May 6, 2013

 

Australia's beef exports rise by 10% in Jan-Apr

 

 

In the first four months of 2013, Australia's beef shipments totalled 308,755 tonnes swt, up 10% on the previous year and 8,000 tonnes swt ahead of the previous January-April record, set back in 2007.

 

This is according to reports of Meat and Livestock Australia (MLA).

 

On-going dry conditions and the build-up of the national herd over the past three years has seen a big increase in cattle slaughtered this year, flowing through to a record volume of Australian beef exports.

 

Assisting the record start to 2013 was a 19% on-year increase in exports for April, at 85,332 tonnes swt, the highest April volume since 2008. MLA reports the indicative eastern states adult slaughter for the first four months of the year totalled 172,000 head more than the corresponding period in 2012.

 

While the increased supply has flowed through to exports, the lower Australian cattle prices have been the primary avenue offsetting the impact of the strong Australian dollar, helping to keep Australian beef prices competitive in most overseas markets.

 

During April, shipments to Japan were back 6% on-year, at 23,115 tonnes swt, with the weaker yen and increased competition from the US continuing to challenging trade. The on-year decline for April largely mirrors the overall decline to Japan for the first four months of 2013, down 5% on last year, to 85,452 tonnes swt.

 

Attractive prices and record volumes to China, along with strong competition from New Zealand, contributed to Australian beef shipments to the US for April declining 7% on-year, to 17,722 tonnes swt. Australian volumes for the first four months of 2013 to the US were well below initial expectations, back 20% on-year, totalling 64,796 tonnes swt. Australian beef exports to China for April totalled 11,654 tonnes swt, exceeding shipments to Korea for the third consecutive month.

 

For the first four months of 2013 exports to China have exceeded 40,000 tonnes swt - an increase of 38,000 tonnes swt on the same period last year and helping to explain the slower than anticipated volumes to traditional markets of the US and Japan.

 

While the longer term outlook for Australian beef to China is still somewhat uncertain, every month that passes by is increasing confidence for the future of the trade, with Australian shipments for 2013 now estimated to exceed 80,000 tonnes swt.

 

Exports to Korea for April were up 27% on-year, at 9,606 tonnes swt, albeit this is compared against a very low 2012, when demand from Korea was particularly weak during the first half of the year.

 

Reflecting the improved demand so far in 2013 has been a 20% increase in exports for the first four months of 2013, at 38,012 tonnes swt, just behind the volume to China.

 

Like China, Australian beef exports to the Middle East in early 2013 have exceed all expectations, with shipments for April falling just three tonnes short of the previous record high set two months earlier, totalling 5,460 tonnes swt, up 142% on-year.

 

For January-April 2013, exports totalled 19,105 tonnes swt, 111% or 10,056 tonnes swt above the corresponding period last year, with Saudi Arabia taking over 3,000 tonnes in April alone. Increased volumes were also registered to the EU for the past month, up 13% on-year, at 1,620 tonnes swt, as additional volumes of chilled beef continue to enter the market.

 

Other markets to register increased on-year volumes during April included a number of South East Asia destinations, including Malaysia (up 52%, at 1,443 tonnes swt), Indonesia (up 101%, at 2,800 tonnes swt), the Philippines (up 197%, at 2,400 tonnes swt) and Singapore (up 26%, at 944 tonnes swt). Declines were registered to Taiwan (down 16%, at 2,903 tonnes swt) and Hong Kong (down 39%, at 367 tonnes swt).

 

Looking ahead, MLA reports with the higher cattle slaughter expected to be sustained through May, along with lower cattle prices, exports are expected to sustain their record pace. Given recent monthly performances and no disruptions to processing activities expected throughout May, the all-time high monthly record of 94,963 tonnes swt set in November 2006 could come under significant pressure, according to MLA.