 So good afternoon. As Alex mentioned, my name is Andrew Spencer. I'm the CEO of Australian Pork Limited. I'm going to talk to you about investing in pork industry growth in Australia. It's not the type of investment you might be expecting, but for our industry it's been a very important and valuable investment in change. It's been a journey and it continues to be a journey a bit like the winding Australian road you see here. There's always dangers of going off on the corners. We're slowly finding our way, but we're very aware of those dangers as they persist. I want to start by looking back when I presented a couple of years ago at Outlook. The pork industry was under attack. Our pig farms were being raided in the dead of night and campaigns were being run around the evils of so-called factory farming. Illegally obtained videos were confronting our farmers across the country and they were placing our industry at the centre of a battle between perception and reality. Some of this is still happening today and it's even still happening in recent days. At that time our industry was rapidly changing and it still is rapidly changing. We had to change to meet these challenges and change is one of the only things that we expect to be constant into the future. Challenges are not something foreign to the Australian pork industry where one of the few agricultural sectors that competes in our own market with imports and the amount of imported pork coming into this country today means that about 45 percent of all of the pork that we consume comes from pigs produced on the other side of the world. Retailers, they're in a never-ending pursuit of differentiation and the imposition of production conditions through private standards placing demands for change on our producers is now standard practice. Consumers, consumers want to eat meat in the main but they don't want to know too much about how it got onto their plate. They do want to be secure in the knowledge that good and responsible people did the right thing in getting that meat there and it's my industry's responsibility as well as other people in this room to do exactly that. Activists largely motivated through a vegan philosophy don't want any exploitation of animals and they challenge the very existence of our industry. So all of this adds up to a hell of a lot of interest in in what we do and that's at many different levels. Ultimately whether an individual consumes pork or not they still want to know that we look after our animals that we care for the environment basically that we do the right thing along the way and we need to be able to take the lead and tell our story about how that happens and not leave a vacuum for others to fill and for the Australian pork industry this is a work in progress. Our history of intense competition through being truly exposed to global markets has built an attitude within the Australian pork industry that we have no God-given right to exist and we understand to recognise this and it reflects itself in many of the activities that the industry gets involved in and additionally we're acutely aware of course that the future strength and profitability of our industry depends on meeting these challenges. So the way that we're trying to do that is through constant change and adaptation and this can be expressed under three distinct categories people pigs and pork and I'll talk about them briefly. Firstly people in particular pig farmers our organisation has worked very hard at and been able to develop open honest and frank relationships with our pig farmers and to their great credit our producers have made big decisions and invested personal and financial capital in adapting to change and they're going to need to continue to do that. So how have pig farmers changed? Over the last 10 years we've moved from growing pigs to producing food in the form of pork and there's only a subtle difference in the words but they hide a major attitudinal shift with significant consequences on Australian pig farms. It's a fact of life that we in Australia are never going to be the world's lowest cost pork producer so our pork has to be worth the premium it attracts and our product integrity system is one way that we're able to achieve this. The system includes three components namely APIC our quality assurance system, pig pass and fizzy trace. APIC is our quality assurance system with modules covering the mandatory food safety verification but also best management practice, biosecurity, animal welfare, environmental impact. It's a very robust system it stands up really well against other agricultural sectors it has annual independent audits and over 90% of the pork produced in Australia comes from properties that are certified under APIC. Pig pass is our pork version of the national livestock identification system. It tracks pig movements noting where they've come from where they're going when that happened and how many pigs are in in that consignment. Scaled that information up to the totality of the Australian pork industry pig pass provides us with an enormous base of information to manage an emergency disease outbreak which is its primary objective but it also gives us a compelling understanding of how pig trading works right down to the producer by producer or the processor by processor level. Fizzy Trace is our product traceback tool. If you were to go shopping at Woolworths buy a pork cutlet take the packaging off give me a piece of the meat I can send that to a lab and in 24 hours I will tell you which Australian pig farm that it came from. So it's a technology that we discovered here it was introduced for the pork industry with support from Australian pork limited and it is totally unique to the Australian pork industry some other agricultural sectors are now picking it up it's trace elemental based profiling and it's extremely accurate it's been used in courts of law. So combine these three technologies and our industry has enormous capability particularly around verification of product claims for example around production systems such as free range or south store free or the provenance of products country of origin or data come from a particular area from a particular pig farm. So the point I'm trying to make Australia's pork producers have evolved over the last years not away from their farms but definitely towards a better understanding and meeting the needs of the consumer. And we see our ability to be able to continue to do this as a core competence that we try and achieve more quickly than other protein industries and the international pork exporters that we compete with here. Secondly pigs what's changed for our pigs in 2010 our producers decided to invest something around 50 million dollars in making changes on their farms to take away the south stalls those small tight individual pens for sows and put the sows into what we call loose housing and thus Australian pigs now lead the world in how their house thanks to millions to millions of dollars that we've spent on research and development on this particular subject. More than 70 percent of Australian pregnant sows are now spending more than 90 percent of their pregnancies in this loose housing and we're aiming over the next couple of years for the whole industry to be able to meet that standard and it's worth noting that of the 10 million dollars worth of imported pork arriving on Australia shores every week that all of it comes from countries with the exception of one country which is the Netherlands and a small proportion all of it comes from countries that are still using sows stalls. So the the health the well-being and the ultimate productivity of our pigs is critical and we continue to find new ways to improve and to do it better than our competitors. Thirdly pork how has our pork changed our product integrity system that I've already described means that we know today more about our pork products where they come from how they've been produced than at any other time in the industry's history and we also know more about what makes a great eating experience how to replicate that experience consistently and how to build a platform on our pig farms for achieving it our eating quality pathways project has identified the key inputs on this slide to more enjoyable pork and ultimately we plan to have these conditions built into a module of APK called the Assurance System and what's changed with respect to our relationship with the consumer the past five years has seen us be able to engage with consumers in a way that's developed a more distinctive image for pork it's given it a higher awareness of a its centre of plate status as an alternative and it's emphasised some specific health attributes and our slightly cheeky porked him advertising campaigners successfully increase the recognition of pork as a real option I'm going to press this button now and just remind the technician I need a bit of sound because it's it's one of these ads it's finished I want can you go back to the start of that one hello you know she pocked him really she pocked the whole neighbourhood an authentic italian's bag bowl tastes better with pork doesn't really work without the visuals in fact it's much worse without the visuals so to really impress get some pork on your fork so we'll just accept that as a Murphy and technology failure so people pigs and pork where does that take us the town's a bit corny but for our industry we like to think it adds up to some pride pride in our people pride in our pigs and pride in our pork and very often in agriculture we we become defensive we become slightly evasive we even sometimes become a bit apologetic about what we do and it shouldn't have to be that way we should be comfortable with anyone choosing in my case choosing to take a look at our world coming on to a pig farm unannounced checking it out looking around and being satisfied or even impressed with what they're seeing and so pride is reflected in how we aspire as an industry to be more transparent for the community to want if they want to know about us to be able to find out an industry that's not afraid of other seeing what we do and in fact is proud to show it off to those who care to take a look and so that's the ultimate in community transparency as an industry we're working on it it's fair to say that we're not there yet absolutely and we've got a lot of work still to do but it certainly is a track that we've decided to take and we believe it's highly integral to our future success so are the changes that we're making as an industry leading to us meeting these various challenges and what's the actual health of our industry the numbers speak for themselves a bit so you can have a look at some of those our industry has shown consistent growth since 2010 in terms of consumption as shown on this graph but also prices these are pig prices ex farm gate in more recent times I think everyone here has heard at 16 times at least today that there's a shortage of beef and the serendipity of that shortage is only exacerbating this longer-term trend for our industry these strong demand increases over time have been realised through both price and volume adding up to the value and that of course has also meant some well-earned profitability for our producers so what's next for our industry look to our north China is a nation that produces and consumes around half of all the world's pork they've got a huge and growing middle class looking for higher protein consumption every year and pork is their protein of choice their pork industry however is in a major transition period where they're moving from backyard production to a more modern-day intensive system which is affecting the stability of their their available volumes and they've also got significant concerns around their food safety systems across the board for pork as well as for many other food commodities and in this scenario Australia offers some very attractive options we've got a modern pork industry we've got some of the globally leading edge technologies around product integrity we've got a second to none food safety record and reputation and our consumer research in China indicates that their attitude to food production in Australia is extremely complementary so all of the dominoes line up in a very positive way for a future business in China but it's not going to be that easy for us we don't trade in pork today with China and the reason is that we have no trade protocols negotiated getting that job done is quite a deal as the beef industry guys already know and it shouldn't be underestimated it will take us many years so that's just a bit of our story our industry's made some major investments in change we're going to continue to do that we believe we have to to remain competitive we're a different industry to what we were five years ago we're going to be a very different industry in another five years addressing challenges is a journey it's not a destination and it'll continue to keep us very busy so thanks for your attention