MLA expects global beef demand to grow in the near future


However, competition from pork, chicken and from alternative proteins is likely to increase.

Posted on Jun 18 ,09:58

MLA expects global beef demand to grow in the near future

Global demand for beef is to increase in the following years, believes MLA Managing Director Jason Strong. In his opinion, the global production of beef is also set on a growing trend but the competition from old proteins and new ones is expected to become stronger.
There’s a massive 50 million tonne demand globally for beef but Australia produces only 3% of the total. That means intensifying competition from pork and chicken – which can be produced faster and in smaller environments – and from alternative proteins, is something the Australian beef industry must watch very closely, Jason Strong explained during the latest BeefUp Forum.
"We have to be conscious of the position alternative proteins are taking up in the market. However, global protein demand is currently unmet and they present opportunities for filling the void. While we can’t be naïve about alternative proteins as a competitor, there’s some opportunity before us in this space. Our product has only one natural ingredient,” he said pointing out to the long list of ingredients in alternative proteins – additives, preservatives, salt and a range of other components.
On the other hand, increased demand from the Asian countries is a fact that it can be clearly seen at this time. China is now Australia’s third largest market, and with a huge population and growing affluence, it’s likely to stay that way. It is also a recent market for Australian beef.

"China has always had high-quality restaurants, but it’s been hard to get our product into them. That’s now improving. It will continue to increase in value as we get more and more consistent business relationships.
Keep in mind most of the meat relationships we have in China are only 5–10 years old, so it’s a new market in the wider scheme of things. The live export opportunity is also significant but constrained by non-tariff issues, such as having to feed and process over there and how the cattle are described,” explained Mr. Strong.

AN MLA research in South East Asia has identified key cities in the region where the average household disposable income is the highest. Singapore, Jakarta, Kuala Lumpur, Bangkok, and Ho Chi Minh are the frontrunners and MLA programs are designed to influence the target consumers within these cities.
"Go back to the 50 million tonne beef demand and our 3% – we’re not trying to get to all the consumers. Anyone of probably 15 countries could eat everything we export. We don’t need to be in countries where the GDP is greatest. Where we need to go is where the customers exist who are able to pay the most for the products we have. We have to capture the best customer to maximize returns. Margin is what drives prosperity, " added Jason Strong.

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