Types of Co-products
There are four main classifications for co-products:
Offal
Australia exports approximately 80% of its offal production to premium markets throughout the world - Japan is the single largest export market.
Not all offal produced by domestic processors is edible. Inedible offal may be exported, used in the rendering process, or turned into blood and bone fertiliser. Best returns are gained when inedible offal is on-sold to the pet food industry.
Rendered products
Tallow
Tallow is the purified fatty material extracted mostly from ruminant tissues by heating the tissues to break open fat cells and melt the fats. Tallow is distinguished from other fats and oils by its high melting point, which makes it solid at room temperature.
The main use of tallow is in soap-making. It is also used to derive oleochemicals such as glycerine, fatty acids and mono and diglycerides which have many applications from use in truck tyres to cosmetics. Tallow derived from edible tissue is used to make edible products such as frying fats and margarine.
Australian tallow production is tied to slaughter numbers but has been estimated to be about 560,000 tonnes per year. Approximately 70% of total tallow production is exported. The main markets are China, Taiwan, Nigeria and Pakistan. The US dominates the tallow industry, so all prices follow US market trends.
Tallow competes with palm stearine in most markets, and since production of palm oil overwhelms tallow production, tallow prices tend to follow palm stearine.
Meat and bone meal
Meat and bone meal includes co-product derived from edible or inedible components such as bone, hooves, horns, heads, fatting trimming, viscera and feet. These tissues are defatted to extract the tallow and the defatted solids are dried and milled to make meat and bone meal.
- Bone is used in the production of fertiliser, glue, china and charcoal.
- Horns and hooves are used to make glue, fine lubricants and as a leather softener.
- Inedible offal and meat are used in the production of meat meal, an important feed for other industries.
The main use of meat and bone meal is as a protein, calcium and phosphorus supplement in animal feeds, including poultry, pig and aquaculture feeds. Meat and bone meal is also used in some pet foods and a small amount is used in fertilisers. About 40% of Australia’s production of meat and bone meal is exported.
Since October 1997 meat and bone meal has been banned as a feed for all ruminant animals.
Australian Meat and Bone Meat Nutritional Technical Review (2003)
Blood meal
Blood meal is produced by coagulating blood by injecting steam, draining off the free water and drying and milling the de-watered blood solids to make a powder. The main use of blood meal is as a protein supplement in pig and poultry feeds. It is particularly useful for its lysine content since vegetable protein meals are deficient in lysine.
Australia produces about 30,000 tonnes of blood meal per year; most of which is used in poultry and pig rations within Australia.
Hides and skins
Cattle hides
Cattle hides are the second most valuable beef co-product, accounting for 20% of an animal’s value. Although the Australian tanning industry is expanding, most hides are still exported in a preserved condition prior to tanning; the primary markets are Japan, China and Italy.
The leather from hides are used in a number of ways such as clothing, shoes, saddles, sporting goods and furniture.
Sheep skins
Sheep and lamb skin prices are driven by export demand and supply. Turkey and China have been the major markets in recent years because both countries produce and export goods manufactured from skins. Ultimately, demand for these goods such as garments, footwear and seat covers, drives the export price of skins.
Pharmaceutical products
During the slaughtering process, foetal blood and gall is extracted which are then further processed and used to make pharmaceutical products.
Foetal blood
Foetal blood is refined into serum before being exported to pharmaceutical companies where it is used to produce vaccines and cell cultures.
Concentrated gall
The main constitutes of beef and sheep bile (gall) are cholic acid and deoxycholic acid. The bile acids are used as precursors to make various corticosteroids (which are used to provide relief for inflamed areas of the body).
Raw gall is concentrated by evaporation to a solids content of 75%. Concentrated gall is exported for further processing to extract and process the bile acids.