Australian beef industry must adjust for succeding in Asian markets - analyst
Australia has the potential to increase its grain-fed beef exports in the Asian markets, especially China, by 65% to 2030, according to Angus Gidley-Baird, senior animal protein analyst at Rabobank, but industry must adjust to tackle multiple challenges and risks that lays ahead.
"Maximising the chances of succeeding in these markets will require adjustments to the Australian beef system. Producers, backgrounders, feedlots, and processors will all need to be aligned", he said.
Producers and backgrounders will need to produce more consistent volumes and animals with qualities that will perform in feedlot systems. Feedlots will need to better manage feed grain supplies and to encourage crop farmers to focus on feed grain production, and processors will need to incentivize the production of meats with qualities that meet the market specifications, explained the analyst.
If these conditions are to be met, the export volumes can reach 500,000 tonnes according to the bank's projection. At this time, China is the world's largest importer of beef. According to Meat and Livestock Australia (MLA), in the 2018-19 financial year beef exports reached A$9.49 billion (US$6.41 billion), a 19% increase on last financial year and A$446 million (US$298 million) higher than the previous record set in 2014-15.
There was prominent growth across all of Australia’s major beef export markets:
- Japan: $2.31 billion, up 9% year-on-year
- US: $1.94 billion, up 13%
- China: $1.75 billion, up 74%
- South Korea: $ 1.50 billion, up 28%.
At the same time, cattle on feed inventory set another record, at 1,147,400 head. Cattle on feed were sustained over 1.1 million head for the entire year.
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