Paraway Pastoral has changed its focus from a large-scale grazing operation to becoming a reliable red meat supplier.
Stuart Johnston, general manager northern NSW, said at the Angus National Conference last week, vital measures for that change were securing the right properties, ongoing financing and the three Ps – people, partnerships and performance.
Paraway Pastoral was established in 2007 by Macquarie Pastoral Fund that allowed investors from around the world to invest in a red meat fund. It has grown to have 21 stations, more than 160 employees and a diverse portfolio of operations, with properties across three different rainfall zones – northern Australia, northern NSW and southern Australia – which collectively can carry 180,000 cattle and 200,000 sheep and some crop production.
Mr Johnston said they started with an eight-year fund that to finish July 2015, but key to Paraway’s development was the establishment of an open-ended fund, now valued at $7-800 million, in which investments were made on a longer-term basis.
“This time we have a focus on people who have a balance sheet (which allows) that they’re there for the longer term, we’re talking about a 20 year horizon,” he said. “The fund is now open-ended, which is pretty rare in agriculture, I don’t think there is another one, there are review dates but not an end date.”
This means that they’ve been able to buy and sell properties to support their goal of consistently supplying high quality livestock. Mr Johnston said the business also wanted to decrease its exposure to live export.
Last August, they also established separate offices in Orange NSW so the staff members are “100 per cent focused on Paraway” and not other Macquarie Pastoral operations. Macquarie Pastoral Funs is still the owner of Paraway Pastoral and it is a vehicle for investors to invest in the business.
Mr Johnston said in 2015, the northern beef arm produced 14 million kilograms of beef and southern beef, 4 million kg all of which are Angus (which also involved joining about 11,000 cows).
Paraway has three priorities: people, industry partnerships (including with feedlots and processors) and performance.
“People are number one, they are our most valuable asset,” Mr Johnston said, adding they were working to develop resources, training and other career pathways.
Paraway treats all the stations as individual businesses and Mr Johnston said he had to trust the managers were supported well enough to make the right decisions on farm.
He said in corporate agriculture balancing the efficiencies of scale without putting too much pressure on labour units and their attention to detail was very important.