EU hide rules could cost Aussie beef producers within weeks

Australian beef producers could face a new fee for hide disposals in a matter of weeks, as the new EU deforestation rules threaten to shut down a crucial export market worth millions.

Australian beef producers could be charged for disposals of hides within weeks as European Union rules around deforestation begin to bite.

An end of year deadline for declaring geolocations of cattleunder the EU deforestation regulations, which means producers be able to show their stock comes from land that has not been cleared or deforested after December 31, 2020.

But the the 90-day shipment time from Australia to the EU will force hide exporters to stop buying skins destined for that market within two weeks unless their geolocation can be tracked.

While only EU-accredited cattle producers can supply beef to the EU, all could supply hides until the latest deforestation regulations came in.

Australian Hide Skin and Leather Exporters Association executive officer Dennis King travelled to Europe this week to join other hide suppliers from around the world to lobby for their exclusion from the new regulations and said he was “always hopeful”.

Australian hide sales could be caught up in the European Union Deforestation Regulations, largely designed to limit supplies from other countries. Photo by Joao Laet / AFP.

But if hides were kept in the regulations, then all Australian beef producers would be affected.

Mr King said there would be an immediate impact on the market; about 30 per cent of hides go direct to Italy, while others end up in Europe after being processed in other countries such as China.

He said if processors could not sell the hides, then this could come as a charge to producers, given they may need to be disposed of.

“The value of cattle will be affected in some way - we like to call the hides and offal the ‘fifth quarter’ and they help to keep processors profitable,” he said.

Meanwhile, only about 50 per cent of the 3137 producers registered to supply the EU market have nominated their geolocation to date.

Australian Meat Industry Council chief executive Tim Ryan said Australian processors were experienced at using Australia’s strong traceability systems and these would be used to meet EUDR requirements.

“Processors will be reliant on the geolocation data provided by producers, as well as on-plant assurance and traceability systems to provide accurate geolocation data and traceability along the supply chain, to ensure EU eligibility,” Mr Ryan said.

“Noting production lags and shipping times, the fact is that processors are already processing beef products (including beef and hides) for the EU market that will arrive after January 1, 2026 and will require geolocation data to enable them to be imported.”

About 1 per cent of Australian beef shipments to the European Union will be audited to check their geolocation to prove the cattle have not been run on deforested land.

Queensland beef producer, processor and exporter Josie Angus said while Australia was considered low risk under the new EU requirements, 1 per cent of all shipments would still be audited each year.

“That 1 per cent could be one container, but even in one carton there could be beef from four different national vendor declarations,” Ms Angus said..

Ms Angus said while the EU was Australia’s most valuable market on a dollar/kilogram basis, the difficulty in proving cattle had not run on deforested land would make it challenging.