September 7, 2007

Australia's August beef exports down 6 percent on weak North Asia demand

Australian beef exports in August dropped 6 percent on the same time last year, to 79,122 tonnes slaughterweight (swt) due to weakened demand from North Asia and the high Australian dollar, figures from Department of Agriculture, Fisheries and Forestry show.

Shipments increased 3 percent both on July and 9 percent on-year with the tough winter weather contributing to higher cattle turnoff.

In Japan, increased competition from US beef and strong Australian dollar continued to place pressure on returns to Australian exporters. Australian beef exports to Japan fell 7 percent on August 2006 and 4 percent on July to 30,325 tonnes swt.

The Chuseok holiday in late September and the suspension of import clearances of US beef saw Australia's beef exports to Korea up by 20 percent on July to 13,478 tonnes swt. However, shipments were 15 percent lower than in August 2006.

Shipments to Japan and Korea are forecast to remain below year ago levels heading toward the end of 2007, with US beef returning to North Asia under less restricted conditions. This should allow for a further recovery in shipments to other markets, particularly the US and Southeast Asia/Chinas.

On the other hand, beef exports to Southeast Asia/Chinas showcased robust growth in August, rising 39 percent on August 2006, to reach 7,258 tonnes swt - assisted by higher beef production, lower demand from North Asia and increasing demand for manufacturing beef in Indonesia. Australian exported a record 3,709 tonnes swt of beef to Indonesia during August, double exports in July and 180 percent higher than August 2006.

Beef exports to the US were steady during August, up 1 percent on July but down 1 percent on the same time last year, registering 24,595 tonnes swt. Returns from the US for Australian manufacturing beef remained stagnant due to the stronger Australian dollar.

US$1 = 1.2082 Australian dollar (as of September 7, 2007)