In the long negotiation between geography and commerce, Tasmania's cattle farmers have found themselves on the losing side of an equation they did not write. Woolworths, citing the compounding costs of Bass Strait freight and monopolised processing infrastructure, will cease purchasing Tasmanian beef by the end of 2026 — ending a supply relationship that had offered local producers something agriculture rarely guarantees: certainty. The decision does not reflect the quality of what Tasmanian farmers raise, but rather the structural penalties of producing on an island at the edge of a continent
Woolworths exits Tasmanian beef by 2027 citing logistics costs
Tasmanian cattle farmers lose a major market outlet and contract security, forcing them to seek alternative buyers in an already constrained market.
another kick in the guts for Tasmanian producers
Mark
Why does Woolworths care about the cost of killing and processing beef in Tasmania? Couldn't they just absorb it?
Mimi
They could, but supermarkets operate on thin margins. When you add the kill fee at JBS plus the freight across Bass Strait both ways, the Tasmanian beef becomes more expensive to deliver than beef from the mainland. At some point, the math breaks.
Luke
Do we know what those actual costs are? The story says "exorbitant" and "expensive," but we don't have numbers.
Mimi
No, we don't. Nichols and Woolworths both reference the costs, but neither has disclosed the figures. That's a real gap.
Mark
What happens to the farmers now? Do they have other buyers?
Mimi
That's the harder question. Nichols mentioned he'd approach JBS or Greenham, but there's no guarantee either will offer him a contract with the same security. Coles doesn't buy Tasmanian beef at all.
Luke
And we don't know how many farmers are affected, do we? The story mentions Nichols and references "a small group of local farming partners," but no total number.
Mimi
Right. Woolworths said it was a small group, but "small" could mean three farmers or thirty. We just don't know the scale of the impact.
Mark
Is this unique to beef, or are other Tasmanian agricultural products facing the same pressure?
Mimi
Lamb seems to be doing okay—Coles buys it heavily. But pork isn't bought by either major chain. So it's not universal, but beef and pork are both out.
Luke
The real issue underneath this is infrastructure, isn't it? Tasmania has no independent abattoir.
Mimi
Exactly. That's the structural problem. Without one, farmers are dependent on JBS's pricing and Woolworths' willingness to pay for the inefficiency. Once Woolworths decides it won't, there's no alternative.
Der Puls
- Woolworths' exit strips Tasmanian cattle farmers of their most stable market outlet, leaving producers like Scottsdale's Jerrod Nichols — who supplied forty head every fortnight — suddenly exposed in a thin and unforgiving market.
- The economics were always fragile: cattle shipped across Bass Strait, processed at JBS Foods' Longford plant under steep kill fees, then returned to Tasmania for sale — a round trip across what one farmer calls the most expensive stretch of water in the world.
- With Coles already absent from Tasmanian beef purchasing entirely, the loss of Woolworths effectively halves the major supermarket market available to island producers overnight.
- Farmers are now in urgent talks with processors JBS and Greenham, hoping to negotiate fixed contracts that might replicate the predictability Woolworths once provided — though no such agreements are guaranteed.
- Woolworths has pledged support through the transition, but the substance of that commitment beyond 2026 remains undefined, leaving producers to navigate a market that has quietly, decisively contracted.
In the long negotiation between geography and commerce, Tasmania's cattle farmers have found themselves on the losing side of an equation they did not write. Woolworths, citing the compounding costs of Bass Strait freight and monopolised processing infrastructure, will cease purchasing Tasmanian beef by the end of 2026 — ending a supply relationship that had offered local producers something agriculture rarely guarantees: certainty. The decision does not reflect the quality of what Tasmanian farmers raise, but rather the structural penalties of producing on an island at the edge of a continent, where distance is a tax and options are few.
Woolworths has announced it will stop purchasing Tasmanian beef by the end of 2026, citing freight costs across Bass Strait and expensive processing fees at the state's only abattoir — JBS Foods' Longford plant — as making the supply model economically unworkable. The decision lands hard on farmers who had come to depend on the supermarket contract for a stability that is rare in agriculture.
For Jerrod Nichols, a Scottsdale cattle farmer who had been supplying roughly forty head every fortnight, the Woolworths contract had been foundational — not just commercially, but psychologically. Knowing a buyer was committed had made continued investment in the business feel rational. When the news arrived, he was not entirely surprised. The structural problems had always been there: cattle leaving the island for mainland processing, then returning for local sale, with JBS charging what Nichols describes as exorbitant kill fees at every step.
George Shea of TasFarmers' Livestock Council noted that Tasmanian producers simply have fewer options than their mainland counterparts. Coles does not buy Tasmanian beef at all — nor does either major chain purchase Tasmanian pork. The market was already narrow before this decision made it narrower still.
Nichols has since met with Woolworths representatives and confirmed what the numbers had long suggested: freight and kill costs were the deciding factors. He is now weighing approaches to JBS and Greenham in search of a fixed contract that might restore some of the certainty he has lost. Woolworths says it is working with affected farmers through the transition, though what that support entails — and how long it extends — has not been made clear. Tasmanian cattle farmers are left to find their footing in a market that has just grown smaller.
Woolworths has decided to stop selling Tasmanian beef across its stores—both in Tasmania and on the mainland—by the end of 2027. The supermarket chain cited rising production and shipping costs as the reason for the exit, a decision that has left local cattle farmers scrambling to find new buyers in an already thin market.
Jerrod Nichols, a farmer in Scottsdale, had been supplying roughly forty head of cattle every two weeks to Woolworths for the past two years. That contract had given him something rare in agriculture: predictability. In a market that swings wildly, knowing Woolworths would take his cattle had been, as he put it, paramount to his willingness to keep investing in the business. Yet when the news came, he was not entirely shocked. The economics had been working against the arrangement from the start.
The problem sits in Tasmania's geography and infrastructure. There is no independent abattoir in the state—no facility that operates on contract or service kill basis. Woolworths had been forced to use JBS Foods' plant at Longford, the only option available. JBS, a multinational corporation, charged what Nichols describes as an exorbitant kill fee. Then came the real cost: the cattle had to be shipped across Bass Strait to Victoria for processing, then shipped back to Tasmania for sale. That round trip across what Nichols calls "the most expensive piece of water in the world" made the entire supply chain uneconomical. Woolworths will continue buying Tasmanian beef through the end of 2026, but after that, the relationship ends.
George Shea, who chairs the Livestock Council and Red Meat & Wool Committee for TasFarmers, acknowledged the pressure farmers are under. The cost-of-living crisis has already squeezed margins. Now they face the loss of a major, stable outlet. Shea noted that Tasmanian farmers have fewer options than their mainland counterparts—they have to work with what is available, which is not much. Coles, the other major supermarket chain, does not buy Tasmanian beef at all. Neither Coles nor Woolworths purchase Tasmanian pork. Coles does buy Tasmanian lamb, and supplies it to customers across the east coast for about nine months of the year, but that is a different product and a different market.
Nichols said he met directly with Woolworths representatives to understand the decision. The freight costs and kill fees, he learned, were the bulk of it. He now faces a choice: approach JBS or Greenham, another processor, and try to negotiate a fixed contract that would give him the same kind of security he had with Woolworths. Whether either company will offer that is uncertain. A Woolworths spokesperson said the company is "very mindful of the impact" on its farming partners and is "working directly with those affected to support them through this transition period." What that support looks like, and whether it extends beyond the end of 2026, remains unclear. For now, Tasmanian cattle farmers are left to navigate a market that has just become smaller.
Bemerkenswerte Zitate
Because there's no contract kill abattoir or service kill abattoir in Tasmania, they were having to use JBS and, being a multinational company, they were charging them an exorbitant price to do that kill.— Jerrod Nichols, Scottsdale farmer
Farmers—especially in Tassie—always need to be proactive in marketing their stock and looking for their best options. Unfortunately, we don't have the same number of options as they do on the mainland.— George Shea, Chair of TasFarmers' Livestock Council
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