November 28, 2007

Hard times for the Australian red meat sector

Drought, high Australian dollar and rising grain prices are the obstacles that the Australian red meat industry has to hurdle nowadays.

That was the message from Meat and Livestock Australia chairman Don Heatley at the company's annual general meeting in Rockhampton last week.

According to Heatley, "the drought, combined with the meteoric rise in the dollar and continuing high grain prices, has lead to an irrevocable change in the cost of producing red meat in Australia."

He warned that the industry could not compete on price, nor could it any longer operate as a commodity trader. The industry's resilience would be tested as consumers were asked to pay more for red meat, he stated.

Addressing the situation as "one of our biggest challenges", Heatley called for harnessing the knowledge learned from previous experience and create more investments in research and development to resolve the problem.

This message comes as total export and domestic beef sales reached A$11.5 billion, with lamb and mutton sales at A$3.6 billion.

Beef exports lifted to reach a record A$4.9 billion, with almost half this from sales to Japan.

Domestic beef consumption also increased, to a record A$6.6 billion. National lamb sales were almost A$2 billion in 2006-07. Goatmeat exports were worth A$77 million.

The value of the livestock export trade grew 10 percent to A$769 million.

US$1 = A$1.1417 (as of November 27)