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Australia Still Plugging US Beef Gap

12 May 2015

GLOBAL – The focus of Australia’s beef exports remains firmly on the US but Japan and Canada have come into the limelight recently for different reasons.

Canadian imports shot up last month while Japanese buying increased but not enough to correct the decline and regain the top Australian buyer spot from North America.

Canada’s buying spiked through much higher manufacturing beef shipments and is currently set to have quotas exceeded this year, along with the US.

Similarly, manufacturing beef shipments to the US were 55 per cent higher than a year earlier, although steak cuts were significant and 90 per cent higher.

Precipitation has had little effect on record slaughter rates, EBLEX analysts have reported.

Given this, Meat and Livestock Australia have shown a 55 per cent lift in US shipments and 98 per cent higher trade to Canada.

Both countries are in a trough in cattle numbers, with Canada now supplying its neighbour to the south.

“Canada remains in a tight supply situation,” said an MLA spokesperson. “Their herd has run down over the last five years, and large volumes of feeder cattle and cows being trucked to the US.

“This has resulted in fewer cattle and less beef available for domestic consumption, particularly with the US$ having appreciated, making it more expensive to import already dear US beef.”

More recently, however, insight from market analyst Steiner Consulting Group has shown a seasonal slackening in US beef buying, although a summer resurgence is expected.

MLA explained: “US buyers of imported beef have found themselves in a position that they have not had to chase as hard to ensure they have enough stock as they had to during the large price run-up last year.

“Australia’s exporters may need to bide their time before there is a resurgence in activity from end-users later in the US summer.”

And despite the huge growth in sales to the US, EBLEX has underlined the importance of Japan to Australia.

Looking longer term, the Japan Australia Economic Partnership Agreement (EPA) will lower tariffs. Frozen beef tariffs will fall to 19.5 per cent from 38.5 per cent and chilled beef will drop to 23.5 per cent from 38.5 per cent.

Predictions have increased for 2015 Australian beef production but they remain ten per cent back on last year. Despite this, 2015 is expected to see Australia break the one million tonne mark for the third consecutive year.

Michael Priestley

Michael Priestley
News Team - Editor

Michael joined 5m Publishing in October 2012 as editor of the TheCattleSite, TheBeefSite and TheDairySite. He studied English Language and Linguistics at the University of Sheffield before graduating with his Postgraduate diploma in Land Management at Harper Adams University College in Shropshire. Michael grew up in North Yorkshire, England and worked on local livestock farms in his youth.



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