Tough Q1 ahead for global beef export market

 

 

Meat & Livestock Australia (MLA) on Friday (January 23) revealed that export markets for beef may stay weak in the first four months of 2009 as buying slow down.

 

MLA said it did not expect significant purchasing until March at the earliest due to tight credit policies in Russia and unexpected low restocking from South and Japan

 

MLA has contradicted its prediction last year of a pickup in demand in the opening months of 2009.

 

MLA had projected Australia, the world's number second largest beef exporter, to win the largest slice of the world beef market due to a sharp fall in the Australian dollar's value.

 

But export markets for beef remain weak due to continued problems with credit, stock buildup and fear of falling demand.

 

In 2008, Australian beef exports went up by 2 percent on the previous year to reach a record 957,479 tonnes, due to increased imports to Russia and the European Union where Australian beef dislodged beef from Brazil, the world's top exporter.

 

Brazil expects stable beef exports this year amid Russia's struggle to pay imports because of scarce credit and a weak rouble.

 

Last year, Brazil's beef exports declined by 20 percent to 1.022 million tonnes due to European Union's partial ban on Brazilian beef over food safety and cattle traceability issues. Weak markets saw cattle prices fall at saleyards across Australia this week, with the downward pressure accentuated by a drought across southern Australia that pushed more cattle on to the market as grazing conditions deteriorated.

 

Russia became Australia's fourth largest beef market in 2008 but exports came to a standstill in the final quarter as importers faced funding problems.

 

MLA said the Middle East was now one of the fastest growing markets for Australian beef exports, growing 200 percent last year.