When the beef stakes are high, Wagyu beef steak prices are generally even higher.
Such is the demand for the breed whose popularity is now so great it commands its own commodity grouping – separate to beef – at major international trade shows.
And experts remain upbeat about its future, saying the Wagyu bubble shows no signs of bursting anytime soon.
Wagyu, renowned for its marbling and eating quality, has gone from zero to hero since its introduction to Australia in the early 1990s. Wagyu beef now sits squarely at the top of menus at high-brow restaurants, has become an industry leader in genetics and performance, and continues to deliver record prices to producers. When feeder steers from other beef breeds were commanding $2.20/kg liveweight in the Australian marketplace last year, Wagyu was selling for $6/kg.
Last year was a big one for the breed. National registration numbers grew 39 per cent, bucking the trend of stagnant memberships of most beef breeds and a regular online breed auction was introduced – leading to an immediate 50 per cent jump in prices for producers. Meanwhile, local Wagyu took top honours in an international steak competition.
Australian Wagyu Association president Peter Gilmour says the breed has evolved from “a cottage industry when we started” in the early 1990s to “a sophisticated supply chain industry” that is experiencing “unprecedented growth”.
“And I don’t think we’re at our peak yet,” Gilmour says. “With a peak you usually see price resistance. We’re not.”
In fact, he sees opportunity. With estimates Wagyu accounts for less than 1 per cent of national beef herd numbers and about 8-9 per cent of feedlot space, there’s room for growth.
Gilmour says the popularity of Wagyu is “all in the eating”. “Once you get well-performing Wagyu, it has that absolutely exquisite eating that counts for everything,” he says.
It’s this taste sensation that won a NSW family-run specialist beef producer World’s Best Steak at the World Steak Challenge in London last month, for the second year running. The honour was the culmination of decades of hard work for the Warmoll family, which was among the first in Australia to breed Wagyu in the early 1990s.
Initially involved in the live export of Wagyu to Japan, the Warmolls started grainfeeding the cattle themselves in the late 1990s and processing them under their own brands, including Jack’s Creek Wagyu, in 2000. Today, the company’s operations are centred on 14,000ha at Werris Creek and Breeza on the fertile NSW Liverpool Plains, with a head office in Tamworth.
It’s a truly family affair. Patrick Warmoll, who joined the business nine years ago, is managing director and responsible for the lotfeeding, processing, marketing and export of the cattle. His uncle, David, looks after the breeding operation, younger brother Robert is in charge of backgrounding while his father, Phillip, controls the farming side of the business.
The Warmolls run 1000 breeding cows, which account for just 10-15 per cent of its total Wagyu production. The balance, which must adhere to strict standards, is bought in at “various supply points, whether it’s young cattle for backgrounding, at feedlot entry or slaughter”, Warmoll says.
The family processes 900 cattle a week, including 160 Wagyu, for its brands. Cattle sold under the Jack’s Creek Wagyu brand are a minimum F2, or 75 per cent Wagyu, and fed grain for 450 days. There is also an “entry level” product for F1 cattle, sired by a Wagyu bull and out of an Angus mother, which are grain fed for 300 days, as well as two Angus brands. Ninety per cent of the beef the Warmolls produce is exported. Saudi Arabia is the family’s biggest market, taking about 20 per cent of supply, followed by Japan (18-19 per cent), Europe (10 per cent), China (9 per cent) and Korea (6 per cent).
On the domestic front, Jack’s Creek supplies high-end restaurants including Sydney’s Aria, Lumi, Q Station, Chophouse and GPO Prime. At GPO Prime, a 200g Jack’s Creek Wagyu fillet with a marble score of six will set you back $89 (or $445/kg).
Warmoll considers branding “everything”. “Meat was still meat in the ’90s but that whole branding and provenance, where meat is coming from, is very important now,” he says. “A lot of the time we are selling a supply chain, not just a story. Everyone wants to know not only what your breed standards are and the specifications of your meat, they want to know about your husbandry techniques and how the animals live, their life cycle and whether they’re happy and stress free.
“If you can pivot that to your brand you’ll go really well.”
Warmoll says winning the world steak competition last year, and again last month, opened up many doors domestically. “It’s really given us an edge to break into a few of these restaurants and get the chefs to sit up and take notice,” he says.
He says a Wagyu’s cost of production is significantly higher than other cattle, due to the amount of time they are fed for (450 days), compared to other breeds (70 to 300 days).
“It would be the only product in the world that can keep going up and up and up, and not find a ceiling”.
“When you go to a trade show and have a look at the various proteins a distributor is offering – they’ll have poultry, game, beef, lamb, goat and then they’ll have a category these days just for Wagyu,” he says. “It has established itself as more than just a breed, it is a life cycle.” A life cycle that appears to have a pretty healthy prognosis.
James Wagstaff, The Weekly Times – published November 11, 2016