May 14, 2009
China, India seen to boost Australian red meat industry
History suggests periods of significant urbanisation, which is currently occurring in China and India, lead to strong demand growth and a solid positive trend in real beef prices, according to Westpac Senior Agri Economist Justin Smirk.
Smirk drew on 150 years of economic data to form his prediction that the future for Australia's red meat industry would be the best in decades.
The urbanisation of China and India will drive a new commodity 'supercycle' that can last to at least 2030, he said.
China is not only the world's most populous nation, but also the world's largest consumer and producer of meat, Smirk said.
Although the pace of growth in demand for red and white meats is forecast to slow to two percent per year from around 2.5 percent during the previous decade, beef demand is forecast to grow by 1.9 percent, up from 1.3 percent, he said.
The loss of momentum in this combined red and white meats demand is due to the moderation for pork and poultry, the main staple meats for Asia.
