October 3, 2005

USDA: Australia livestock and products annual 2005

Australian livestock industries have experienced relatively extreme conditions over the past three years. Severe drought conditions have sharply reduced feed grain and fodder supplies and created downward pressure on inventories.

More recently, heavy soaking rains in many of the livestock producing and feed grain growing areas, have seen pasture conditions and fodder reserves improve greatly. 

This circumstance is likely to see average cattle slaughter fall for CY 2005 and CY 2006 and inventories rise. Production of beef is expected to rise in CY 2005 however, as slaughter weights improve with seasonal conditions. 

Production is expected to fall slightly in CY 2006 as producers continue to withhold cattle from slaughter for breeding purposes.

Exports of Australian beef are forecast to remain at historically high level for CY 2005 and CY 2006 as export demand maintains its strength. The absence of US beef from the Japanese market has resulted in record exports and the Australian feedlot industry has reacted by increasing capacity, with record numbers on feed.

The strength of the Australian dollar continues to constrain performance for export dependant industries such as pig meat.

A Federal Court ruling in the first half of CY 2005 created uncertainty for future pork imports. This ruling was recently overturned under appeal, however the intermittent period saw high levels of pork imports, particularly from the United States, in anticipation of a trade impact. 

Following the favorable ruling, Post expects monthly import levels to revert those experienced prior to the court ruling with imports poised to resume the long-term growth trend established over the past decade.

For the full USDA report, click here.