Indian beef meat sector will remain a volatile market for the next decade
OECD and FAO's Outlook stated that India exported 1.56 million tons of beef in 2016 and that the country was expected to maintain its status as the world’s third-largest exporter,” accounting for 16% of global exports in 2026” by exporting 1.93 million tons that year.
Furthermore, the Outlook report ranked Brazil as the world’s top beef exporter, followed by Australia.While the total beef exports worldwide were 10.95 million tons in 2016, according to the report, they will be reaching 12.43 million tons by 2026.
Meanwhile, another report published by Meat & Livestock Australia "Market supplier snapshot/Beef" states that the Indian beef and buffalo meat sector "remains a volatile market and is highly vulnerable to domestic and international trade regulations."
India holds the world’s largest bovine herd
India has the world’s largest bovine population – an estimated 304 million head (cattle and water buffalo). MLA expects the country’s beef and buffalo meat production to reach 4.25 million tons cwe by the end of 2017 and increase by 1.2% in 2018, to 4.3 million tons cwe driven by population growth and steady export demand.
Although India holds a high production in this sector, MLA's report stressed that conditions at local abattoirs producing meat for the domestic market often lack sufficient infrastructure necessary for hygienic production and no chilling and further processing is done. On the other hand, the export trade is supplied almost exclusively by large-scale abattoirs with modern processing facilities, approved by the Indian Ministries.
Vietnam, Malaysia and Egypt – India’s main export markets for buffalo meat
At the beginning of 2017, the Indian buffalo meat exports were impacted by the demonetisation policy, but sales recovered in the following months, increasing by 2% to 672,933 tons swt between January and July and MLA expects that the exports will continue to rise in 2018. MLA’s forecast for 2018 takes into account a strong demand for Indian beef from the Middle East, Africa and South-East Asia, still analysts say that volumes are expected to remain below the 2014 peak.
Referring to exports, the MLA report says that India ships more than 40% of its beef and buffalo meat from its total production to South-East Asia and the Middle East. In 2017, the country's beef exports have also risen significantly to Iraq, Indonesia, Russia and Turkmenistan.
The primary export markets for Indian buffalo meat are Vietnam, Malaysia and Egypt, with frozen bone-out accounting for almost 100% of shipments to these markets.
Indian buffalo meat is preferred in some markets due to its affordability, leanness and Halal characteristics. India is very price competitive on the global stage, being the largest andmost affordable supplier of frozen commodity beef, according to MLA analysts.
India represents a strong competitor for the Australian beef industry, but, as noticed by MLA analysts, the country currently has no access to Australian's high value markets such as Japan, Korea, US and the EU, with the prospects for change being low.
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