosting the event until
2025. A National Institute of Economic and Industry Research (NIEIR) impact statement for the 2011 Avalon
International Airshow identified gross benefits to Victoria’s economy of $151.6 million and the creation of 1,700 full
year equivalent jobs. Additionally, the associated Defence and Aerospace Exposition is a key generator of economic
and trade activity, with over 500 organisations from 23 countries participating in 2011.
8 Economic impact of live freight
Contribution to gross domestic product
The live export industry has flow-on impacts to regional and national economies. The livestock export industry
value chain is complex and relatively long. Up to 30 separate business types, each generating additional value and
employing people in both urban and regional Australia have been identified.
The businesses that are involved in the industry are often specific to the live export industry, or generate the vast
majority of their revenues from live export activity. It is often the foundation of a business which supplies other
requirements in remote areas.
The impact of the sheep, beef cattle, dairy cattle and goat live export industry on the national economy is by the
National Institute of Economic and Industry Research (NIEIR)
Based on NIEIR analysis, the live sheep and cattle export industry contributed the following to the national
economy over the five years from 2000-2004:
$1.80 billion to gross domestic product;
12,924 jobs; and
wages and salaries totalling $0.99 billion.
This employment number is based on general equilibrium modelling, which estimates the effect of expenditure
along the value chain on other sectors of the economy.
A general equilibrium model was used to determine the impact of the live sheep and cattle export sector on the national
economy. General equilibrium modelling incorporates all sectors of the Australian economy, within one dynamic framework.
The NIEIR general equilibrium model was calibrated with data sourced from both published sources and the case study
interviews. The model is a multi-sector model, based on the 107 industry input-output table for the national economy. Each
industry has equations for investment, employment, output, prices, costs, and imports. There are also equations explaining
policy variables such as exchange rates and interest rates.
For this evaluation the model was used in multiplier type three mode. That is, with inter-industry, consumption, investment
responses and surplus economic capacity. This enabled the national impacts to be determined as the sum of the regional
impacts. The impacts are based on the industry since the last evaluation in 1999. Average annual live export numbers for the
five years between 2000 and 2004 were used in the analysis. Using data from a wide period was considered the most robust
basis for the estimation of impacts given the variability in year to year levels of exports.
20DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
The dairy cattle value chain
The value chain of the live dairy cattle export industry has been established from discussions with industry
participants. The market differs from feeder/slaughter cattle and sheep, as there is a lower volume and the
demand has a higher level of volatility.
The value chain, based on market conditions in 2004/05, is provided in Table 18.
* Note: highly variable depending on market. Certification, quarantine and veterinary costs vary with protocols
and the estimates here are at the lower end of the scale.
The main benefit of the live export of dairy cattle for domestic producers is a higher value market for surplus
stock. If a typical dairy operation retains 25% of heifers for replacements, then the 15% surplus of heifers is
available for sale to the export market. The export market can take these dairy cattle earlier, and at a premium,
over the domestic market. Industry experts have indicated that the price on the domestic market is about $600 per
head, a significant discount to the typical price for export of $1,000 to $1,300 per head.
This premium has a positive impact on producer income and cash flow. Dairy cattle export markets have provided
an important alternative source of income for dairy producers in recent years, during a period of drought and
deregulation. When domestic milk prices are low, the sale of surplus stock provides cash flow for dairy farmers.
The high value of dairy cattle in export markets has led to some producers shifting their focus to produce dairy
cattle specifically for the export market (Landline 2005).
21DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
9 Regulation
The live animal exporter must comply with the Australian animal health and welfare system, including all Australian
Government and state, territory or local government laws that apply to the health and welfare of livestock in a
particular jurisdiction.
The exporter is also responsible for ensuring that importing country requirements are met and that verification
systems are established to meet audit scrutiny throughout the livestock export chain.
Where the exporter subcontracts to service providers, the exporter is responsible for instructing the service
provider to comply with the Standards and importing country requirements, and to ensure that all of the above
requirements are met.
In particular, the exporter must source suitable livestock that meet consignment specifications, such as species,
class, condition, animal health and welfare status and number of livestock.
The exporter must also ensure sufficient livestock services are maintained throughout the voyage and on-board
care and management of the livestock is adequate to maintain animal health and welfare.
To achieve this, the Standards prescribe that the exporter must engage an accredited stockperson and, when
required, an accredited veterinarian (see also Sections 6.4 and 6.5).
The exporter is also responsible for ensuring that livestock are loaded in a manner that prevents injury and
minimises stress by providing competent animal handlers and suitable loading facilities.
In addition, the exporter must ensure that stocking densities meet all relevant requirements and that there is
adequate provisioning of the vessel before departure, including feed, water and veterinary supplies.
The exporter must be able to demonstrate that the preparation and loading of livestock at the port of embarkation
have been conducted in accordance with the approved loading plan, and any importing country requirements, and
in compliance with the Standards and any requirements of the relevant state, territory and local governments.
Requirements
Registered Premises / Approved Premises
Registered Premises - a holding area that has been registered with AQIS for animals to be exported by both sea
and air.
Approved Premises - a holding area that has been approved for a single shipment by air only by AQIS.
22DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
Process for becoming a Registered Premises.
Application to AQIS, which must be accompanied by:
An accurate map or plan clearly showing the location, boundaries and topography of the premises in
relation to adjoining property.
Detailed plans and specifications of the premises showing fences, water and feed troughs, shelters,
drainage, food and water storage, isolation areas and entry and access points.
A copy of an operations manual in accordance with section 2.05 of the Export Control (Animals) Order
2004.
Evidence that the applicant has control of the day-to-day operation of the premises and has any approval
or licence necessary to operate the premises from the responsible State and Territory authority.
The proposed species, and class or classes, of live-stock that the applicant proposes to prepare at the
premises.
The greatest number of live-stock that the applicant proposes to hold and assemble at the premise at the
one time (and, if the live-stock will not all be of the same species, the greatest number of each species).
The months of operation which the premises are proposed to be used to hold and assemble live-stock for
export.
Meteorological evidence regarding the weather in the area of the premises during the months of operation.
Evidence showing that there is adequate shelter on the premises for livestock during the months of
operation.
Process for becoming an Approved Premises
Exporter names premises on their application to export.
AQIS inspects premises and approves for single shipment.
Live Export Process Logistics
To minimise the chance of an adverse animal health and welfare outcome during the live export process, a whole-
of-chain risk-based approach must be adopted. This is to ensure that critical risks are identified, their potential
impacts analysed, and risk management measures developed and implemented.
For each consignment, Australian Government legislation requires the livestock exporter to undertake adequate
planning encompassing a thorough risk assessment and development of appropriate risk mitigation measures. The
planning must cover the sourcing, land transportation, treatments and inspections before export, and specific plans
to manage the animals’ health and welfare during the journey from Australia to the importing country, whether by
air or by sea.
For the export of livestock by sea, the mechanism to achieve this is the submission by the exporter to AQIS of a
notice of intention (NOI) to export, and a consignment and risk management plan (CRMP). The Approved Export
Program (AEP), which details any particular treatments or inspections deemed necessary by AQIS that must be
carried out by an accredited veterinarian, is then provided by AQIS to the livestock exporter. Exporters are
required to prepare the animals in accordance with the approved CRMP, the AEP and the Standards.
23DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
Australian animal health and welfare controls
All livestock for export must meet the Australian animal health and welfare system, which consists of Australian
Government legislation, including the Standards, the codes, state and territory legislation, and animal health and
welfare policies.
In accordance with this system:
Livestock entering the live export chain must be raised under conditions that are consistent with good
animal husbandry practices.
There must be processes in place to allow livestock in every consignment to be identified and traced if
necessary and to ensure that any disease, abnormality, condition or treatment of livestock that could
adversely affect fitness for export is identified and acted on.
Livestock management practices, farms of origin, and registered premises and equipment must be
operated and maintained to ensure the health and welfare of livestock in the live export chain.
International requirements
The importing country determines animal health and any other requirements for imported livestock, and
may advise the Australian Government of these from time to time.
Although the livestock exporter is responsible under Australian Government legislation for compliance with
these requirements, any negotiation on the requirements is undertaken at a government-to government
level.
AQIS provides a health certificate and an export permit when it is satisfied that the livestock for export
meet the requirements of the importing country.
The OIE establishes international animal health guidelines, and has recently developed animal welfare
guiding principles that are relevant to the export of livestock.
The Standards developed in Australia take into account OIE animal welfare guidelines and in most
instances exceed these.
24DRAFT Avalon Airport: Victoria’s Live Animal Airfreight Centre
Operations and infrastructure - logistics
Air transport of livestock
Division 1 Preliminary
6.1 Guiding principles
Animals are prepared according to required protocols, are fit to travel, and the journey is planned and
undertaken in a manner that meets the importing country requirements for the air transport of livestock.
6.2 Required outcomes
(1) Livestock sourced for export must meet any requirement under a law of a state or territory
relating to the sourcing of livestock. State and territory governments are responsible for ensuring
that these requirements are met.
(2) Livestock sourced for export must meet these Standards and importing country
requirements. AQIS is responsible for ensuring that these Standards and requirements are met.
(3) Livestock are safely delivered to an airport of the importing country.
(4) Statutory reporting requirements are met after the flight.
(5) Livestock sourced for export that become sick or injured during on farm preparation must
be excluded from export, and arrangements must be made for their prompt and humane handling
and care.
6.3 Overview
(1) Air transportation of livestock for export encompasses the sourcing of livestock and their
on farm preparation, through to the air transportation phase of the export chain.
(2) Transportation by air, whether on long international journeys or shorter domestic flights,
requires careful planning to reduce any adverse impacts on animals. The entire export journey
from the property of source to the final destination (either the airport or the receiving country’s
quarantine facility) should be planned.
(3) The airlines have a responsibility to deliver animals to their destination in such a way as to
minimise any adverse effects on them.
(4) The airline and the exporter are responsible for the care and welfare of all animals during
transport, even when an attendant appointed by the exporter travels with the consignment.
(5) Animals must be transported in aircraft holds that can be adequately ventilated, and in
which the temperature can be maintained at a level that is comfortable for the animals. Airport
ground power units to operate air conditioning systems may be required for certain aircraft.
Aircraft carrying livestock should be loaded and unloaded as quickly and safely as possible.
(6) International Air Transport Association regulations were considered in the development of
the Australian Standards for the Export of Livestock
(7) These Standards are relevant to each stage of the livestock export chain and should be
reflected in relevant quality assurance programs. Livestock sourced for export must meet any
requirement under a law of a state or territory. State and territory governments are responsible for
ensuring that these jurisdictional requirements are met under respective state and territory
legislation. AQIS must be satisfied that importing country requirements and the Standards have
been met before issuing a health certificate and export permit.
Note. Further details regarding roles and responsibilities and the export chain process are
outlined in the Australian Position Statement on the Export of Livestock
(www.daff.gov.au/livestockexportstandards).
6.4 Linkages to other parts of the export chain
(1) In the planning phase, the exporter must specify the livestock to be exported in the CRMP.
(2) Where livestock for export by air transportation are transported by road to the registered
premises and are prepared in registered premises, the Standards for those parts of the export
chain apply.
6.5 Definitions
Approved premises - is a place approved by AQIS for the pre-export preparation of livestock by air.
AQIS - means the Australian Quarantine and Inspection Service.
CRMP - means a consignment risk management plan.
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