Four consecutive months of decline in Australian beef exports


September beef exports were 73,000 tonnes, down 31% on year-ago levels, reports MLA.

Posted on Oct 08 ,07:37

Four consecutive months of decline in Australian beef exports

Total beef exports have declined for the fourth consecutive month in a row, totalling 73,000 tonnes swt in September. This represents the lowest month of beef exports (excluding January due to processor shutdowns) since April 2017, which was a similar year of herd rebuilding, reports MLA. Year-to-September beef exports are back 11%. While these figures are subdued, it is important to recognise that 2019 and 2020 are very different years from a supply perspective. 2019 was a particularly exceptional year, with drought-induced turn-off resulting in heightened production volumes, which enabled exporters to respond to very high levels of international demand. This year, beef exports will remain subdued, constricted by a smaller herd and tightening slaughter levels, similar to 2015 and 2016, two years which also followed a substantial period of drought.
Japan remains the top destination for Australian beef, taking 20,500 tonnes swt in September. Reports indicate that foodservice demand in Japan experienced a low in April, however, has been on a gradual path of recovery since. The pandemic situation in Japan remains fluid, with daily new case numbers still counting several hundred, and consumers showing signs of ‘COVID fatigue’, with some reportedly not adhering to social distancing rules.

Competitor presence within China has continued to increase. In August, imports from Brazil and Argentina reached 88,000 tonnes swt and 45,000 tonnes swt, respectively. Meanwhile, China has placed temporary trade suspensions on several Australian export establishments, with this pressure impacting Australian export volumes. Beef exports to China reached just 10,000 tonnes swt in September, back from a colossal 28,500 tonnes swt shipped in the same month last year.

Beef export volumes to the US have also retracted over the past few months, down to 16,000 tonnes swt in September. A combination of increased competitor activity and a higher USD-AUD exchange rate will implicate demand for Australian product.

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