May 4, 2006

 

More Australian farmers to produce grain-fed cattle

 

 

Australia is hoping to hold the lead in Japan's beef market by catering to the Japanese penchant for grain-fed beef, according to Meat & Livestock Australia.

 

Australian beef currently accounts for 90 percent of Japan's beef imports and about half of overall beef consumption in Japan.

 

Before Japan closed its market to US beef, nearly half its beef imports came from the United States and the other half from Australia.

 

To cater to Japanese tastes, more and more Australian farmers are raising grain-fed cattle. Cattle raised on corn, soybean and other grains tend to produce beef that is tender and marbled with fat which is preferred by Japanese consumers. Australians traditionally eat grass-fed beef, which is better for health, but also tougher and less tasty.

 

As the import ban on American beef continued, Australian beef has become the import of choice for Japanese consumers.

 

Australian beef has a long history of strict safeguards. Before the first mad cow case in Britain in 1986, Australia banned imports of bone meal used in animal feed which was later widely believed to be a source of transmission of the disease. It was not until 1997 that the US imposed a similar ban.

 

Meanwhile, Japan and the United States continue to haggle over mad cow safeguard measures with no agreement in sight. However, several US senators have threatened to take action against Japan if it does not open its markets by June.

 

Meat & Livestock Australia estimates that Australia's beef exports to Japan in 2006 will decline 4 percent from the record level of the previous year to 390,000 tonnes if Japan resumes imports of US beef.

 

Australian producers are keeping their fingers crossed that exports could hit a record high for three straight years, given grave concerns among Japanese consumers about the safety of American beef.

 

However, hoping for a record this year may be a tall order, as Australian beef exports are already experiencing significant declines in April.

 

During the first four months of 2006, beef exports to Japan were down 9 percent on-year, to 124,200 tonnes.  

 

Beef shipments to Japan during April was down 21 percent on-year after hitting records last month, as the market cooled off as traders took time to evaluate sales during the Golden Week holidays.

 

Exports to the US also fell during April by 31 percent, to 22,600 tonnes, due to smaller returns from a stronger Australian dollar, oversupply in the US meat market and a 22-percent decline in Australian cattle yardings.

 

Total exports to the US during the first four months of the year were only down 2 percent on 2005 levels, at 92,700 tonnes.