Cattle industry defies headwinds as global demand for Australian beef soars
Trade wars between superpowers have unexpectedly delivered a windfall for Australia's cattle industry as producers capitalise on supply shortages.
There’s every reason for the cattle industry to be feeling bullish despite some fierce headwinds this year.
Global trading shenanigans with the announcement of a 10 per cent tariff on imports into the US (but scrapped last month) created worry - but in the tariff wars, it was Australia that came out on top.
The US remained our biggest customer, taking 412,068 tonnes of beef until the end of November; in the angst between the US and China, Australia stepped in to fill the void.
Yet there were trade-offs – Australia agreed to allow beef processed in the US but sourced from Canada and Mexico into the country, essentially removing restrictions that had been in place since 2003, prompting biosecurity concerns.
Cattle Australia chief executive Will Evans said the industry had fought hard on issues such as trade, as well as carbon and climate accounting systems.
“In arguing our case for open international trading regulations, we took a strong stance that science-based biosecurity standards are non-negotiable,” Mr Evans said.
“While trade conditions were solid, CA is adamant the federal government must remain eternally vigilant on biosecurity.”
There were also wins for the industry, Mr Evans said, over land management, with ticks given to the industry on its sustainability credentials by the likes of Woolworths, Westpac and the European Union.
On the ground though, a surprising end of year lift in values has added confidence to a sector already riding high on record exports.
The benchmark Eastern Young Cattle Industry closed November on 870c/kg carcass weight, riding 200c/kg higher than a year earlier, and mostly due to burgeoning exports.
Meat and Livestock Australia global market analyst Tim Jackson said an increasing pool of customers wanted Australian beef.
While the big four – US, China, Japan and South Korea – dominated exports, other markets were emerging, which boosted demand.
“If you look at grain-fed beef exports, the United Arab Emirates comes in fifth followed by Saudi Arabia and then Thailand,” Mr Jackson said.
“We have had an $A which is in the low to mid 60s, which has not been prohibitive at all to exports.
“And in terms of global supply, we are operating in a market where the US is producing less, and where demand in the US is growing.”
