May 8, 2008

 

Australian beef exports to Russia triples in April

 

 

Growing demand and disruption in South American supplies has enabled Australian beef exports to Russia to more than triple in April from March, with strong exports expected to continue into May.

 

Australian beef exports to the Commonwealth of Independent States, chiefly Russia, more than tripled in April to 8,426 boneless tonnes from 2,572 tonnes in March.

 

The country's beef exports to Russia in April 2007 last year totaled just 75 tonnes.

 

While volumes have swung sharply in recent years, this opportunity would enable Australia to develop a long-term supply niche, according to David Jones, manager for Europe and Russia with marketing concern Meat & Livestock Australia Ltd.

 

"The Russians are short of protein, short of beef," he told Dow Jones Newswires. "They are the largest beef importer in the world."

 

Match Russian demand and Australian reliability, and there would be a good niche product, he said.

 

Australia is the second biggest global exporter of beef after Brazil with annual exports in 2007 of 941,419 boneless tonnes, valued at almost AUS$5 billion.

 

Cumulative exports to CIS January through April has soared to 13,192 tonnes, compared with 445 tonnes in the year-earlier period.

 

Jones acknowledged the trade is not stable,  but said shipments from Australia in May will also be strong due to interest shown by exporters.

 

Exporters ship the mostly frozen, mostly manufacturing grade product to the Russian ports of Vladivostok in the Pacific east and St.Petersburg in the north-west, he said.

 

A temporary ban on certain meat imports from producers in six European countries also help Australian exports. The ban was imposed late April by Russia's agricultural watchdog amid concerns about residues of antibiotics.

 

Jones said it's too early to say whether the trade is likely to continue or whether this new demand source from Russia will help push Australian beef prices higher.

 

He said a part of the expanded trade could be entrepreneurial unless the beef is moving through Russia's internal supply chain, rather than being warehoused.

 

Importers could be doing it in anticipation of further shortages of South American beef in the Russian market, he said.

 

The EU could lift current restrictions on Brazilian beef, meaning that some of the Brazilian beef, currently being shipped to other destinations, could be diverted to E.U.

 

Farmer strikes in Argentina and the government's stalling on its promises to allow beef exports is also affecting beef supply.