July 30, 2009

Growth in domestic feedstock industry will eat into grain exports from Australia's east coast, according to Ridley Corp chief John Murray.

The local feed market had been growing at four percent annually and now constituted the largest single demand for Australian grain, Murray said.

In about five to 10 years, little grain will be exported from the Australian eastern states, based on the domestic feed industry's growth, he said.

Domestic feed grain requirements were now eight million tonnes per year, with most of it going to the livestock sector.

Yet the domestic market represented consistency, and will be highly valued by grain producers, Murray said.

The largest feedstock users were beef at 26 percent, dairy at 25 percent, poultry at 19.4 percent, and pork at 16 percent, according to Murray.

The poultry sector was driven by feed conversion ratios, while the feedlot livestock sector aims to drive conversion ratios, and the trend indicated a rising focus on grain quality, he said.

Murray said they will not accept old grain, as grain quality can affect processing and animal performances.

The worst case scenario would be the emergence of a disease such as mad cow disease from poor quality feed, and that would put more importance in grain traceability, farm quality assurance and codes of practices covering storage, handling and transport, Murray concluded.