Pakenham Victorian Livestock Exchange to close next year amid soaring council rates, land taxes

The Pakenham saleyards will close next year on June 30. (ABC Rural: Kath Sullivan)

Crippling council rates and land taxes are behind a decision to close Victoria’s second-largest livestock market, the owner says.

The owner of the Pakenham saleyards, Victorian Livestock Exchange (VLE), shared the news with livestock agents on Monday after a “unanimous decision” by the board.

The 25-year-old facility is the closest of its kind to Melbourne and had undergone millions of dollars in amenities upgrades to handle 100,000 cattle destined for supermarket shelves each year.

VLE managing director Brian Paynter said the gates would be shut June 30 next year.

Up to 40 full-time and part-time employed at the Pakenham site will be transferred to its sister site in Leongatha, about 75 kilometres south-east.

“It’s a very important decision, one that wasn’t taken lightly, that’s for sure,” Mr Paynter told the ABC’S Victorian Country Hour.

Livestock prices have crashed this year, with prices for cattle less than half what they were a year ago.

Mr Paynter said Cardinia Shire Council rates had “doubled overnight”, and land taxes had hit record highs.

Those costs would equate to about $5 per animal sold at the saleyards, a cost Mr Paynter said should not be passed on to farmers.

“We’ve been hit with enormous increases in our council rates and our land tax, to the extent that we just can’t run a saleyard out of there, it’s just not financially viable,” he said.

“The only option was to close the doors.”

Future of other saleyards in doubt

Pakenham Associated Stock Agents president David Setches said while many agents already operated from Leongatha, where staff from the Pakenham site will be transferred, producers would likely send cattle elsewhere.

He said the roads leading to South Gippsland from Melbourne’s western and eastern suburbs were “goat tracks” that would struggle to carry thousands more trucks.

“If you’ve been down the South Gippsland Highway, she’s a pretty old, rough track down there at the moment with a lot of sand trucks around the Lang Lang area — the road’s just falling to pieces,” Mr Setches said.

The death of such a major site leaves a question mark over the long-term future of saleyards in general.

Most cattle are now sold directly to abattoirs, or between farms, while peri-urban agricultural areas are under pressure from urban growth.

“There’s certainly other platforms we can market cattle on, rather than send them down there,” Mr Setches said.

The company plans to sell the site, which Mr Paynter said was in a valuable location.

“It’s in a great spot in the heart of the industrial estate of Pakenham, so it is going to be worth a substantial figure,” he said.

“But we’ve got plans here at Leongatha, which are going to costs millions of dollars.

“So, we’ve certainly got places to invest any sale proceeds.”

Cardinia Shire Council and the Victorian Treasurer did not respond to requests for comment.