June 25, 2008

Australian beef export volume and value would decline next fiscal year starting July 1 due to lowered production and waning demand in key export markets, according to a forecast issued by the Australian Bureau of Agricultural and Resource Economics (ABARE) on Monday (June 23, 2008).

Australian bone-free beef exports next fiscal year are forecast at 900,000 tonnes valued at AU$4.08 billion (US$3.90 billion), compared with exports this fiscal year estimated at 930,000 tonnes valued at AU$4.16 billion (US$3.98 billion).

Beef production is expected to drop to 2.14 million tonnes next year from this year's estimate of 2.16 million tonnes, according to the forecast.

The drop in beef production is due to lower cattle slaughter, which is estimated to drop nearly 1 percent to 8.7 million head next year from 8.8 million head expected for this year.

Beef exports to South Korea would decline as the Asian country reopens its market to US beef, ABARE said. However, the agency took comfort in the fact that South Korean consumers are showing defiance against the US-South Korea beef deal, which could lessen the impact on Australian beef exports.

If Tokyo also lifts its import restrictions on US beef, Australian beef exports to Japan would inevitably decrease, ABARE said.

ABARE said live cattle export next year is expected to drop to 680,000 head from 700,000 head this year due to projected cattle price increase and a strong Australian dollar.

Australia is the world's second-biggest beef exporter after Brazil.