Australian meat: How the Indian buffalo could hit our red meat exports

Indian buffalo meat may seem a strange choice for Australian consumers. But its popularity in Asian nations could pose a threat for Australian red meat exports.

Indian buffalo meat is a popular protein in south east Asian countries such as Indonesia. Picture: Zoe Phillips.

INDIAN  buffalo meat could prove a competitor for Australian beef in Indonesia, as the country begins to recover from the impact of COVID-19 on its economy.

Buffalo meat, or carabeef, is an affordable protein for consumers across Indonesia, Vietnam and Malaysia, and lends itself well to South-East Asian cuisine.

A recent Meat and Livestock Australia report showed the ongoing impact of the coronavirus outbreak in Indonesia has resulted in “weaker Indonesian consumer confidence and reduced purchasing power”.

Rabobank analyst Angus Gidley-Baird said India was a major exporter of carabeef, with a vast portion of the bovine meat going into southeast China.

“It’s a very cheap protein. India in general is one of the top exporters of bovine meat. There is a Hindu population that don’t consume it,” Mr Gidley-Baird said.

Indonesia imports about 170,000 tonnes of carabeef from India a year, Mr Gidley-Baird said.

“There’s the possibility (carabeef) exports into India could go up to about 200,000 tonnes.”

Mr Gidley-Baird said Australian live cattle export prices were sitting at about 355c/kg liveweight, with the potential to go higher when Indonesia fills up feedlots in the lead-up to Ramadan and Australia’s wet season hampered farmers’ efforts to pull cattle off properties to sell.

“There’s a squeeze in the supply chain, and the producers are lucky at the moment they’re still getting paid a competitive price, but feedlots and others in the supply chain are wearing that,” Mr Gidley-Baird said.

Thomas Elders Markets analyst Matt Dalgleish said Australian heavy steer prices were the dearest in the world.

“Australian heavy steers are sitting at 386c/kg, compared to the US heavy steer which is about 325c/kg,” Mr Dalgleish said.

“That’s a 19 per cent premium. It’s a disadvantage for us. Normally, the average discount we normally sit at is about 30 per cent.”

While carabeef could pose a threat to the competitiveness of Australian beef in the Indonesian market, any form of red meat was ultimately more expensive than protein such as chicken.

“It’s another product in the market that does provide competition. But in Indonesia, in tough economic conditions consumers will move away from red met, as it’s still more expensive than chicken,” Mr Gidley-Baird said.

“Indonesian retail prices for beef, which could include Australian cattle, haven’t collapsed. But they haven’t gone up that much. It’s not like carabeef is the lowest cost protein on the market.”

MORE

ZEBRA BURGER: WILD AND WACKY MEAT HITS THE MENU

SURGING CATTLE PRICES: IS THIS THE NEW NORMAL?

HOT SHEEP MARKET SETS NEW PRICE RECORDS