2017 Annual Report — Elders
Agency Services Elders provides a range of marketing options for livestock, wool, and grain. The Elders livestock network comprises livestock agents and employees operating across Australia conducting on-farm sales to third parties, regular physical and online public livestock auctions and direct sales to Elders-owned and third-party feedlots and livestock exporters. Elders is one of the largest wool agents for the sale of Australian greasy wool and operates a brokering service for wool growers. Our team of dedicated wool specialists assists clients with wool marketing, in-shed wool preparation, ram selection and sheep classing. Elders’ grain marketing model provides pricing from multiple buyers and offers a cutting edge commodity origination platform, maximising choice for growers.
Agency margin ($m)
90.5
106.2
111.4
FY15
FY16
78.8
FY13
FY14
Margin by product
Performance Livestock prices and footprint expansion drove margin improvement of $10.4 million. Cattle and sheep prices remained high throughout the year and rose on average 10% and 22% respectively. Sustained high cattle prices were driven by continued strong domestic, restocker and export demand. Elders’ wool earnings improved $0.8 million, despite bales sold being slightly lower than FY16. The higher wool market prices and corresponding wool earn per bale for Elders offset the lower activity.
85% Livestock
15% Wool
Margin split by geography
Elders’ grain platform transacted 0.2 million tonnes during the FY17 year.
Strategy To deliver profitable growth of the agency services portfolio through business improvement, recruitment and acquisition for our livestock and wool businesses and through focussed growth of our grain business. Strategy
Achievement
Plan
Operating model
—— Increase agency opportunity and earnings through StockCo expansion —— Long-term wool logistics and distribution agreement renegotiated
—— Continue livestock, wool and grain product development to improve and expand offering —— Continue footprint expansion through targeted acquisitions
People
—— Transition to variabilised remuneration structures which reward outperformance —— Selective recruitment of livestock and wool personnel
—— Continued footprint expansion through recruitment of key operatives with aligned values and performance characteristics
30
122.4
17%
West
51%
South
32%
North
FY17