One of SA’s largest beef cattle feedlots, Wanderribby at Meningie, is up for sale and expected to generate significant interest on the back of record beef prices.
Colliers International’s Jesse Manuel and Tim Altschwager have listed the 2700-hectare property, which includes an 8000-head licensed cattle feedlot and more than 2000 hectares of quality grazing land.
It has been run for the past 25 years by the Gunner family, who have developed a successful vertically-integrated business from the Stoney Point Angus stud to a wholesale meat operation Richard Gunner Fine Meats, which owns the Feast Fine Foods retail chain.
Wanderribby has been used by a number of customers, with cattle fed for a range of programs including European Union, Jap Ox and Certified Australian Angus Beef.
Mr Manuel said the Australian cattle property market had been the powerhouse of the national rural property market in 2016, including increased interest in feedlot investment.
“There is a significant trend towards higher slaughter rates in Australia to increase beef output and the only way the Australian industry is going to keep up with the demand is to put greater numbers of cattle through feedlots,” he said.
“This places a significant reliance on facilities like Wanderribby, which is well placed to benefit from this market trend.”
Since the feedlot and land was listed earlier this week, Mr Manuel said they had received enquiries from large producers, corporates, processors and “offshore interest”.
”One of the major features is its mild maritime climate with the feedlot being almost entirely surrounded by water with Lake Alexandrina, Lake Albert and the Coorong and catching any winds coming through in the morning or the afternoon,” he said.
“It has a very good catchment for cattle from the South East and western Vic and minimal competition for cattle compared to feedlots in the eastern states.
“With the excellent season, there will be a lot of grain on the market making it very affordable to feed cattle.”
Perry Gunner says the decision to offer the feedlot for sale is part of a “retirement process”.
“In recent years I have had a few health scares and have been looking at the things I am involved in,” he said.
“The feedlot stood out as a business to exit being in a contained parcel of land.”
Mr Gunner believes with high cattle prices and lower grain prices, it is a great time for feedlotters.
“There has never been a better relationship between the cost of gain and the price of cattle,” he said.
“Normally the cost of cattle in the paddock is below the cost of gain in the feedlot, but grain prices are down and cattle prices are strong and look like staying strong.
“This favourable relationship looks like being around for a while, so any buyer could fill it (the feedlot) up and get their money back quickly.”
Mr Gunner says Wanderribby feedlot’s unique strength is its moderate climate, being in close proximity to the Coorong.
“We only exceeded the heat load for one hour of one day last summer – no other feedlot in Australia could achieve that,” he said.
It is also centrally located to major cattle producing regions such as the SE, Fleurieu Peninsula and Kangaroo Island and has an outstanding track record of feeding cattle for a range of major clients throughout the years.
“Two independent sources have us in the top 5 per cent of the nation’s feedlot performance on weight gain and the quality of beef produced so for someone coming in they know they will get the results,” Mr Gunner said.
There are a range of options for potential buyers.
“There was some interest in developing a quarantine facility with the feedlot and it is within 200 kilometres of an export port (Outer Harbour) so the pens could be easily segmented for this.”
Australian Lot Feeders Association chief executive officer Polly Bennett says the number of cattle on feed nationally has increased by 15pc in the past five years.
“With demand continuing to grow for our quality grainfed beef internationally and domestically, we have seen increased investment in feedlots which is encouraging,” she said.
Expressions of interest close on November 3.