Despite record cattle numbers exported to Indonesia in the first quarter of 2010, there are ongoing concerns around the issuing of Indonesian import permits and an oversupply of cattle in the market.

Australian live cattle exports to Indonesia during the first quarter of 2010 reached record levels, at 142,000 head, as total exports to all markets increased 25% on-year, to 220,000 head, according to Australian Bureau of Statistics. Along with Indonesia, shipments for the first three months of 2010 also increased with the reopening of Egypt, taking 16,000 head.

However, while the record shipments to Indonesia during the first quarter of 2010 were largely anticipated, several issues emerged throughout the period which could impact the trade into the middle of the year. The most significant concern continues to be the uncertainty surrounding the allocation of import permits by the Indonesian government, which are not being issued as freely as in previous years. Most importers are receiving permits as required, however, often at reduced volumes.

Despite the increased imports, sales of cattle from feedlots have slowed in Indonesia, leading to some accumulation of animals in feedlots causing oversupply concerns – the result of an increase in boxed beef and offal in imports over the period. However, the ongoing impact of this is expected to be short term, live cattle demand is expected to strengthen, as the peak buying period of Ramadan is expected to commence in May.