Recent herd-rebuilding slowed Australia’s beef production significantly in the second half of 2015, with the latest data showing November production down 11.5 percent year-over-year. But annual chilled/frozen exports of Australian beef still reached 1.285 million metric tons (mt) – falling just short of the 2014 record (1.286 million mt). Exports were expected to trend lower at the start of 2015, but persistent drought conditions postponed the slowdown in production to the middle of the year. Through June, Australia’s exports were 10 percent ahead of the record pace of 2014, but exports in the second half were down 9 percent.
Exports were bolstered by the weak Australian dollar, which was down an average of 17 percent versus the U.S. dollar in 2015. Exports to the United States were record-large at 415,951 mt, up 4 percent from a year ago. Shipments also increased to South Korea (167,000 mt, +10 percent), China (148,222 mt, +19 percent, just short of the 2013 record), and Canada (42,575 mt, +29 percent). Exports declined year-over-year to Japan (285,223 mt,-3 percent), Taiwan (30,448 mt, -16 percent), as well as to Southeast Asia, the Middle East and Central/South America.
There were some concerns that Australia’s cattle prices were going to take a hit when business resumed after the holidays, but the indicator price reached A$6/kg on Jan. 13 – a new record, and up 38 percent year-over-year. In U.S. dollars, prices averaged $1.90 per pound, up 18 percent. Encouraging rain over the holidays helped support prices, and Meat and Livestock Australia expects Australia’s exports to decrease by 15 percent in 2016 based on smaller production – but rain remains key.
Data sources: Australian Department of Agriculture and Meat and Livestock Australia