Although down from July and August highs, Australia’s chilled/frozen beef exports remained robust in September with volume (94,923 mt) up 19 percent from a year ago. As has been the case all year, September export growth was led by China, with volume (14,521 mt) 3.5 times larger than a year ago. Australia’s exports to China started gaining momentum in mid-2012 and exploded by February of this year.
A significant setback occurred when China banned chilled beef from Australia in late August. September chilled exports plummeted to 38 mt, down from 1,182 mt in August. Through September, chilled beef accounted for 11 percent (12,237 mt) of Australia’s total beef exports to China. Some customers are expected to switch to frozen, but the ban on chilled will have a negative impact on the high-end foodservice and retail customers. Because China remains closed to U.S. beef, these customers do not really have an alternative supplier of high-quality chilled cuts. Based on January-August import data, Australia accounted for 97.5 percent of China’s chilled beef import volume this year.
Australia’s September exports were also boosted by strong growth to the United States (19,504 mt, +10 percent) and South Korea (12,671 mt, +8 percent), offsetting a decline to Japan (21,766 mt, -4 percent). Even stronger growth was seen in smaller markets including the Middle East (5,314 mt, +92 percent), Indonesia (2,222 mt, +35 percent), Russia (3,826 mt, +41 percent), and the EU (1,865 mt, +52 percent).
Despite lower exports to leading markets Japan (219,398, -6 percent) and the U.S. (155,137 mt, -8 percent), January-September exports were up 15 percent to 798,913 mt with widespread growth in other markets. Exports to China (108,199 mt) were up 11-fold and exports to the Middle East (48,736 mt) more than doubled from last year. Exports were also larger for Korea (99,487 mt, +21 percent) Indonesia (23,298 mt, +18 percent), Philippines (19,270 mt, +18 percent), the EU (14,808 mt, +44 percent) and Canada (11,750 mt, + 22 percent), but lower for Taiwan (26,592 mt, -6 percent), Russia (21,265 mt, -28 percent) and Central/South America (7,635 mt, -50 percent).
Australia’s cattle prices have still not recovered from the drought-related liquidation, with prices down 11 percent from last year and further pressured by the weaker Australian dollar. Ample supplies and competitive prices have given Australia an export advantage this year, but the situation could change with an increase in rainfall and corresponding rebuilding of herds.
Export data source: Australia’s Department of Agriculture, Fisheries and Forestry