September 3, 2013

A July report from Meat and Livestock Australia (MLA) identified that a record 92,279 tonnes of Australian beef and veal had been exported to China in 2013 - worth more than US$350 million, and a whopping increase from 7,736 tonnes a year earlier.

ONE of the good things about selling cattle to China, industry experts say, is they take everything from hoofs to the prime rib cuts. But some Chinese are increasingly picky and that offers opportunity for an Australian beef industry gutted by drought and an Indonesian live export ban.

MLA said the surge was driven by factors including population growth, falling cattle herds in China, a strong economy and "increasing concerns over food safety". It's not all dramatic leaps - a USDA paper estimated Chinese consumption of beef was at 5.74 million tonnes in 2009 and 5.6 million in 2012.

Still, Queenslander Prue Bondfield of beef cattle seedstock producer Palgrove Charolais is among those eyeing Chinese markets, especially the notion of offering a premium product.

Bondfield recently went to China with husband David and advisory group BDO. She said there was a focus on where food had been farmed and produced. Palgrove already exports to Russia and Thailand. Last year, they got contact from China.

The idea is to develop a branded beef product to market into China. Farmers that use Palgrove bulls to produce cattle would have those beasts sent to a processor, who exports the beef to a Chinese agent. The Bondfields, who have negotiated with that agent, say genetics can be used to identify where the beef came from.

There are no firm figures yet and China poses risks. Bondfield highlighted communication was an issue, partly because of different understandings of concepts. "Some things have to be said three or four times," she said.

Another issue was potential contract problems - there are stories of others having their Chinese partner change their mind, stranding the Australians' containers on a shipping dock.

Bondfield said China offered the advantage of being an increasing beef export market, whereas Japan and Korea were mature sectors. "You're always looking for where the next market might be," she said.